SK Telecom, Korea's top mobile carrier, reported a fall in its first-quarter sales and operating profit from a year earlier on Thursday amid the sluggish market and higher costs from some subsidiaries.

Its revenue dropped 0.3 percent on-year to 4.22 trillion won ($3.68 billion) in the first three months of 2016, the Seoul-based firm said in a regulatory filing.


It attributed the decline to the elimination of sign-up fees and increased number of subscribers using contract-based mobile fee discounts.

Operating income also shed 0.1 percent to 402.1 billion won during the period from a year earlier, attributable to increased costs from such subsidiaries as SK broadband and SK Planet, according to the firm.

The figures stop short of market forecasts. Local brokerages had predicted a growth in SK Telecom's revenue, citing its efforts to cut marketing expenditures.

A silver lining is that net profit jumped 29.3 percent to 572 billion won on the back of gains from SK Planet's sale of shares in Loen Entertainment which runs music service Melon.

SK officials said they will continue to push for a "paradigm shift" in their business.

Starting this year, SK Telecom's president Jang Dong-hyun announced two main goals: transformation in its business model and a turnaround in earnings.

"In the first quarter of 2016, SK Telecom has focused on strengthening its core competitiveness as a mobile carrier through customer-oriented innovations, differentiated services, products and enhanced mobile network quality," the company said in a press release.

Hwang Keun-joo, head of the firm's strategy planning office, also said, "We will enhance profitability with innovative products and services. We will continue to raise corporate value as a next-general platform operator." (Yonhap)