Risks Relating to Our Business Competition may reduce our market share and harm our business, financial condition and results of operations. We face substantial competition across all of our businesses, including our wireless telecommunications business. We expect competition to remain intense as new technologies, products and services are developed and introduced by us and our competitors. We expect that such trends will continue to put downward pressure on the rates we can charge our subscribers. Historically, there has been considerable consolidation in the telecommunications industry, resulting in the current competitive landscape comprising three mobile and fixed network operators in the Korean market, us, KT Corporation (“KT”) and LG Uplus Corp. (“LG U+”). Each of our competitors has substantial financial, technical, marketing and other resources to respond to our business offerings. As of December 31, 2025, the collective market share of KT and LG U+ amounted to approximately 58.4% in terms of number of mobile phone subscribers (including an aggregate of 15.1% attributable to mobile virtual network operators (“MVNOs”) that lease KT’s and LG U+’s respective networks). Our market share in 2025 was negatively affected by the impact of a cybersecurity incident, of which we became aware in April 2025, involving the leakage of certain universal subscriber identity module (“USIM”) information of our 5G and LTE network subscribers. See “—Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers.” 4 Table of Contents Our competitors for subscriber activations include MVNOs, including MVNOs that lease our networks. MVNOs generally provide rate plans that are relatively cheaper than similar rate plans of the wireless network providers from which they lease their networks, including us. In recent years, a number of new entrants have entered the MVNO business, including affiliates of leading financial institutions in Korea. Some of these new entrants have engaged in aggressive marketing campaigns and promotional discounts while leveraging the brand power of their affiliates as part of their efforts to gain subscribers. Partly as a result of such efforts, the combined market share of MVNOs has generally increased in recent years, including from 15.5% as of December 31, 2023 to 16.9% as of December 31, 2024 and 18.3% as of December 31, 2025, in terms of number of mobile phone subscribers. In January 2025, the Government announced a number of new policy measures to strengthen the competitiveness of MVNOs, including lowering the cost of leasing networks from wireless network providers (including us) and providing support for the emergence of “full MVNOs” possessing their own core network infrastructures and telephone platform operations. We cannot assure you that such policy measures will not lead to further increases in the combined market share of MVNOs or encourage new MVNOs to enter the market. In addition, other companies may enter the wireless network services market. For example, in January 2024, the Government allocated 800 MHz of bandwidth in the 28 GHz spectrum to Stage X, a consortium led by Stage Five, an MVNO, to provide nationwide wireless network services. However, in July 2024, the Government revoked such allocation citing Stage X’s failure to meet the paid-in capital requirement and discrepancies in the actual ownership ratios of major shareholders and ownership structure compared to the information included in its frequency allocation application. We believe that a continued increase in the market share of MVNOs (including through the entrance of new MVNOs, if any) and the entrance of new mobile network operators, if any, in the wireless telecommunications market may further increase competition in the telecommunications sector, as well as cause downward price pressure on the fees we charge for our services, which, in turn, may have a material adverse effect on our business, financial position and results of operations. See “— Our business, financial condition and results of operations may be adversely affected if we fail to acquire adequate additional frequency usage rights, renew existing frequency usage rights, or use our bandwidth efficiently to accommodate subscriber growth and subscriber usage” and “— Our businesses are subject to various types of Government regulation, and any change in Government policy relating to the telecommunications industry could have an adverse effect on our business, financial condition and results of operations.” Our fixed-line telephone service competes with KT and LG U+, as well as other providers of voice over Internet protocol (“VoIP”) services. As of December 31, 2025, our market share of the fixed-line telephone and VoIP service market was 15.6% (including the services provided by SK Broadband Co., Ltd. (“SK Broadband”)) in terms of number of subscribers compared to KT with 51.6% and LG U+ with 18.1%. In addition, our broadband Internet access, Internet protocol TV (“IPTV”) and cable TV services provided through SK Broadband compete with other providers of such services, including KT, LG U+ and cable companies. Furthermore, our IPTV and cable TV services are facing an increasing level of competition from global operators of online video streaming platforms, such as YouTube, Netflix, Disney Plus and Apple TV, leading domestic video streaming platforms such as TVING, Coupang Play, Wavve (which is seeking to merge with TVING pursuant to a memorandum of understanding entered into in December 2023) and Watcha, and the video contents offered by leading domestic and global internet search, communications and social media platforms including NAVER, Kakao and Instagram, as such services continue to become increasingly popular to serve as a substitute to traditional television programming. As of December 31, 2025, our market share of the broadband Internet market was 28.7% in terms of number of subscribers compared to KT with 40.3% and LG U+ with 22.1%. As of December 31, 2025, our market share of the pay TV market (which includes IPTV, cable TV and satellite TV) was 25.9% compared to KT with 36.7% (including its IPTV, cable TV and satellite TV services) and LG U+ with 25.1% (including its IPTV and cable TV services), and the collective market share of other pay TV providers was 12.2%. Our market shares in the broadband Internet and pay TV markets in 2025 were also marginally and negatively affected by the impact of the above-mentioned cybersecurity incident, as a significant portion of our customers of these services subscribe to packages that combine our mobile phone services with one or both of these services. 5 Table of Contents Over the past decade, the Korean fixed-line telecommunications industry has gone through significant consolidation involving major pay television service providers. In April 2020, we completed the merger of Tbroad Co., Ltd., a former leading cable television and other fixed-line telecommunications services provider in Korea, and two of its subsidiaries, Tbroad Dongdaemun Broadcasting Co., Ltd. and Korea Digital Cable Media Center Co. Ltd. (collectively, “Tbroad”), with and into SK Broadband. In the same month, SK Telecom acquired a 55.0% equity interest in Broadband Nowon Co., Ltd. (formerly known as Tbroad Nowon Broadcasting Co., Ltd.), another subsidiary of Tbroad Co., Ltd., which was subsequently merged with and into SK Broadband in October 2022. Following such transactions (the “Tbroad Merger”), we have become the second-largest pay TV provider in Korea in terms of number of subscribers as of December 31, 2025. In November 2024, in order to enhance management efficiency and strengthen our control over SK Broadband, we entered into an agreement to acquire an additional 24.8% equity interest in SK Broadband from minority shareholders. Such transaction was completed in May 2025. We owned approximately 99.1% of SK Broadband’s total outstanding shares as of December 31, 2025. Furthermore, in March 2026, in order to enhance management efficiency and strengthen enterprise value through greater strategic flexibility, we entered into an agreement to acquire the remaining 0.9% equity interest in SK Broadband from minority shareholders. Such transaction is currently pending subject to regulatory approval and other customary closing conditions. In December 2019, LG U+ acquired a majority equity stake in CJ Hello Co., Ltd. and changed the acquired company’s name to LG HelloVision Co., Ltd. (“LG HelloVision”). In August 2021, KT acquired HCN Co., Ltd. (“HCN”), a major Korean cable TV service provider, through its subsidiary KT Skylife Co., Ltd. (“KT Skylife”). Such transactions, as well as further consolidation in the fixed-line telecommunications industry, may result in increased competition, as the entities emerging from such consolidation and other remaining players in the industry may actively pursue expanding or protecting their respective market shares. Continued competition from other wireless and fixed-line telecommunications service providers has also resulted in, and may continue to result in, deactivations among our subscribers. A substantial level of subscriber deactivations, or churn, may significantly harm our business, financial condition and results of operations. In 2025, the monthly churn rate in our wireless telecommunications business ranged from 0.7% to 2.3%, with an average monthly churn rate of 1.1%, which increased from 0.8% in 2024, mainly due to the cybersecurity incident of which we became aware in April 2025 as described above. Intensification of competition in the future may cause our churn rates to increase, which in turn may cause us to increase our marketing expenses as a percentage of sales to attract and retain subscribers. In December 2024, the National Assembly passed a bill to abolish the Mobile Device Distribution Improvement Act (the “MDDIA”), which limits the amount of handset subsidies a wireless telecommunications service provider can provide to subscribers in order to prevent excessive competition in the market, and the MDDIA was repealed in July 2025. While we will continue to strive to cautiously balance our market share and profitability margins, we cannot assure you that the abolishment of the MDDIA, which has allowed wireless telecommunications service providers to provide handset subsidies without limitation, will not intensify market competition or increase our marketing expenses. See “Item 4.B. Business Overview — Law and Regulation — Rate Regulation” below. As we continue to expand our business into areas beyond the traditional wireless and fixed-line telecommunications businesses, we also face competition from major players in the relevant sectors, such as cloud services, data center services, online commerce and television shopping (“T-commerce”). Some of our competitors may have stronger brand recognition, more robust technological capabilities and/or more significant financial resources than us in their respective areas of business. Our ability to compete successfully in all of the businesses in which we operate will depend on our ability to anticipate and respond to various competitive factors affecting the respective industries, including new services that may be introduced, changes in consumer preferences, economic conditions and discount pricing strategies by competitors. 