NHN Reports Q3 Operating Profit of 8.3 Billion KRW, Down 70.3% Year-on-Year

[Asia Economy Reporter Yuri Choi] NHN announced on the 8th that its consolidated sales for the third quarter of this year reached 522.4 billion KRW, with an operating profit of 8.3 billion KRW. Sales increased by 10.6% compared to the same period last year, but operating profit decreased by 70.3%.

Looking at sales by division, the gaming division recorded 115.9 billion KRW, up 21.4% year-on-year, driven by increased sales of web board games and strong performance of mobile games in Japan. In particular, web board game sales rose 38% thanks to the effect of the revised Game Act enforcement. Mobile web board game sales also increased by 64%.

The payment and advertising division recorded 227 billion KRW, up 8.9% year-on-year, supported by increased transactions with large domestic and overseas merchants through NHN Korea Cyber Payment and increased coupon business sales from Payco.

The commerce division was affected by the seasonal off-season of the China commerce business and weakened consumer sentiment, resulting in sales of 66.3 billion KRW, down 13.8% compared to the same period last year.

The technology division saw growth in both the Cloud Service Provider (CSP) business and the Managed Service Provider (MSP) business, recording sales of 71.3 billion KRW, a 24.5% increase year-on-year. Sales of the CSP business, including NHN Cloud, rose 47.1% thanks to public sector contracts, while the MSP business led by Japan NHN Tecorus grew 14.3%.

The content division recorded sales of 51 billion KRW, up 16.4%, driven by the strong performance of ‘Pocket Comics’ in North America and Europe and the recovery of NHN Link’s sports ticket sales to pre-COVID-19 levels.

NHN’s strategy is to expand its position as a global gaming company. To this end, it plans to ▲expand its proven match-three puzzle expertise from Japan and Korea to the Western market, ▲build a mid-core game lineup led by ‘Darkest Days’ scheduled for release in the first half of the year, and ▲challenge the global blockchain gaming market with games specialized in web board and social casino genres such as ‘Project Wemix Sports’ and ‘Marvel Slot.’

NHN Payco plans to focus on growing transaction volume, the essence of the payment business, while improving profitability through its own payment method ‘Point Payment’ and the advertising model ‘Coupon Business.’ NHN Cloud aims to lead growth encompassing both public and private sectors by expanding its experience with financial companies, starting with Shinhan Investment Corp., with which it recently signed a new Memorandum of Understanding (MOU).

Jung Woo-jin, CEO of NHN, said, "Based on the solid performance of the gaming business, which has become a strong growth engine following the headquarters integration, we will lead balanced growth in core businesses such as payment advertising, commerce, technology, and content, and focus our capabilities on improving profitability.”