Seoul: Naver Corp., the operator of South Korea's biggest internet portal, is forecast to post a record annual revenue in 2024 thanks to overall growth of its businesses, data showed Monday. Last year, the Korean company likely raised an all-time high sales of 10.65 trillion won (US$7.3 billion), up 10.15 percent from a year earlier, according to an estimate based on a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
According to Yonhap News Agency, Naver's yearly operating profit is expected to jump 31.97 percent on-year to 1.96 trillion won. For the fourth quarter, the company is anticipated to log 2.8 trillion won in sales, up 10.35 percent on-year, and its operating profit likely soared 30.42 percent to 528 billion won. Naver has reported the highest quarterly sales of 2.7 trillion won and 503.2 billion won in operating profit in the July-September period.
A report by KB Securities assessed Naver's profitability is improving thanks to its cost-cutting efforts and the growth of its mainstay platform business. "The company plans to officially launch a separate e-commerce app, Naver plus store, in the first half and this move is expected to lock in more consumers," the report said. In November, Naver announced its plan to apply artificial intelligence (AI) technology across its major services, including search and shopping.
Meanwhile, its rival, Kakao Corp., is expected to deliver a sluggish performance for the fourth quarter. According to data from Yonhap Infomax, Kakao will likely post an operating profit of 131.3 billion won in the last three months of 2024, down 3.43 percent from a year earlier. Its quarterly sales are forecast at 2 trillion won, up 23.97 percent on-year.
"All of Kakao's content units have faced poor growth because of stronger competition in the overall industry and the market rather than the lackluster competitiveness of Kakao itself," a report from Korea Securities and Investment Co. said. "It will be difficult to expect Kakao's recovery in the near future." Late last year, Kakao CEO Chung Shin-a said in a conference call her company will work to restructure its businesses to focus more on game and AI services.
Naver and Kakao plan to release their final earnings results next month.