6 Table of Contents Inability to successfully implement or adapt our network and technology to meet the continuing technological advancements affecting the wireless telecommunications industry will likely have a material adverse effect on our business, financial condition and results of operations. The telecommunications industry has been characterized by continued improvements and advances in technology, and this trend is expected to continue. We and our competitors have continually implemented technology upgrades from previous generations of prevailing network technology, including the basic code division multiple access (“CDMA”) and wideband code division multiple access (“WCDMA”) networks, to the currently dominant LTE and 5G networks. Our business could be harmed if we fail to implement, or adapt to, future technological advancements in the telecommunications sector in a timely manner, such as the further enhancement of 5G technology (including through the development and implementation of 5G-Advanced technology) and the development and implementation of an eventual successor technology to 5G technology. We launched wireless service plans using the 5G network in April 2019 following the commencement of sales of the first 5G-compatible smartphones, and we continue to maintain and enhance our 5G network coverage. We currently provide full nationwide 5G network coverage across outdoor terrestrial areas and subway lines, and substantially full nationwide 5G network coverage in large buildings. KT and LG U+ also rolled out their respective 5G wireless service plans in April 2019. The more successful operation of a 5G network or development of improved 5G technology by a competitor, including better market acceptance or network quality of a competitor’s 5G services, could materially and adversely affect our existing wireless telecommunications businesses as well as the returns on future investments we may make in our 5G network or our other businesses. In addition to introducing new technologies and offerings, we must phase out outdated and unprofitable technologies and services. For example, we discontinued our wireless broadband Internet access (“WiBro”) services in January 2019 and our second generation CDMA wireless services in July 2020. If we are unable to introduce new technologies and offerings on a cost-effective and timely basis, our business, financial condition and results of operations could be adversely affected. Implementation of new wireless technology and enhancement of existing wireless technology have required, and may continue to require, significant capital and other expenditures, which we may not recoup. We have made, and intend to continue to make, capital investments to develop, launch and enhance our wireless service. In 2025, 2024 and 2023, we spent Won 733.9 billion, Won 1,259.0 billion and Won 1,380.6 billion, respectively, in capital expenditures to build and enhance our wireless networks. We plan to make further capital investments related to our wireless services in the future, including services that can potentially leverage our 5G network and enhance the service quality of our 5G network, including through the development and application of AI technology. In addition, we plan to continue maintaining and enhancing our 5G network (including through the development and implementation of 5G-Advanced technology) as described above, while also maintaining our LTE network, which we expect will continue to be used by a material portion of our subscriber base in the near future, despite the ongoing migration of wireless service users to our 5G network. Our wireless technology-related investment plans are subject to change, and will depend, in part, on market demand for 5G and LTE services, the competitive landscape for provision of such services and the development of competing technologies. There may not be sufficient demand for services based on our latest wireless technologies, as a result of competition or otherwise, to permit us to recoup or profit from our wireless technology-related capital investments. Our businesses are subject to various types of Government regulation, and any change in Government policy relating to the telecommunications industry could have an adverse effect on our business, financial condition and results of operations. Our businesses are generally subject to governmental supervision and various types of regulation. Rate Regulation. The Government has periodically reviewed the rates charged by wireless telecommunications service providers and has, from time to time, released public policy guidelines or suggested 7 Table of Contents rate reductions. Although these guidelines or suggestions were not binding, we have implemented some rate reductions in response to them. For example, under the MDDIA, wireless telecommunications service providers were obliged to provide certain benefits, such as discounted rates, to subscribers who subscribe to their service without receiving subsidies. In June 2017, the State Affairs Planning Advisory Committee of Korea announced that it would encourage wireless telecommunications service providers, including us, to increase the applicable discount rate offered to subscribers from 20% to 25%, which we adopted in September 2017, and to offer additional discounts to low income customers, including those on government welfare programs and senior citizen recipients of the basic pension, which we implemented in December 2017 and July 2018, respectively. Although the MDDIA was repealed in July 2025, discounted rates offered under the MDDIA have been retained through a related amendment to the Telecommunications Business Act. See “Item 4.B. Business Overview — Law and Regulation — Rate Regulation” and “Item 5.A. Operating Results — Overview — Rate Regulations.” Such discounts have contributed to a general decrease in the monthly revenue per subscriber of our wireless telecommunications services. See “Item 5.A. Operating Results — Overview — Decrease in Monthly Revenue per Subscriber.” In July 2022, the MSIT requested wireless telecommunications service providers, including us, to introduce additional mid-tier 5G rate plans to provide 5G subscribers with more diverse and affordable rate plans that better meet their data usage patterns. We have since introduced several types of such new plans in 2022 and 2023. In November 2023, the MSIT requested wireless telecommunications service providers, including us, to provide 5G smartphone users with the option to subscribe to LTE rate plans, which we implemented in the same month. In addition, in January 2024, the MSIT requested wireless telecommunications service providers, including us, to introduce low-tier 5G rate plans priced under Won 40,000 per month, which we implemented in March 2024. In October 2024, during the National Assembly’s audit of the MSIT, concerns were raised about LTE rate plans that are more expensive or offer fewer benefits compared to 5G rate plans. We have since reviewed this concern and suspended new subscriptions for some of our LTE rate plans starting in February 2025. The Government may suggest other policy initiatives relating to rate plans of wireless telecommunications service providers in the future, and any further changes to our rate plans we make in response to such suggestion may adversely affect our profitability and results of operations. Technology Standards. The Government also plays an active role in setting the timetable and quality standards for the adoption and implementation of new technologies to be used by telecommunications operators in Korea. For example, the Government provided such guidance in connection with the introduction of LTE and 5G technologies in the past. The Government may provide similar guidance or recommendations in connection with the adoption and implementation of technologies to be used in future telecommunications services, and it is possible that adherence to such guidance or recommendations promoted by the Government in the future may not provide us with the best commercial returns. Frequency Allocation. The Government sets the policies regarding the use of frequencies and allocates the spectrum of frequencies used for wireless telecommunications. See “Item 4.B. Business Overview — Law and Regulation — Frequency Allocation.” The reallocation of the spectrum to our existing competitors or a new entrant to the wireless telecommunications business could increase competition among wireless telecommunications service providers, which may have an adverse effect on our business, financial condition and results of operations. See “— Our business, financial condition and results of operations may be adversely affected if we fail to acquire adequate additional frequency usage rights, renew existing frequency usage rights, or use our bandwidth efficiently to accommodate subscriber growth and subscriber usage.” MVNOs. Pursuant to the Telecommunications Business Act, certain wireless telecommunications service providers designated by the MSIT, which currently includes only us, are required to lease their networks or allow use of their networks (collectively, a “wholesale lease”) by other network service providers, such as an MVNO, that have requested such a wholesale lease in order to provide their own services using the leased networks. Currently, 15 MVNOs provide wireless telecommunications services using the networks leased from us. We believe that leasing a portion of our bandwidth capacity to an MVNO impairs our ability to use our bandwidth in ways that would generate maximum revenues and strengthens our MVNO competitors by granting them access 8 Table of Contents and lowering their costs to enter into and operate in our markets. Accordingly, our profitability has been, and may continue to be, adversely affected. Interconnection. Our wireless telecommunications services depend, in part, on our interconnection arrangements