NAVER Q3 Revenue Hits a "Record High" of KRW 3.4724 Trillion; Operating Profit Down 20.9% on Higher Investment

Logistics subsidiary to be established by year-end... "Strengthening delivery competitiveness"
Growth in commerce, financial platform services and C2C

Yonhap News Agency

NAVER posted record-high revenue for the seventh consecutive quarter, driven by growth in key businesses, including commerce, its financial platform and global C2C (consumer-to-consumer) operations. To strengthen its competitiveness in commerce, NAVER plans to establish a logistics subsidiary by the end of this year and enhance its delivery capabilities.

NAVER said in a regulatory filing on November 12 that its consolidated revenue for the third quarter of this year rose 10.7% year on year to KRW 3.4724 trillion. Operating profit fell 20.9% year on year to KRW 451.3 billion. The decline was largely due to increased investment in infrastructure, content, offline data and other areas to strengthen its competitiveness in artificial intelligence (AI).

Revenue by business segment was KRW 1.9484 trillion for the NAVER Platform, KRW 487.7 billion for the Financial Platform, and KRW 1.0364 trillion for Global Challenge.

NAVER Platform revenue reached KRW 1.9484 trillion, up 7.3% year on year and 2.4% quarter on quarter. This was supported by advertising revenue growth as the company expanded efforts to monetize AI, despite the Chuseok holiday, as well as increased purchases through the NAVER Plus Store app and membership program. Service revenue rose 13.1% year on year as the commerce ecosystem continued to expand, driven by growth in NAVER Plus Store and membership users and the strengthening of N Delivery.

NAVER plans to establish a logistics subsidiary to further accelerate growth in commerce. NAVER CEO Choi Soo-yeon said, "To take our delivery competitiveness to the next level, we will establish a logistics-focused subsidiary and gradually strengthen our delivery infrastructure, which is centered on leased logistics centers. We will build a commerce ecosystem where sellers, users and partners grow together through a virtuous cycle in which stronger delivery capabilities boost transactions, and increased volume, in turn, improves efficiency."

Financial Platform revenue reached KRW 487.7 billion, up 14.1% year on year and 3.6% quarter on quarter. In the third quarter, Naver Pay (Npay) payment volume rose 15.6% year on year to KRW 26.2 trillion, supported by a 21.8% year-on-year increase in payments made outside NAVER's platform. NAVER expects the wider adoption of Npay Connect, an integrated offline payment terminal, to strengthen connections and synergies between offline stores and NAVER services.

NAVER Financial plans to become South Korea's No. 1 operator in the offline integrated payment terminal market, based on the number of active terminals, by the first half of next year.

Global Challenge revenue reached KRW 1.0364 trillion, up 15.9% year on year and 2.0% quarter on quarter. Growth was driven by the consolidation of Wallapop, higher C2C revenue as transactions on Poshmark and SODA gained traction, and an increase in enterprise revenue, including from a digital twin project in Saudi Arabia.

Starting in the first half of next year, revenue from the AI factory business NAVER is pursuing with Brookfield and NVIDIA will begin to make a full contribution to its results.

CEO Choi said, "We have secured an initial customer by signing a computing services supply contract worth approximately KRW 2 trillion for our AI factory business, and revenue from the business is expected to be recognized in stages. While pursuing medium- to long-term contracts with large customers, we also plan to expand our customer base to global AI companies with strong growth potential, securing both stability and high profitability."

NAVER is also actively seeking new revenue opportunities by advancing AI-powered services. Following AI Briefing and AI Tab, it plans to launch an AI agent app by the end of this year and deliver a new service experience that goes beyond simple recommendations and information provision to lead users to actual purchases and visits.

CEO Choi said, "Personal AI agents will offer a new way of using services by not only helping users find the information they need, but also anticipating their needs and handling tedious tasks for them. We will continue to advance the search experience while attracting new user groups and creating monetization opportunities."

This content was produced with the assistance of AI translation services.