Naver Surpasses Annual Revenue of 6 Trillion Won... Declining Search Share and New Business Wings (Comprehensive)

[Asia Economy Reporter Kang Nahum] Naver posted its highest quarterly earnings ever, surpassing 6 trillion won in annual revenue for the first time in the company's history. The proportion of sales from new businesses such as commerce and content exceeded 50% for the first time, driving strong performance. Naver's 'de-search' strategy to reduce dependence on its traditional search business is showing results.

◆ First-ever annual revenue of 6 trillion won = On the 27th, Naver announced that its consolidated revenue for the fourth quarter of last year was 1.9277 trillion won, and operating profit was 351.2 billion won. Revenue increased by 27.4% and operating profit by 8.5% compared to the same period last year.

Last year's annual revenue grew 28.5% year-on-year to 6.8176 trillion won, and annual operating profit rose 9.1% to 1.3255 trillion won. Annual adjusted EBITDA recorded 1.9146 trillion won, a 22.2% increase from the previous year.

Han Seong-sook, CEO of Naver, said during the earnings conference call, "There were many concerns when Naver expanded globally and diversified its businesses, but we have now built a business portfolio that encompasses both the present and the future." She added, "Last year was a meaningful period when all business operations entered a growth phase."

◆ Wings of new businesses = Fourth-quarter revenue by business segment was ▲ Search Platform 886.9 billion won ▲ Commerce 405.2 billion won ▲ Fintech 295.2 billion won ▲ Content 233.3 billion won ▲ Cloud 107.2 billion won. The Search Platform segment recorded 886.9 billion won, up 15.2% year-on-year and 7.5% quarter-on-quarter, driven by improvements in search quality and the revamp of Smart Place. Display revenue within the Search Platform grew 26.1% year-on-year, maintaining strong growth.

Commerce recorded 405.2 billion won, up 27.9% year-on-year and 6.6% quarter-on-quarter, fueled by growth in Shopping Live and Brand Store. The transaction volume of Shopping Live grew 4.7 times compared to the previous year, and the number of live streams generating over 10 million won in transactions in Q4 increased by 39% quarter-on-quarter.

Fintech posted 295.2 billion won, up 46.8% year-on-year and 22.1% quarter-on-quarter. Naver Pay's payment volume reached 10.9 trillion won, supported by the addition of new global merchants. As payment channels diversified, external payments grew by 60%, and the number of payers reached 16 million. PayPoint recharge payments doubled compared to the previous year, increasing user numbers.

Content recorded 233.3 billion won, up 67.9% year-on-year and 26.7% quarter-on-quarter, driven by the global growth of webtoons, which surpassed 1 trillion won in annual transaction volume, and steady growth of Snow and Zepeto. Cloud grew 25.2% year-on-year and 11.4% quarter-on-quarter to 107.2 billion won, supported by new customer acquisitions.

On the same day, Naver announced a dividend of 501 won per common share, totaling approximately 73.8 billion won, based on resources of 162.1 billion won. The remaining 87.3 billion won will be used to repurchase and retire treasury shares within this year.

Park Sang-jin, Naver's Chief Financial Officer, said, "This year's growth rate is expected to be somewhat lower than last year's," adding, "We plan to achieve both qualitative and quantitative growth by actively introducing a diverse product lineup that can respond to evolving customer demands."