with domestic and international fixed-line and other wireless networks. Our interconnection arrangements, including the interconnection rates we pay and interconnection rates we charge, affect our revenues and operating results. The MSIT determines the basic framework for interconnection arrangements, including policies relating to interconnection rates in Korea. Such basic framework for interconnection arrangements has been changed several times in the past, and we cannot assure you that we will not be adversely affected by the MSIT’s interconnection policies and future changes to such policies. See “Item 4.B. Business Overview — Interconnection — Domestic Calls.” Regulatory Action. The MSIT may revoke our licenses or suspend any of our businesses if we fail to comply with its rules, regulations and corrective orders, including the rules restricting beneficial ownership and control or any violation of the conditions of our licenses. Alternatively, in lieu of suspension of our business, the MSIT may levy a penalty surcharge of up to 3.0% of the average of our annual revenue for the preceding three fiscal years. Such penalties, which may include the revocation of cellular licenses, suspension of business or imposition of penalty surcharges by the MSIT, could have a material adverse effect on our business. We believe that we are currently in compliance with the material terms of all of our cellular licenses. AI Technology. In January 2025, in light of the increasing proliferation of AI technology in both the private and public sectors, the National Assembly enacted the Framework Act on the Development of Artificial Intelligence and the Creation of a Foundation for Trust, which seeks to regulate the risks of the use of AI technology while also promoting the growth of AI-related industries in Korea. Such new law became effective on January 22, 2026, and the Government promulgated more detailed regulations relating to the safety and reliability of AI-generated information and the handling of user data, among other things, on the same day. In addition, the Fair Trade Act provides for various regulations and restrictions enforced by the Korea Fair Trade Commission (the “KFTC”) to prohibit or restrict actions that impede competition and fair trade. From time to time, we have been, and may in the future be, subject to investigations by the KFTC relating to potential violations of such laws and regulations. See “Item 8.A. — Consolidated Statements and Other Financial Information — Legal Proceedings — KFTC Proceedings.” Any future determination by the KFTC that we have engaged in transactions that violate the fair trade laws and regulations may result in fines or other punitive measures and may have a material adverse effect on our business. On March 12, 2026, the National Assembly passed a resolution to amend the Act on Promotion of Information and Communications Network Utilization and Information Protection. The amendments were promulgated on March 31, 2026, and will take effect beginning on October 1, 2026, except as otherwise provided for certain provisions. The amendments will require certain information and communications service providers to secure adequate personnel and budget for information security, establish an information security committee and strengthen the role and responsibilities of the chief information security officer. The amendments will also authorize the MSIT to periodically assess the stability and reliability of information and communications networks, impose notification obligations on service providers in the event of certain cybersecurity incidents and expand the scope of incident investigations and analyses. In addition, the amendments will require the establishment of a cybersecurity incident review committee under the MSIT and introduce administrative surcharges for repeated cybersecurity incidents. On February 12, 2026, the plenary session of the National Assembly passed amendments to the Personal Information Protection Act to strengthen regulations relating to personal data protection. The amendments clarified that business operators and their chief executives bear ultimate responsibility for the processing and protection of personal information and strengthened the role and responsibilities of the chief privacy officer. The amendments also expand notification obligations to data subjects to include not only the loss, theft or leakage of 9 Table of Contents personal information but also its falsification, alteration or damage, and impose notification requirements in certain cases where there is a risk of personal data leakage. The amendments also require personal information controllers of companies that meet certain criteria to be set out in the Presidential Decree based on factors, such as revenue and the scale of personal data processing, to obtain Personal Information & Information Security Management System (“ISMS-P”) certification. In addition, the amendments strengthen enforcement measures by allowing administrative surcharges of up to 10% of total revenue to be imposed in cases involving repeated or large-scale personal data breaches caused by willful misconduct or gross negligence. These amendments were promulgated on March 10, 2026, and will take effect on September 11, 2026. The requirement to obtain ISMS-P certification is scheduled to take effect on July 1, 2027. Our cost of compliance with, and any determination by the Government that we are in violation of, these or any other new laws and regulations that relate to our business and operations may have an adverse effect on our business, financial condition and results of operations. We are subject to additional regulations as a result of our dominant market position in the wireless telecommunications sector, which could harm our ability to compete effectively. The Government endeavors to promote competition in the Korean telecommunications markets through measures designed to prevent a dominant service provider from exercising its market power and deterring the emergence and development of viable competitors. We have been designated by the MSIT as the “dominant network service provider” in respect of our wireless telecommunications business. As such, we are subject to additional regulations to which certain of our competitors are not subject. For example, the MSIT has fifteen days to object to any new rates and terms of service reported by us. See “Item 4.B. Business Overview — Law and Regulation — Rate Regulation.” We may also be designated as a “market-dominating business entity” by the relevant authorities under the Fair Trade Act, based on a case-by-case assessment of factors such as our market share, barriers to entry and the relative scale of competitors. If so designated, we would be subject to additional regulations, including restrictions on engaging in conduct that could be deemed an abuse of such position. See “Item 4.B. Business Overview — Law and Regulation — Competition Regulation.” The additional regulations to which we are subject have affected our competitiveness in the past and may materially hurt our profitability and impede our ability to compete effectively against our competitors in the future. We may fail to successfully complete, integrate or realize the anticipated benefits of our new businesses, joint ventures or other strategic alternatives or corporate reorganizations, and such transactions may negatively impact our business. We continue to seek opportunities to develop new businesses that we believe are complementary to our existing product and service portfolio and expand our global business through selective acquisitions. We also continue to seek ways to optimize our corporate structure to maximize the value of our traditional businesses on the one hand and newly developed businesses on the other hand. Accordingly, we are often engaged in evaluating potential transactions and other strategic alternatives as well as corporate reorganizations, some of which may be significant in size. For example, we completed the Tbroad Merger in April 2020, following which we became the second-largest pay TV provider in Korea in terms of number of subscribers as of December 31, 2025. Moreover, in February 2022, in order to strengthen our online distribution capabilities and explore synergies with our other businesses in the information and communications technologies (“ICT”) sector, we indirectly re-acquired a 100.0% equity interest in SK m&service Co., Ltd. (“SK M&Service”), which provides online corporate employee benefits management and training services for Korean businesses and public institutions, through our wholly-owned subsidiary PS&Marketing Corporation (“PS&Marketing”), from SK Planet. However, as part of our efforts to increase our operational efficiency and re-balance our business areas, we entered into agreements 10 Table of Contents with Samgu Inc. and its affiliates in December 2024 to dispose of a 70% equity interest in SK M&Service, as well as our 100% equity interest in our former wholly-owned subsidiary NATE Communications Corporation (formerly known as SK Communications Co., Ltd.), which operates the “Nate” internet portal, and the entirety of our 50% equity interest in our former associate F&U Credit Information Co., Ltd. (“F&U Credit Information”), which provides credit information services. The disposals of NATE Communications Corporation, SK M&Service and F&U Credit Information were completed in January 2025, February 2025 and April 2025, respectively. In December 2025, we entered into an agreement to sell our entire equity stake in SK stoa Co., Ltd. (“SK Stoa”), which operates our T-commerce business, and Media S Co., Ltd. (“Media S”), which operates two TV channels and co-produces original television entertainment contents, to Rapport Labs Inc., a Korea-based e-commerce company, as part of our ongoing strategy to streamline and optimize our overall business portfolio. Such transaction is currently pending subject to regulatory approval and other customary closing conditions. We have also pursued other strategic alternatives, such as entering into a strategic alliance in July 2022 with Hana Financial Group Inc. (“Hana Financial Group”), a leading financial holding company in Korea with subsidiaries having significant presences in commercial banking, credit card business, securities brokerage and insurance, among others, to seek synergies through convergence between finance and ICT technology. As part of such strategic alliance, we transferred the entirety of our 15.0% interest in HanaCard Co., Ltd. (“HanaCard”), a leading credit card company in Korea and a subsidiary