Naver and Kakao, South Korea’s two major Internet platforms, posted record-breaking performances in the third quarter of this year. The reports prove their specials in the industry following the outbreak of new coronavirus pandemic.
Naver recorded 1.36 trillion won in consolidated sales in the third quarter of this year. As it grows 24.2 percent in just one year. And Naver has its Japanese subsidiary, Line, which worth 2.59 trillion won. Therefore, in total, Naver has surpassed the 2 trillion won barrier in quarterly sales for the first time.
It has doubled in exactly four years since its sales first exceeded 1 trillion won in the third quarter of 2016.
Meanwhile, its competitor, Kakao announced on the 5th that its sales for this quarter amounted to 1.14 trillion won. It is up 41 percent from the same period last year. And it has also surpassed 1 trillion won for the first time in history.
It took just three years for the company to double its growth since it recorded 500 billion won in sales in the third quarter of 2017.
Both companies cited their quick adaptation to the sudden advent of the physical distancing era following the COVID-19 pandemic, as the key to improving their performance.
Naver and kakao are focusing on new businesses
In fact, the sales structure of the two companies is rapidly changing, focusing on new businesses.
Naver’s new business sector, including shopping, finance, cloud, and content, showed high growth of 30 to 60 percent in the third quarter of this year. With its share of total sales rising to 48 percent. Sales of its current major businesses, such as search and advertisement, only grew by single digits.
Based on the success of Kakao Talk-related businesses, Kakao also saw its sales in new business sectors such as mobility and simple payment increase 139 percent from last year. