Kakao Reports 15.5% Increase in Q3 Operating Profit

Kakao Corp., a leading South Korean internet technology firm, reported a significant 15.5% increase in its operating profit for the third quarter of 2023. This rise is attributed to the stable growth of its platform business, which has shown resilience despite economic fluctuations.

In its regulatory filing, Kakao stated that its consolidated operating profit reached 240.3 billion won (approximately $179.2 million) during the July to September period. The company's sales remained steady at 2.08 trillion won, while net income experienced a decline of 7.9% to 177.7 billion won.

The platform business, a key driver for Kakao, saw sales surge by 17% year-on-year, totaling 1.24 trillion won. Notably, the commerce segment of this business grew by 13%, benefiting from increased transactions on the KakaoTalk platform during the Chuseok holiday.

Kakao's ride-hailing and payment services also contributed to this growth, generating sales of 602.1 billion won, marking a 21% increase from the previous year. However, the content segment faced challenges, with sales dropping by 6% due to fewer new album releases and concert events.

CEO Chung Shin-a acknowledged the slower-than-expected growth in AI services but expressed optimism about future developments. The company plans to enhance its AI offerings, including the upcoming launch of its AI assistant, Kanana Space, in December. Additionally, Kakao announced a share buyback plan worth 150 billion won to enhance shareholder value.