of Hana Financial Group, for Won 330.0 billion in July 2022 and acquired 8,630,949 shares of Hana Financial Group (representing a 2.9% interest) for Won 330.0 billion between July and November 2022, and HanaCard acquired 1,307,471 common shares of us (representing a 0.6% interest) for Won 68.4 billion between July and September 2022. Effective as of November 1, 2021, we conducted a horizontal spin-off (the “Spin-off”) of our businesses related to the management of our equity interests in certain subsidiaries and investees (the “Spin-off Portfolio Companies”) engaged in the semiconductor and certain other non-telecommunications businesses, including security, e-commerce and other new ICT businesses (the “Spin-off Businesses”). The Spin-off was accomplished through the establishment of a new company named SK square Co., Ltd. (“SK Square”), to which our equity interests in the Spin-off Portfolio Companies were transferred, and we distributed SK Square’s shares of common stock on a pro rata basis to the holders of our common stock. We have been actively emphasizing the development and utilization of AI technologies across our businesses and operations to enhance competitiveness, drive innovation and improve operational efficiency. In September 2025, we consolidated our AI-related business units into a centralized internal organization, which we refer to as the “AI Company-in-Company (“CIC”),” to drive more efficient and focused growth of our AI-related businesses. See “Item 5.A. Operating Results — Overview — Operational Efficiency.” We have also been collaborating with leading Korean AI technology companies as well as other global telecommunications companies, including by making various strategic investments in leading AI technology companies in recent years to facilitate mutual collaboration. For a detailed description of our recent investments in new businesses, including those relating to the field of AI technology, see “Item 4.B. Business Overview — Cellular Services — Other Solutions and Services — Other New Businesses” and “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Investments in New Growth Businesses.” While we are hoping to benefit from a range of synergies and efficiencies from our recent or future acquisitions, strategic investments and corporate reorganizations as well as our development and integration of new businesses and technologies, we may not be able to successfully complete or integrate such acquisitions, strategic investments, new businesses or technologies, or reorganized entities and may fail to realize their expected benefits in the near term, or at all. In addition, when we enter into new businesses with partners through joint ventures or other strategic alliances, we and those partners may have disagreements with respect to strategic directions or other aspects of business, or may otherwise be unable to coordinate or cooperate with each other, any of which could materially and adversely affect our operations in such businesses. Our business may be negatively impacted if we fail to successfully integrate or realize the anticipated benefits of such transactions. 11 Table of Contents Due to the existing high penetration rate of mobile phones in Korea, we are unlikely to maintain our subscriber growth rate, which could adversely affect our business, financial condition and results of operations. According to data published by the MSIT and the historical population data published by the Ministry of the Interior and Safety, the penetration rate of mobile phones in Korea as of December 31, 2025 was approximately 110.6%, which was relatively high compared to many industrialized countries. Therefore, we expect that the penetration rate of mobile phones in Korea will remain relatively stable. As a result of the already high penetration rate of mobile phones in Korea coupled with our leading market share and a declining trend in the population size of Korea, we expect our subscriber growth rate to decrease. Slowed growth or any future decrease in the number of subscribers without a commensurate increase in revenues through the introduction of new services and increased use of our services by existing subscribers would likely have a material adverse effect on our business, financial condition and results of operations. Our business, financial condition and results of operations may be adversely affected if we fail to acquire adequate additional frequency usage rights, renew existing frequency usage rights, or use our bandwidth efficiently to accommodate subscriber growth and subscriber usage. One of the principal limitations on a wireless network’s subscriber capacity is the amount of frequency spectrum available for use by the network. We have acquired a number of frequency usage rights to secure bandwidth capacity to provide our broad range of services, for which we typically make an initial payment as well as pay usage fees during the license period. We made frequency usage right fee payments of Won 99.8 billion in 2025, Won 103.0 billion in 2024 and Won 102.5 billion in 2023. For more information regarding the various bandwidths that we use and the usage right fees for such bandwidths, see “Item 4.B. Business Overview — Law and Regulation — Frequency Allocation,” “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Capital Expenditures” and note 16 of the notes to our consolidated financial statements. The growth of our wireless data businesses has been a significant factor in the increased utilization of our bandwidth, since wireless data applications are generally more bandwidth-intensive than voice services. In 12 Table of Contents particular, the continued increase in popularity of smartphones and data intensive applications among smartphone users has been a major factor for the high utilization of our bandwidth in recent years. Although such trend has been offset in part by the implementation of new technologies that enable more efficient usage of our bandwidth, we expect that the current trend of increased data transmission use by our subscribers will continue to accelerate in the near future as more subscribers migrate to our 5G network and the volume and sophistication of the multimedia content we offer through our wireless data services continue to grow in the 5G environment. While we believe that we can address the capacity constraint issue through system upgrades and efficient allocation of bandwidth, inability to address such capacity constraints in a timely manner may adversely affect our business, financial condition and results of operations. In the event we are unable to maintain sufficient bandwidth capacity, our subscribers may perceive a general slowdown of wireless telecommunications services. Growth of our wireless telecommunications business will depend in part upon our ability to effectively manage our bandwidth capacity and to implement efficiently and in a timely manner new bandwidth-efficient technologies if they become available. We cannot assure you that bandwidth constraints will not adversely affect the growth of our wireless telecommunications business. In 2021, the MSIT reallocated a total of 310 MHz of frequency bandwidths to KT, LG U+ and us, 95 MHz (in the 800 MHz, 2.1 GHz and 2.6 GHz spectrums) of which was allocated to us. See “Item 5.B. Liquidity and Capital Resources — Capital Requirements.” In December 2022, citing the lack of progress made to date with respect to the implementation of 5G infrastructure for our use of the 28 GHz spectrum (800 MHz of bandwidth which was allocated to us in December 2018 for a period of five years until November 2023), the MSIT reduced the duration of our license for the use of such bandwidth by six months and asked us to install 15,000 base stations that use the 28 GHz spectrum by the end of May 2023, which we were not able to do within the Government’s requested timetable. While we do not believe that the loss of such allocated bandwidth have had or will have a material adverse effect on our business, we cannot assure you that we will be able to reacquire such bandwidth in the future or that the failure to reacquire such bandwidth will not adversely affect our future prospects. Furthermore, in December 2022, the Government cancelled the allocations of bandwidth in the 28 GHz spectrum that had been provided to KT and LG U+, also citing the lack of progress made by these companies. In January 2024, the Government allocated 800 MHz of bandwidth in the 28 GHz spectrum to Stage X to provide nationwide wireless network services. However, in July 2024, the Government revoked such allocation citing Stage X’s failure to meet the paid-in capital requirement and discrepancies in the actual ownership ratios of major shareholders and ownership structure compared to the information included in its frequency allocation application. We may be required to pay a substantial amount to acquire additional bandwidth capacity in the future in order to meet increasing bandwidth demand or renew the rights to use our existing bandwidth, and we may not be successful in acquiring the necessary bandwidth to meet such demand at commercially attractive terms or at all, which may adversely affect our business, financial condition and results of operations. In particular, the rights to use certain of our existing frequency bandwidths are due to expire within 2026, including 20 MHz in the 800 MHz spectrum in June 2026 and an aggregate of 135 MHz in the 1.8 GHz, 2.1 GHz and 2.6 GHz spectrums in December 2026. We have applied for the renewal of the 20 MHz frequency bandwidth in the 800 MHz spectrum in December 2025, and we plan to apply for the renewal of the remaining 135 MHz of frequency bandwidths in June 2026. The final consideration to be paid by us for such reallocated bandwidths is expected to be conditional on the number of indoor 5G cell sites to be constructed by us by 2031. While we do not have any material reasons to believe that our renewal efforts will not be successful, any failure or delay in obtaining such renewal on economically viable terms or at all for any reason may have an adverse impact on our business, financial condition and results of operations. We rely on key technology professionals and senior management, and the loss of the services of any such personnel or the inability to attract and retain them may negatively affect our business. Our success depends to a significant extent on the continued service of our research and development and engineering personnel, and our ability to continue to attract, retain and motivate qualified technology professionals including researchers and engineers. In