November 21, 2024

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Naver's headquarters building in Seongnam, Gyeonggi Province (Newsis)

South Korean internet giant Naver on Friday reported record-high quarterly earnings for the July-September period, showing strong performances in all of its major businesses including the search platform, commerce and content.

During an earnings call, Naver Chief Executive Officer Choi Soo-yeon said the company will expand "AI briefing" to mobile-integrated search next year. The feature provides direct answers to search queries by understanding user intent and context based on extensive and up-to-date data.

“Naver’s generative AI search has focused on enhancing response speed and quality," she said. “It is continuously evolving, with internal testing completed on multi-modal functions that can search through images and voice."

"Next year, we aim to offer an immersive experience on mobile, providing actions aligned with search purposes, such as AI briefings summarizing data from reliable sources,” she added.

In the third quarter, operating profit grew 38.2 percent on-year to 525.3 billion won ($379.9 million) and sales rose 11.1 percent to 2.71 trillion won.

Both operating income and sales were higher than the local analyst consensus of 493.5 billion won and 2.66 trillion won, respectively, provided by market intelligence FnGuide.

Net profit jumped 48.8 percent on-year to 530.1 billion won for the three months ending in September.

Adjusted earnings before interest, taxes, depreciation and amortization came to 699.2 billion won, up 27 percent from a year earlier and marking eight consecutive quarters of growth. The company attributed steady revenue growth to its strong performance in search and advertising businesses.

Its mainstay search platform unit saw sales grow 11 percent on-year to 997.7 billion won, driven by extended user engagement through short-form and feed services, the expansion of new service areas and improvements in ad product targeting.

Sales from the commerce unit rose 12 percent on-year to 725.4 billion won, and revenue from the fintech unit improved 13 percent on-year to 385.1 billion won.

The content business also saw its revenue increase 6.4 percent on-year to 462.8 billion won, and sales from the cloud business gained 17 percent on-year to 144.6 billion won.

“Naver is enhancing its search capabilities based on artificial intelligence and data, expanding ultra-personalized services tailored to user interests and advancing platform sophistication. We are applying generative AI to offline and online experiences like place, maps, real estate and digital twin to explore future growth engines and create new business opportunities,” the CEO said.

By Jie Ye-eun (yeeun@heraldcorp.com)