Naver sets new record with Q2 performance

[Courtesy of Naver Corp.]

Naver Corp. reported a record performance in the second quarter of 2024 that was driven by strong results across all business segments.

According to regulatory filings on Thursday, the tech giant saw an estimated 2.61 trillion won ($1.89 billion) in sales revenue for the quarter, or an 8.4 percent increase year-on-year. Operating profit rose by 26.8 percent to 472.7 billion won, extending its streak of record-high operating profits to six consecutive quarters starting from the first quarter of 2023. This figure surpassed the market forecast of 434.6 billion won compiled by Yonhap Infomax by 8.8 percent.

The operating profit margin improved for a fifth consecutive quarter, reaching 18.1 percent. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) hit a record 638.4 billion won, up 23.9 percent year-on-year and 9.9 percent from the previous quarter, while net profit increased by 15.8 percent to 332.1 billion won.

Revenue growth was broad-based, with significant contributions from the cloud business. Sales by segment were search platform 978.4 billion won, commerce 719.0 billion won, fintech 368.5 billion won, content 420 billion won, and cloud 124.6 billion won.

The search platform segment grew 7.5 percent year-on-year and 8.1 percent quarter-on-quarter, boosted by enhancements in product offerings and improved targeting through place ads and search ads.

Commerce increased by 13.6 percent year-on-year and 2.2 percent quarter-on-quarter, driven by higher usage of the “arrival guarantee” and “brand solution” services, along with continued growth of the resale platform Kream. Overall commerce transaction volume hit 12.3 trillion won, up 4.1 percent year-on-year. Naver Plus Membership has also strengthened customer loyalty by offering added value, Naver explained. Meanwhile, Fintech revenue grew 8.5 percent year-on-year and 4.1 percent quarter-on-quarter. Naver Pay‘s transaction volume was17.5 trillion won, up 20.1 percent year-on-year and 5.2 percent quarter-on-quarter, with external transactions exceeding 50 percent of total transactions for the first time.

Content revenue decreased by 0.1 percent year-on-year and 5.9 percent quarter-on-quarter due to yen depreciation. Adjusted for exchange rate effects, global revenue from webtoons grew 11.1 percent year-on-year. In Japan, the segment achieved record high monthly paying users (MPUs) and continued growth. For its part, Cloud revenue rose by 19.2 percent year-on-year and 6.5 percent quarter-on-quarter, driven by artificial intelligence (AI)-related sales and an increase in paid IDs for Line Works. Last month, Naver also launched a digital twin platform project in Saudi Arabia.

“We will focus on accelerating the enhancement of core business products and platforms using AI and data, and proactively uncovering new business opportunities in the second half,” Chief Executive Officer Choi Soo-yeon said.