particular, our focus on leading the market in introducing 13 Table of Contents new services has meant that we must aggressively recruit technology professionals with expertise in cutting-edge technologies. Such employees are in high demand, and we devote significant resources to identifying, hiring, training, successfully integrating and retaining these employees. Competition for these individuals could cause us to offer higher compensation and other benefits to attract and retain them. We also depend on the services of experienced key senior management, and if we lose their services, it would be difficult to find and integrate replacement personnel in a timely manner, or at all. The loss of the services of any of our key technology professionals or senior management without adequate replacement, or the inability to attract new qualified personnel, would have a material adverse effect on our results of operations. We need to observe certain financial and other covenants under the terms of our debt instruments, the failure to comply with which would put us in default under those instruments. Certain of our debt instruments contain financial and other covenants with which we are required to comply on an annual and semi-annual basis. The financial covenants with respect to SK Telecom’s debt instruments include, but are not limited to, a maximum net debt-to-EBITDA ratio of 3.50 and a minimum EBITDA-to-total interest expense ratio of 4.00, each as determined on a separate financial statement basis. The debt arrangements also contain negative pledge provisions limiting our ability to provide liens on our assets as well as cross-default and cross-acceleration clauses, which give related creditors the right to accelerate the amounts due under such debt if an event of default or acceleration has occurred with respect to our existing or future indebtedness, or if any material part of our indebtedness or indebtedness of our subsidiaries is capable of being declared payable before the stated maturity date. In addition, such covenants restrict our ability to raise future debt financing. If we breach our financial or other covenants, our financial condition will be adversely affected to the extent we are not able to cure such breaches or repay the relevant debt. We may have to make further financing arrangements to meet our capital expenditure requirements and debt payment obligations. We have had, and expect to continue to have, significant capital expenditure requirements as we continue to build out, maintain and upgrade our networks and invest in businesses that complement our wireless and fixed-line telecommunications businesses. We spent Won 2,206.6 billion for capital expenditures in 2025. We currently expect to spend a slightly higher amount for capital expenditures in 2026 compared to 2025 for a range of projects, including investments to maintain and enhance our telecommunications networks (including our 5G and LTE networks), investments to improve and maintain our Wi-Fi network, investments in data infrastructure and computing capabilities, and investments in the development of AI, IoT and other digital solutions and services. Such projects also include other initiatives related to the development of new growth businesses and our ongoing businesses in the ordinary course, in each case with an emphasis on incorporating AI technology into our various existing and new business areas. However, our overall capital expenditure levels and the allocation of such expenditures remain subject to many uncertainties. We may increase, reduce or suspend our planned capital expenditures for 2026 or change the timing and area of our capital expenditure spending from the estimates described above in response to market conditions or for other reasons. We may also make additional capital expenditures and other investments beyond our currently anticipated level as opportunities arise, including in relation to any acquisitions of additional frequency usage rights or execution of additional AI-related investments. In particular, we continue to make significant capital investments to maintain and upgrade our wireless networks in response to growing bandwidth demand by our subscribers. Bandwidth usage by our subscribers has rapidly increased in recent years primarily due to the increasing number of data intensive mobile applications and use of such applications by smartphone users. If heavy usage of bandwidth-intensive services grows beyond our current expectations, we may need to invest more capital than is currently anticipated to expand the bandwidth 14 Table of Contents capacity of our networks or our customers may experience suboptimal performance when using our services. Any of these events could adversely affect our competitive position and have a material adverse effect on our business, financial condition and results of operations. For a more detailed discussion of our capital expenditure plans and a discussion of other factors that may affect our future capital expenditures, see “Item 5.B. Liquidity and Capital Resources — Capital Requirements — Capital Expenditures.” As of December 31, 2025, we had Won 2,350.2 billion in contractual payment obligations (excluding short-term leases and leases of low-value assets) due in 2026, which mostly involved repayment of debt obligations and payments related to lease liabilities and frequency licenses. See “Item 5.B. Liquidity and Capital Resources — Contractual Obligations and Commitments.” We have not arranged firm financing for all of our current or future capital expenditure plans and contractual payment obligations. We have, in the past, obtained funds for our proposed capital expenditure and payment obligations from various sources, including our cash flow from operations as well as from financings, primarily debt and equity financings. Any material adverse change in our operational or financial condition could impact our ability to fund our capital expenditure plans and contractual payment obligations. Volatile financial market conditions and an increasing interest rate environment may also curtail our ability to obtain adequate funding and/or increase our cost of borrowings, which would have an adverse effect on our liquidity and financial position. Inability to fund such capital expenditure requirements may have a material adverse effect on our business, financial condition and results of operations. In addition, although we currently anticipate that the capital expenditure levels estimated by us will be adequate to meet our business needs, such estimates may need to be adjusted based on developments in technology and markets. Failure to meet any such increased expenditure requirements or to obtain adequate financing for such requirements on terms acceptable to us, or at all, may have a material adverse effect on our business, financial condition and results of operations. Termination or impairment of our relationship with a small number of key suppliers for network equipment and for leased lines could adversely affect our business, financial condition and results of operations. We purchase wireless network equipment from a small number of suppliers. To date, we have purchased substantially all of the equipment for our networks from Samsung Electronics Co., Ltd. (“Samsung Electronics”), Ericsson-LG Co., Ltd. (“Ericsson-LG”) and Nokia Corporation (“Nokia”). In addition, we purchase a substantial majority of our wireless devices from Samsung Electronics and Apple. Although other manufacturers sell the equipment we require, sourcing such equipment from other manufacturers could result in unanticipated costs in the maintenance and enhancement of our wireless networks. Inability to obtain the equipment needed for our networks in a timely manner may have an adverse effect on our business, financial condition and results of operations. We cannot assure you that we will be able to continue to obtain the necessary equipment from one or more of our suppliers. Any discontinuation or interruption in the availability of equipment from our suppliers for any reason could have an adverse effect on our business, financial condition and results of operations. In addition, inability to lease adequate lines at commercially reasonable rates may impact the quality of the services we offer and may also damage our reputation and our business. Our business relies on technology developed by us, and our business will suffer if we are unable to protect our proprietary rights. We own numerous patents and trademarks worldwide, and have applications for patents pending in many countries. In addition to active research and development efforts, our success depends in part on our ability to obtain patents and other intellectual property rights covering our services. We may be required to defend against charges of infringement of patent or other proprietary rights of third parties. Although we have not experienced any significant patent or other intellectual property disputes, we 15 Table of Contents cannot be certain that any significant patent or other intellectual property disputes will not occur in the future. Defending our patent and other proprietary rights could require us to incur substantial expense and to divert significant resources of our technical and management personnel, and could result in our loss of rights to employ certain technologies to provide services. Malicious and abusive Internet practices could impair our services and we may be subject to significant legal and financial exposure, damage to our reputation and a loss of confidence of our customers. Our business involves the storage and transmission of large amounts of personal information, and cybersecurity breaches expose us to a risk of loss of this information, which may lead to improper use or disclosure of such information, ensuing potential liability and litigation, and loss of customers, any of which could harm our reputation and adversely affect our business. We maintain a comprehensive process for assessing, identifying and managing material risks from cybersecurity threats as part of our overall risk management system and processes. See “Item 16K. Cybersecurity.” Instituting appropriate access controls and safeguards across all of our information technology infrastructure is challenging. Furthermore, outside parties may attempt to fraudulently induce employees to disclose personal or confidential information in order to gain access to our data or our customers’ data or accounts, or may otherwise obtain access to such data or accounts. Because the techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently and