Seoul: Naver Corp., South Korea's largest online portal operator, announced on Thursday a significant decline in its first-quarter net profit, which fell by 31.3 percent compared to the previous year, primarily due to foreign exchange losses. The net profit for the three months ending in March was reported at 291 billion won (US$195.9 million), down from 423.7 billion won during the same period last year, as detailed in the company's regulatory filing.

According to Yonhap News Agency, the decline was mainly attributed to increased translation losses resulting from the company's dollar-denominated debt when converted into the local currency. However, despite the decrease in net profit, Naver's operating profit saw a rise of 7.2 percent, reaching 541.8 billion won in the first quarter compared to 505.3 billion won a year prior. Sales also experienced a growth of 16.3 percent, totaling 3.24 trillion won from 2.78 trillion won over the same period.

The financial results did not meet market expectations, with the average estimate for net profit being 513.7 billion won, as per a survey conducted by Yonhap Infomax, the financial data arm of Yonhap News Agency. Naver's mainstay platform business, which includes search, advertisement, and shopping, reported a 14.7 percent increase in sales to 1.8 trillion won from the previous year.

In addition, Naver's global business, covering online marketplaces and webtoon platforms, showed robust growth with first-quarter sales rising 18.4 percent to 941.6 billion won. The financial platform's sales also expanded by 18.9 percent year-on-year to 459.7 billion won. Choi Soo-yeon, Naver's CEO, emphasized the company's unique platform that integrates search, commerce, and payment infrastructure, highlighting its competitive advantages in the AI agent era. She noted that Naver aims to identify opportunities in global growth areas, such as sovereign AI, to drive overall revenue growth.