2 weeks Ago By [email protected](KoreaTimes)
Naver's office in Seongnam, Gyeonggi Province / Yonhap By Nam Hyun-woo Portal giant Naver reported a new high in its quarterly operating profit in the third quarter of this year, after showcasing a balanced growth across its search, commerce and content businesses, according to an earnings call released Friday. In its regulatory filing, Naver announced its operating profit reached 525.3 billion won ($378.
8 million) in the third quarter, achieving a 38.2 percent year-on-year growth. The revenue also grew 11.
1 percent during the same period to stand at 2.72 trillion won. If the current trajectory continues, the platform giant’s 2024 revenue will likely surpass the 10 trillion won mark for the first time in its history.
The improvements were attributed to balanced growth in its business sectors, the company said. The sales from its search platform sector grew 11 percent year-on-year to stand at 997.7 billion won, while that of the commerce sector increased 12 percent year-on-year to 725.
4 billion won. The combined sales of the two sectors accounted for 63.5 percent of Naver’s total earnings in the third quarter.
The search platform sector achieved a double-digit growth for the first time in 10 quarters, driven by enhancements in search capabilities through artificial intelligence (AI) and data integration, along with increased user engagement due to Clip, its short-form content service. “Since the introduction of Clip, our mobile traffic has been growing very quickly,” Naver CEO Choi Soo-yeon said during the earnings call. “Average daily time spent on the mobile main page grew by 10 percent compared to the same period last year.
” The increased user engagement resulted in robust growth in its revenue from search ads and display ads. The sales from search ads, which shows ads when a user searches for a certain keyword, stood at 753 billion won, up 9.5 percent from a year earlier.
The revenue from display ads, which appear on webpages, grew 11 percent year-on-year to stand at 229.5 billion won. Naver's data center in Sejong / Courtesy of Naver In the commerce sector, collaborations with various brands, enhanced commerce membership benefits and improved delivery service have driven the increase in transaction volume, the company said.
To spur the growth in the commerce sector, Choi said that the company will roll out Naver Plus Store as a standalone app in the first half of next year to provide more individualized shopping experiences to its commerce service members. Naver Plus Store was launched on Oct. 30 as an AI-driven product recommendation service.
The company’s cloud sector, which includes workplace solutions and AI, achieved a 17 percent year-on-year growth in its sales. Naver signed a deal with the Saudi Arabian government in October last year to create a digital twin platform for Riyadh and four other cities, and the company noted that related businesses began generating revenue in the third quarter. Digital twin refers to a technology mirroring real-world entities in a virtual environment.
Meanwhile, WEBTOON Entertainment, a Nasdaq-listed parent company of Naver’s digital comic service Naver Webtoon, reported that it suffered an $8.09 million operating loss in the third quarter..