often are not recognized until attacks are launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. On April 18, 2025, we became aware of a malware attack against our information technology infrastructure, which resulted in the leakage of certain USIM information of our 5G and LTE network subscribers. Upon becoming aware of such incident, we promptly deleted the malware and segregated the targeted equipment, and we have yet to find any instance of actual or attempted misuse of such information. We also alerted the Government authorities and our customers of such attack, and promptly took further measures to mitigate the potential impact of such attack, including by engaging in a comprehensive audit of our entire network system, strengthening our monitoring efforts against USIM swap frauds and unauthorized authentication attempts, and offering free USIM protection services and free replacement of USIM cards to our subscribers to block any unauthorized misuse of their USIM information, while also cooperating with Government authorities in their investigations of this incident. From May 5, 2025 to June 23, 2025, we temporarily suspended new subscriptions of mobile phone services to alleviate the shortage of USIM card replacement inventory in accordance with administrative guidance from the MSIT. Furthermore, on July 4, 2025, in order to reaffirm our commitment and restore customer trust, we announced the “Accountability and Commitment Program” consisting of the “Customer Assurance Package,” “Information Protection Innovation Plan,” “Customer Appreciation Package” and “Subscription Cancellation Fee Waiver.” Under the Customer Assurance Package, we have been providing free subscriptions to a leading third-party mobile device security solution for all customers for one year beginning in November 2025, among other things. Under the Information Protection Innovation Plan, we announced our intent to invest approximately Won 700 billion over the course of the next five years to strengthen our cybersecurity technology, infrastructure and personnel. Under the Customer Appreciation Package, we provided a range of economic benefits to our customers totaling approximately Won 500 billion in value during the second half of 2025. Such benefits included discounts on monthly subscription fees for the month of August 2025 and free additional mobile data until the end of 2025, as well as significant membership discounts redeemable at our various partnering merchants and special benefits for returning customers, in each case subject to applicable terms and conditions. Under the Subscription Cancellation Fee Waiver, we waived the subscription cancellation fees for customers who canceled their subscriptions between April 19, 2025 (which was the date of the public announcement of the cybersecurity incident) and July 14, 2025. The number of our mobile phone subscribers decreased by approximately 0.73 million over such period. In August 2025, the Telecommunications Dispute Resolution Committee under the KMCC recommended that we waive cancellation fees through year-end and reduce bundled wireless and fixed-line telecommunications service cancellation fees by 50%. We declined this recommendation in September 2025. 16 Table of Contents On August 27, 2025, the Personal Information Protection Commission of Korea (the “PIPC”) imposed a fine of Won 134.8 billion and an administrative penalty of Won 9.6 million and issued a correctional order on us in connection with this incident. While we have provisionally paid the fine and the administrative penalty in full, we filed an administrative lawsuit challenging such decision in January 2026, which case is currently pending before the Seoul Administrative Court. In addition, certain of our mobile phone service subscribers have sought dispute mediation with relevant authorities to make damage claims in connection with their alleged losses relating to the incident. To date, we have declined to accept the authorities’ proposed settlements. See “Item 8.A. Consolidated Statements and Other Financial Statements — Legal Proceedings — Other Proceedings.” Certain of our mobile phone service subscribers have also filed a number of civil lawsuits seeking alleged damages in connection with this incident, all of which are currently pending before trial courts. While we are vigorously defending ourselves in each of these cases, we are unable to predict their outcomes, and no assurance can be made that additional customers will not pursue additional legal actions to seek alleged damages against us in connection with this incident. Actual or perceived breaches of our cybersecurity of a material nature, or material harm to the market perception of the effectiveness of our cybersecurity measures may require us to incur significant legal and financial exposure, including legal claims and regulatory fines and penalties, monetary compensation to our customers, damage to our reputation and a loss of confidence of our customers, which could have a material adverse effect on our business, financial condition and results of operations. In addition, in the event of common malicious and abusive Internet activities, such as unsolicited mass advertising (i.e., “spam”), hacking of personal information, distributed denial-of-service attacks and dissemination of viruses, worms and other destructive or disruptive software, our wireless and fixed-line subscribers, in accessing the Internet through our network, may be exposed to such activities. These activities could have adverse consequences on our network and our customers, including degradation of service, excessive call volume to call centers and damage to our or our customers’ equipment and data. Significant incidents could lead to customer dissatisfaction and, ultimately, loss of customers or revenue, in addition to increased costs to us to service our customers and protect our network. Any significant loss of our subscribers or revenue due to incidents of malicious and abusive Internet practices or significant increase in costs of serving those subscribers, including in connection with the above-described cybersecurity incident, could materially and adversely affect our business, financial condition and results of operations. Labor disputes may disrupt our operations. Although we have never experienced any significant labor disputes, there can be no assurance that we will not experience labor disputes in the future, including protests and strikes, which could have an adverse effect on our business, financial condition and results of operations. Every two years, the union and management negotiate and enter into a new collective bargaining agreement that has a two-year duration, which is focused on employee benefits and welfare. Employee wages are separately negotiated on an annual basis. Although we consider our relationship with our employees to be good, there can be no assurance that we will be able to maintain such a working relationship with our employees and will not experience labor disputes resulting from disagreements with the labor union in the future. Our ability to deliver services may be disrupted due to a systems failure, shutdown in our networks or natural disaster. Our services are currently carried through our wireless and fixed-line networks, which could be vulnerable to damage or interruptions in operations due to fires, floods, earthquakes, power losses, telecommunication failures, network software flaws, unauthorized access, computer viruses and similar events, which may occur from time to time. The occurrence of any of these events could impact our ability to deliver services, we may be liable for damages to our customers caused by such interruptions, our reputation may be damaged and our 17 Table of Contents customers may lose confidence in us, which could have a negative effect on our business, financial condition and results of operations. Depreciation of the value of the Won against the Dollar and other major foreign currencies may have a material adverse effect on our results of operations and the market value of our common shares and ADSs. Substantially all of our revenues are denominated in Won. Depreciation of the Won may materially affect our results of operations because, among other things, it causes: • an increase in the amount of Won required by us to make interest and principal payments on our foreign currency-denominated debt; and • an increase, in Won terms, of the costs of equipment that we purchase from overseas sources which we pay for in Dollars or other foreign currencies. Fluctuations in the exchange rate between the Won and the Dollar will affect the Dollar equivalent of the Won price of the our common shares on the KRX KOSPI Market. These fluctuations will also affect: • the amounts a registered holder or beneficial owner of ADSs will receive from the American Depositary Receipt (“ADR”) depositary in respect of dividends, which will be paid in Won to the ADR depositary and converted by the ADR depositary into Dollars; • the Dollar value of the proceeds that a holder will receive upon sale in Korea of our common shares; and • the secondary market price of our ADSs. If SK Inc. causes us to breach the foreign ownership limitations on our common shares by being deemed to be a foreign entity, we may experience a change of control. The Telecommunications Business Act currently sets a 49.0% limit on the aggregate foreign ownership of our issued shares. Under the Telecommunications Business Act, as amended, a Korean entity, such as SK Inc., is deemed to be a foreign entity if its largest shareholder (determined by aggregating the shareholdings of such shareholder and its related parties) is a foreigner and such shareholder (together with the shareholdings of its related parties) holds 15.0% or more of the issued voting stock of the Korean entity. Notwithstanding the above, pursuant to an amendment to the Telecommunications Business Act which became effective in April 2022, a Korean entity, so long as (i) such entity’s largest shareholder (determined by aggregating the shareholdings of such shareholder and its related parties) is a foreign entity specifically designated by the MSIT incorporated in a country that has entered into a bilateral or multilateral free trade agreement with Korea, and (ii) such shareholder (together with the shareholdings of its related parties) owns 15.0% or more of the issued voting stock of such entity, may own more than 49.0% of our issued shares but may not exercise its voting rights with respect to the shares held in excess of the 49.0% ceiling until the end of the MSIT’s Public Interest Review (see “Item 4.B. Business Overview — Foreign Ownership and Investment Restrictions and Requirements”). As of December 31, 2025, SK Inc. owned 65,668,397 shares of our common stock, or 30.6%, of our issued shares. SK Inc. is currently not deemed to be a foreign entity. However, should SK Inc. be considered to be a foreign shareholder in the future, then its shareholding in us would be included in the calculation of our aggregate foreign shareholding and our aggregate foreign shareholding (based on our foreign ownership level as of December 31, 2025, which we believe was 36.2%) would exceed the 49.0% ceiling on foreign shareholding. As of December 31, 2025, the two largest foreign shareholders of SK Inc. each held a 3.4% stake therein. 