Kakao Reports Operating Profit of 130.5 Billion KRW in Q3, Up 5% Year-on-Year (Update)

Q3 Revenue Down 4% to 1.9 Trillion
Operating Expenses Reduced by 5% Through Management Efficiency

Kakao announced on the 7th that its consolidated sales for the third quarter of this year recorded 1.9214 trillion KRW, a 4% decrease compared to the same period last year. Operating profit during this period increased by 5% to 130.5 billion KRW, with an operating profit margin of 6.8%.

Kakao Q3 Earnings. Provided by Kakao

By business segment, third-quarter platform segment sales amounted to 943.5 billion KRW, a 7% increase compared to the same period last year.

Within the platform segment, TalkBiz sales recorded 507.3 billion KRW, up 6% year-on-year. Advertising-type sales such as Bizboard and Business Message within TalkBiz reached 292.2 billion KRW, a 4% increase from the same period last year. In particular, as more advertisers adopt Talk Channel as a core communication tool, Business Message sales grew 21% year-on-year, maintaining a double-digit growth rate.

Transactional sales from Gift and Talk Store increased by 8% to 215.1 billion KRW. Commerce’s third-quarter integrated transaction volume recorded 2.5 trillion KRW, a 5% increase compared to the same period last year. This was the result of diversifying the gift lineup during the Chuseok holiday and providing users with differentiated gift experiences centered on Luxtep.

Platform Others, including Mobility and Pay, posted sales of 359.8 billion KRW, a 13% increase year-on-year. Portal Biz sales, including Daum, recorded 76.4 billion KRW.

The content segment, another pillar of Kakao’s business, recorded third-quarter sales of 977.9 billion KRW, a 14% decrease compared to the same period last year.

Within the content segment, music sales decreased by 8% to 470.9 billion KRW. Story sales declined 12% to 218.7 billion KRW. Kakao is currently continuing to streamline non-core businesses within the content segment. Through this, it is focusing on laying the foundation to accelerate growth in core markets.

Consolidated operating expenses for the third quarter were 1.7909 trillion KRW, down 5%. In anticipation of the economic and business environment outlook for the second half of the year, Kakao proactively implemented rigorous operating expense efficiency measures.

Kakao plans to officially launch not only the new artificial intelligence (AI) service 'Kanana' next year but also various services and functions integrated with AI. The company aims to provide innovative value to users and partners.