SK Innovation's revenue and operating profit last year rose 8.2% and 25.8%, respectively, from a year earlier. However, the net loss widened to 5.4061 trillion won. While the petroleum, lubricants, and oil development businesses were all profitable, the chemical and battery businesses posted operating losses, weighing on results.
On the 28th, SK Innovation disclosed that under consolidation, full-year revenue and operating profit last year came to 80.2961 trillion won and 448.1 billion won, respectively.
By business, the petroleum segment posted revenue of 47.1903 trillion won and operating profit of 349.1 billion won. The lubricants business recorded revenue of 3.8361 trillion won and operating profit of 607.6 billion won, while the oil development business logged revenue of 1.3675 trillion won and operating profit of 399.7 billion won. SK Innovation E&S posted revenue of 11.8631 trillion won and operating profit of 681.1 billion won.
However, the chemical, battery, and materials businesses were sluggish. The chemical business generated revenue of 8.9203 trillion won but recorded an operating loss of 236.5 billion won. The battery business posted revenue of 6.9782 trillion won and an operating loss of 931.9 billion won. The materials business posted revenue of 84 billion won and an operating loss of 233.8 billion won.
In the fourth quarter of 2025, revenue was 19.6713 trillion won and operating profit was 294.7 billion won, up 1.52% and 67.5%, respectively, from a year earlier. Compared with the previous quarter, revenue fell by 747.5 billion won and operating profit by 291 billion won. SK Innovation said, "Despite strong refining margins and solid lubricants performance in the fourth quarter last year, operating profit decreased by 291 billion won quarter over quarter due to seasonality in the SK Innovation E&S business and a slowdown in battery business profitability."
In the battery business, despite increased sales volume in Europe, revenue declined and the operating loss widened due to reduced sales following the removal of U.S. electric-vehicle purchase subsidies. Lower utilization caused by inventory adjustments by North American clients and year-end shutdowns at automakers, as well as a decrease in the Advanced Manufacturing Production Credit (AMPC), also contributed to the wider operating loss. The benefit from the U.S. Inflation Reduction Act (IRA) via AMPC amounted to 101.3 billion won.
Fourth-quarter non-operating loss was 4.6573 trillion won, a wider deficit than the prior quarter due to battery-related impairments. As a result, pretax loss was 4.3626 trillion won in the fourth quarter and 5.8204 trillion won for the year. This reflects SK On recognizing a total of 4.2 trillion won in impairments in the fourth quarter, including asset impairments recognized during the restructuring of the BlueOval SK joint venture with Ford Motor.
SK Innovation said, "This impairment recognition is a one-off adjustment arising from the process of aligning asset values with accounting standards and has no direct impact on cash flow," adding, "In the first quarter, Ford will assume the asset and liability of the Kentucky plant, so our financial structure will improve compared with year-end."
It added that in the fourth quarter of 2025, SK On pushed to strengthen the fundamentals of the battery business by restructuring its U.S. and China joint ventures, including an equity swap at the joint plant with EVE Energy (SKOJ-EUE) and winding down the BlueOval SK joint venture structure. It also said it worked to secure business competitiveness and stabilize its financial structure through portfolio rebalancing, including the merger of SK On and SK Enmove and the sale of noncore asset.
SK Innovation expects the petroleum and lubricants businesses to proceed smoothly this year. It also expects improvement in the petrochemical business. SK Innovation said, "In 2026, the petroleum market is expected to maintain solid refining margins through November as the low oil price stance of the Trump administration continues until the U.S. midterm elections, amid factors such as the dissipation of winter seasonal demand and expectations for a Russia-Ukraine cease-fire," adding, "In chemicals, spreads in aromatics are expected to improve due to reduced supply from regular maintenance for PX in the region, while olefins and polymers are expected to maintain current spread levels despite new capacity additions, given the outlook for lower naphtha prices."
In the battery business, the company plans to focus on sustainable growth and strengthening financial soundness by readjusting its business portfolio in response to an unfavorable external environment. SK Innovation said, "Alongside this, we will make expansion of the energy storage system (ESS) business a core strategy, targeting orders for global projects totaling 20 gigawatt-hours (GWh) this year, actively supplementing the profitability of new growth areas."
Seo Geon-gi, SK Innovation's chief financial officer, said, "This year we will focus on the tasks of 'strengthening fundamental competitiveness,' 'continuing to improve financial soundness,' and 'promoting electrification as a future growth driver,'" adding, "2026 will be the first year in which SK Innovation captures both solid financials and future growth, reborn as a true global energy company."