18 Table of Contents If our aggregate foreign shareholding limit is exceeded, the MSIT may issue a corrective order to us, the breaching shareholder (including SK Inc. if the breach is caused by an increase in foreign ownership of SK Inc.) and the foreign shareholder which owns in the aggregate 15.0% or more of SK Inc. Furthermore, if SK Inc. is considered a foreign shareholder, it will be prohibited from exercising its voting rights with respect to the shares held in excess of the 49.0% ceiling, which may result in a change in control of us. In addition, the MSIT will be prohibited from granting us licenses or permits necessary for entering into new telecommunications businesses until our aggregate foreign shareholding is reduced to below 49.0%. For a description of further actions that the MSIT could take, see “Item 4.B. Business Overview — Law and Regulation — Foreign Ownership and Investment Restrictions and Requirements.” Risks Relating to Korea Unfavorable financial and economic developments in Korea may have an adverse effect on us. We are incorporated in Korea, and a substantial portion of our operations and assets are located in Korea. As a result, we are subject to political, economic, legal and regulatory risks specific to Korea, and our performance and successful fulfillment of our operational strategies are dependent in large part on the overall Korean economy. In addition, the future growth of the Korean economy is subject to many factors beyond our control, including developments in the global economy. In recent years, adverse conditions and volatility in the worldwide financial markets, fluctuations in oil and commodity prices, supply chain disruptions and the increasing weakness of the global economy, which have been affected by, among others, the COVID-19 pandemic, the Russia-Ukraine war and ensuing sanctions against Russia, difficulties faced by several banks in the United States and Europe, fluctuations in policy interest rates globally (including Korea), and more recently, the military conflicts between Iran and other countries, including the United States and Israel, have contributed to the uncertainty of global economic prospects in general and have adversely affected, and may continue to adversely affect, the Korean economy. The value of the Won relative to major foreign currencies, in particular, the U.S. dollar, has fluctuated significantly and, as a result of uncertain global and Korean economic, social and political conditions, there has been significant volatility in the stock prices of Korean companies recently. Future declines in the Korea Composite Stock Price Index (the “KOSPI”), and large amounts of sales of Korean securities by foreign investors and subsequent repatriation of the proceeds of such sales may adversely affect the value of the Won, the foreign currency reserves held by financial institutions in Korea, and the ability of Korean companies to raise capital. Any future deterioration of the Korean or global economy could adversely affect our business, financial condition and results of operations. Developments that could have an adverse impact on Korea’s economy include: • declines in consumer confidence and a slowdown in consumer spending, including as a result of higher levels of market interest rates; • the imposition of significant tariffs on Korea’s exports by any of its major export markets, including the United States, as well as any countermeasures or policy responses adopted by the Government that may entail significant costs; • shortages of imported raw materials, natural resources, rare earth minerals or component parts, including semiconductors, due to disruptions to the global supply chain; • rising inflationary pressures leading to increases in costs of goods and services and a decrease in purchasing power; • adverse changes or volatility in foreign currency reserve levels, interest rates, inflation rates, commodity prices (including oil prices), exchange rates (including fluctuations of the U.S. dollar, the Euro or Japanese Yen exchange rates or revaluation of the Chinese Yuan) or stock markets; • adverse conditions or developments in the economies of countries and regions that are important export markets for Korea, such as China, the United States, Europe and Japan, or in emerging market 19 Table of Contents economies in Asia or elsewhere, including as a result of deterioration of economic and trade relations among such countries or impositions of significant tariffs by any such country and increased uncertainties in the global financial markets and industry; • hostilities or political or social tensions involving countries in the Middle East (such as those resulting from the military conflicts between Iran and other countries, including the United States and Israel, and internal political or social unrest within countries in the region) and Northern Africa and any material disruption in the global supply of oil or sudden increase in the price of oil; • the occurrence of severe health epidemics in Korea or other parts of the world; • interest rate fluctuations as well as perceived or actual changes in policy rates, or other monetary and fiscal policies set forth, by the U.S. Federal Reserve, Korea and other central banks; • a continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and small— and medium—sized enterprise borrowers in Korea; • the economic impact of any pending or future free trade agreements or of any changes to existing free trade agreements; • political uncertainty or increasing strife among or within political parties in Korea following the declaration of martial law by former President Yoon Suk-yeol in December 2024 that led to his impeachment and subsequent removal in April 2025 and the election of Mr. Lee Jae-myung as President in June 2025; • a deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including deterioration resulting from territorial disputes or disagreements in foreign policy; • increased sovereign default risks in select countries and the resulting adverse effects on the global financial markets; • a deterioration in the financial condition or performance of small- and medium-sized enterprises and other companies in Korea; • investigations of large Korean business groups and their senior management for possible misconduct; • social and labor unrest; • substantial changes in the market prices of Korean real estate; • a substantial decrease in tax revenues and a substantial increase in the Government’s expenditures for fiscal stimulus measures, unemployment compensation and other economic and social programs, which, together, would likely lead to a national budget deficit as well as an increase in the Government’s debt; • financial problems or lack of progress in the restructuring of Korean business groups, other large troubled companies, their suppliers or the financial sector; • loss of investor confidence arising from corporate accounting irregularities or corporate governance issues concerning certain Korean companies; • increases in social expenditures to support an aging population in Korea or decreases in economic productivity due to the declining population size in Korea; • a continued decrease in the population and birthrates in Korea; • geopolitical uncertainty and the risk of further attacks by terrorist groups around the world; • hostilities or political or social tensions involving Russia (including the Russia-Ukraine war and the ensuing sanctions against Russia) and any resulting adverse effects on the global supply of oil and other natural resources or the global financial markets; 20 Table of Contents • natural or man-made disasters that have a significant adverse economic or other impact on Korea or its major trading partners; and • an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United States. Escalations in tensions with North Korea could have an adverse effect on us and the market value of our common shares and ADSs. Relations between Korea and North Korea have been tense throughout Korea’s modern history. The level of tension between Korea and North Korea has fluctuated and may increase abruptly as a result of future events. In particular, there have been heightened security concerns in recent years stemming from North Korea’s nuclear weapon, ballistic missile and satellite programs as well as its hostile military actions against Korea. North Korea renounced its obligations under the Nuclear Non-Proliferation Treaty in January 2003 and has conducted six rounds of nuclear tests since October 2006, including claimed detonations of hydrogen bombs and warheads that can be mounted on ballistic missiles. Over the years, North Korea has continued to conduct a series of missile tests, including ballistic missiles launched from submarines and intercontinental ballistic missiles that it claims can reach the United States mainland. North Korea has increased the frequency of such activities since the beginning of 2022, firing numerous ballistic missiles, including intercontinental ballistic missiles, and in November 2023, successfully launched its first spy satellite. In response, the Government has repeatedly condemned North Korea’s provocations and flagrant violations of relevant United Nations Security Council resolutions. Over the years, the United Nations Security Council has passed a series of resolutions condemning North Korea’s actions and significantly expanding the scope of sanctions applicable to North Korea as did the United States and the European Union. North Korea’s economy also faces severe challenges, which may further aggravate social and political pressures within North Korea. Although bilateral summit meetings between Korea and North Korea were held in April, May and September 2018 and between the United States and North Korea in June 2018, February 2019 and June 2019, there can be no assurance that the level of tensions affecting the Korean peninsula will not escalate in the future. Any increase in tensions, which may occur, for example, if North Korea experiences a leadership crisis, high-level contacts between Korea and North Korea or between the United States and North Korea break down or military hostilities occur, could have a material adverse effect on our business, financial condition and results of operations and the market value of our common shares and ADSs. Korea’s legislation allowing class action suits related to securities transactions may expose us to additional litigation risk. The Securities-related Class Action Act of Korea (the “Securities-related Class Action Act”), enacted in January 2004, allows class action suits to be brought by shareholders of companies (including us) listed on the KRX KOSPI Market for losses incurred in connection with purchases and sales of securities and other securities transactions arising from (1) false or inaccurate statements provided in the registration statements, prospectuses, annual reports, audit reports, and semi-annual or quarterly reports or omissions of material information in such documents, (2) insider trading, (3) market manipulation and (4) unfair trading. The Securities-related Class Action Act permits 50 or more shareholders who collectively hold 0.01% of the shares of a company to bring a class action suit against, among others, the issuer and its directors and officers. Because of the relatively recent enactment of the Securities-related Class Action Act, there is not enough judicial precedent to predict how the courts will apply the law. Litigation can be time-consuming and expensive to resolve, and can divert management time and attention from the operation of a business. We are not aware of any basis upon which such suit may be brought against us, nor are any such suits pending or threatened. Any such litigation brought against us could have a material adverse effect on our business, financial condition and results of operations. 21 Table of Contents There are special risks involved with investing in securities of Korean companies, including the possibility of restrictions being imposed by the Government in emergency circumstances. As we are a Korean company and operate in a business and cultural environment that is different from that of other countries, there are risks associated with investing in our securities that are not typical for investments in securities of companies in other jurisdictions. Under the Foreign Exchange Transactions Act of Korea, if the Government deems that certain emergency circumstances, including a significant disruption in the international balance of payments and international financial markets or extreme difficulty in carrying out currency, exchange rate or other macroeconomic policies due to the movement of capital between Korea and other countries, are likely to occur, it may impose any necessary restriction such as requiring Korean or foreign investors to obtain prior approval from the Ministry of Finance and Economy (the “MOFE”) for the acquisition of Korean securities or for the repatriation of interest, dividends or sales proceeds arising from Korean securities or from disposition of such securities or other transactions involving foreign exchange. See “Item 10.D. Exchange Controls — Korean Foreign Exchange Controls and Securities Regulations.” Risks Relating to Securities Sales of our shares by SK Inc. and/or other large shareholders may adversely affect the market value of our common shares and ADSs. Sales of substantial amounts of our common shares, or the perception that such sales may occur, could adversely affect the prevailing market value of our common shares or ADSs or our ability to raise capital through an offering of our common shares. As of December 31, 2025, SK Inc. owned 30.6% of our total issued common shares and has not agreed to any restrictions on its ability to dispose of our shares. See “Item 7.A. Major Shareholders.” We can make no prediction as to the timing or amount of any sales of our common shares. We cannot assure you that future sales of our common shares, or the availability of our common shares for future sale, will not adversely affect the prevailing market value of our common shares or ADSs from time to time. If an investor surrenders his or her ADSs to withdraw the underlying shares, he or she may not be allowed to deposit the shares again to obtain ADSs. Under the deposit agreement, holders of our common shares may deposit those shares with the ADR depositary’s custodian in Korea and obtain ADSs, and holders of ADSs may surrender ADSs to the ADR depositary and receive our common shares. However, under the terms of the deposit agreement, as amended, the depositary bank is required to obtain our prior consent to any such deposit if, after giving effect to such deposit, the total number of our common shares represented by ADSs exceeds a specified maximum, subject to adjustment under certain circumstances. In addition, the depositary bank or the custodian may not accept deposits of our common shares for issuance of ADSs under certain circumstances, including (1) if it has been determined by us that we should block the deposit to prevent a violation of applicable Korean laws and regulations or our articles of incorporation or (2) if a person intending to make a deposit has been identified as a holder of at least 4.0% of our common shares. It is possible that we may not give the consent. Consequently, an investor who has surrendered his or her ADSs and withdrawn the underlying shares may not be allowed to deposit the shares again to obtain ADSs. An investor in our ADSs may not be able to exercise preemptive rights for additional new shares and may suffer dilution of his or her equity interest in us. The Korean Commercial Code and our articles of incorporation require us, with some exceptions, to offer shareholders the right to subscribe for new shares in proportion to their existing ownership percentage whenever new shares are issued. If we offer a right to subscribe for additional new common shares or any other rights of 22 Table of Contents similar nature, the ADR depositary, after consultation with us, may make the rights available to an ADS holder or use reasonable efforts to dispose of the rights on behalf of the ADS holder and make the net proceeds available to the ADS holder. The ADR depositary, however, is not required to make available to an ADS holder any rights to purchase any additional shares unless it deems that doing so is lawful and feasible and: • a registration statement filed by us under the Securities Act is in effect with respect to those shares; or • the offering and sale of those shares is exempt from, or is not subject to, the registration requirements of the Securities Act. We are under no obligation to file any registration statement with respect to any ADSs. If a registration statement is required for an ADS holder to exercise preemptive rights but is not filed by us, the ADS holder will not be able to exercise his or her preemptive rights for additional shares. As a result, ADS holders may suffer dilution of their equity interest in us. Short selling of our ADSs by purchasers of securities convertible or exchangeable into our ADSs could materially adversely affect the market price of our ADSs. SK Inc., through one or more special purpose vehicles, has engaged and may in the future engage in monetization transactions relating to its ownership interest in us. These transactions have included and may include offerings of securities that are convertible or exchangeable into our ADSs. Many investors in convertible or exchangeable securities seek to hedge their exposure in the underlying equity securities at the time of acquisition of the convertible or exchangeable securities, often through short selling of the underlying equity securities or similar transactions. Since a monetization transaction could involve debt securities linked to a significant number of our ADSs, we expect that a sufficient quantity of ADSs may not be immediately available for borrowing in the market to facilitate settlement of the likely volume of short selling activity that would accompany the commencement of a monetization transaction. This short selling and similar hedging activity could place significant downward pressure on the market price of our ADSs, thereby having a material adverse effect on the market value of ADSs owned by you. A holder of our ADSs may not be able to enforce a judgment of a foreign court against us. We are a corporation with limited liability organized under the laws of Korea. Substantially all of our directors and officers and other persons named in this annual report reside in Korea, and all or a significant portion of the assets of our directors and officers and other persons named in this annual report and substantially all of our assets are located in Korea. As a result, it may not be possible for holders of our ADSs to effect service of process within the United States, or to enforce against us any judgments obtained from the United States courts based on the civil liability provisions of the federal securities laws of the United States. There is doubt as to the enforceability in Korea, either in original actions or in actions for enforcement of judgments of United States courts, of civil liabilities predicated on the United States federal securities laws. We are generally subject to Korean corporate governance and disclosure standards, which may differ from those in other countries. Companies in Korea, including us, are subject to corporate governance standards applicable to Korean public companies, which may differ in some respects from standards applicable in other countries, including the United States. As a reporting company registered with the SEC and listed on the New York Stock Exchange (“NYSE”), we are subject to certain corporate governance standards as mandated by the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). However, foreign private issuers, including us, are exempt from certain corporate governance requirements under the Sarbanes-Oxley Act or under the rules of the NYSE. There may also be less publicly available information about Korean companies, such as us, than is regularly made available by public or non-public companies in other countries. Such differences in corporate governance standards and less public information available could result in corporate governance practices or disclosures that are perceived as less than satisfactory by investors in certain countries. 23 Table of Contents Item 4. INFORMATION ON THE COMPANY