Kakao Surpasses 7 Trillion Won in Sales Last Year... Operating Profit Down 2.4% (Update)

[Asia Economy Reporter Yuri Choi] Kakao surpassed 7 trillion won in annual sales last year, but its operating profit declined.

On the 10th, Kakao announced that its annual sales for 2022 reached 7.1071 trillion won, a 15.8% increase compared to the previous year. Annual operating profit was 580.5 billion won, down 2.4% from the previous year, with an operating profit margin of 8.2%.

Consolidated sales for the fourth quarter of last year were 1.7744 trillion won, similar to the same period last year but down 5% from the previous quarter. Operating profit was 100.4 billion won.

Platform division sales in the fourth quarter were 966.8 billion won, down 4% compared to the same period last year. Talk Biz sales grew steadily, recording 520.1 billion won, a 9% increase. Among these, Talk Biz advertising-type sales such as Bizboard and KakaoTalk Channel increased by 3% year-on-year due to continuous growth in message advertising despite a slowdown in the advertising market. Talk Biz transaction-type sales, including Gift and Talk Store, grew 17% year-on-year due to growth in delivery products for Gift.

Portal Biz sales were 97.9 billion won, down 25% year-on-year due to the exclusion of some consolidated subsidiaries. Other platform sales recorded 348.8 billion won, down 13%.

Content division sales increased 3% year-on-year to 807.6 billion won. Story sales were 221.6 billion won. Although down 4% from the previous quarter due to marketing efficiency improvements, sales increased 5% year-on-year thanks to growth in intellectual property (IP) distribution sales. Music sales rose 14% year-on-year to 230.5 billion won, and media sales increased 39% to 124.8 billion won. Game sales were 230.8 billion won, down 17% year-on-year due to a gap in new game releases and the off-season impact on non-game business sectors.

Operating expenses in the fourth quarter decreased 2% from the previous quarter and were similar to the same period last year at 1.674 trillion won. Annual operating expenses for 2022 increased 18% year-on-year to 6.5267 trillion won.

Kakao plans to focus on strengthening its fundamentals this year. In a continued uncertain market environment, the company aims to concentrate on providing users with value such as usefulness and convenience and to solidify its business model.

▲ Qualitative growth of KakaoTalk through communication formats and functions suited to relationships ▲ Focus on artificial intelligence (AI) and healthcare sectors to discover new growth engines ▲ Strengthening global content business to accelerate the realization of Kakao community’s ‘Beyond Korea’ and ‘Beyond Mobile’ vision.