Domestic major IT service corporations that have intensified their 'artificial intelligence (AI) transformation and construction' project are also achieving results in performance. Samsung SDS and LG CNS both recorded growth in the second quarter of this year, while SK AX is also expected to see double-digit performance increases. The performance was supported by AI-based project awards in the public and financial sectors, as well as the expansion of cloud and data center businesses.
Samsung SDS announced on the 24th that it recorded revenues of 3.512 trillion won and an operating profit of 230.2 billion won in the second quarter. This represents an increase of 4.2% compared to the same period last year. Revenues in the IT services institutional sector increased by 5.8% to 1.6784 trillion won, and especially, cloud business revenues grew by about 20% to 665.2 billion won.
Among the cloud businesses, SCP (Samsung Cloud Platform)-based CSP (Cloud Service Provider) grew by 26% year-on-year, buoyed by increased demand for high-performance computing (HPC), cloud network expansions, and the growth of public cloud project awards. The MSP (Managed Service Provider) sector also grew by 20%, supported by the cloud transformation of public institutions, rising demand for generative AI services, and the expansion of supply chain management (SCM) and customer relationship management (CRM) system implementations by overseas corporations. In the logistics sector, although some cargo volumes decreased due to U.S. tariff policies, revenue increased by 3% year-on-year to 1.8336 trillion won due to new customer acquisition in warehouse logistics. The digital logistics platform 'Cello Square' recorded revenues of 270.1 billion won, exceeding 21,900 corporate subscribers, a 48% increase compared to the same period last year.
Samsung SDS is also accelerating the dissemination of generative AI-based solutions. Its own platform 'Fabrics' and AI work assistance tool 'Brity Copilot' have secured over 130,000 users across more than 70 corporations. In the second half of the year, it plans to launch 'Agentic Bot,' which enhances the existing RPA (Robotic Process Automation) system 'Brity Automation' using natural language-based generative AI. Lee Ho-jun, head of the Cloud Service Division at Samsung SDS, noted during a conference call after the second quarter earnings announcement, 'Our full-stack integrated service, which provides everything from infrastructure to software development tools and operational management for driving AI, is our unique differentiator,' and added, 'We will continue to make substantial contributions while sharing the government's AI policy direction and technology roadmap.'
Awards in the public sector continue as well. Samsung SDS has recently been selected as the preferred bidder for the 'Intelligent Work Management Platform' project and the 'Government-wide Super Large-scale AI Common Infrastructure' project by the Ministry of Interior and Safety, securing leadership in the government's AI infrastructure construction projects. In the global market, it is expanding its supply to clients in the U.S. centered on its supply chain management (SCM) solution 'Cadencia' while responding to the demand for enterprise digital transformation utilizing AI technology. The company explained, 'We will actively participate in public projects across all areas of legislation, administration, and local governments to secure successful cases of generative AI, positioning ourselves as a core operator of the digital platform strategy promoted by the government.'
Earlier, LG CNS reported a consolidated revenue of 1.4602 trillion won and an operating profit of 140.8 billion won in its second quarter earnings announced on the 23rd. These figures represent an increase of 0.7% and 2.3%, respectively, compared to the same period last year. For the cumulative first half of the year, it achieved revenues of 2.6715 trillion won (up 6.0%) and an operating profit of 219.7 billion won (up 29.2%). Revenues from AI and cloud business sectors totaled 872.4 billion won, accounting for 60% of total revenue.
In the AI business sector, collaborations on AX (Artificial Intelligence Transformation) projects with NH Nonghyup Bank, Shinhan Bank, and Mirae Asset Life Insurance, along with large AI platform awards from the Gyeonggi Office of Education and the Ministry of Foreign Affairs, contributed to performance. The company strengthened its competitiveness in handling sensitive information and ensuring security in the financial and public sectors based on its proprietary large-scale language model EXAONE and a model jointly developed with Cohere. In the cloud sector, it broadened its business scope through AI data center consulting in Indonesia and a large-scale colocation contract in Jukjeon with Naver Cloud.
SK AX is set to announce its first performance next month after changing its name from SK C&C last June, with double-digit revenue growth expected. The company is currently transforming its entire system and organization to an Agentic AI foundation, actively pursuing AI-specific use cases across various industries such as manufacturing, finance, and energy. In manufacturing sites, an 'AI Master' system has been introduced, where AI learns and complements the know-how of skilled workers, while applications in customer behavior prediction, demand optimization, and AI contact centers have also been expanded.
In addition, it is promoting the establishment of next-generation AI data centers in collaboration with group affiliates such as SK Telecom and SK Broadband, and is creating a specialized AI service environment through technological optimization of energy efficiency and automated infrastructure. The organization is also simultaneously internalizing AI throughout its operations by introducing generative AI-based coding tests during the hiring process.
In the industry, the three IT service corporations are expected to continue expanding AI and cloud-centered businesses in the second half of the year based on performance improvements in the second quarter. An industry official noted, 'As the government's sovereign AI strategy and the restructuring of the global SaaS (cloud-based software) market align, the transition centered on Agentic AI and AI data centers is progressing rapidly,' and added, 'This trend will present business expansion opportunities for corporations equipped with relevant technologies and infrastructure.'