Naver's Profits Plummet
27 October, 2018
Korea's largest portal Naver has seen its operating profit plunge for four consecutive quarters due to slow growth in mobile advertising and hefty investment in new businesses.
Naver on Thursday posted sales of W1.39 trillion in the third quarter, up 16.4 percent from last year, but operating profit plunged 29 percent to W221.7 billion. Operating profit in the third quarter last year stood at W312.1 billion but has been falling since.
The decline was largely attributed to the poor performance on paper in new businesses including messaging app Line, which posted a deficit of W54.6 billion. But that was due to massive investments in new technologies such as fintech and machine-learning technology.
But Naver CEO Han Seong-sook admitted that growth has slowed due to the economic slump and sluggish growth in the mobile market. "We will be able to gain competitiveness by securing new technologies and making inroads into overseas markets," she added.
Meanwhile, Naver said it will complete an overhaul of its mobile site this year to make it less susceptible to online opinion-rigging. It added it is considering setting up an online-only bank but has not decided anything.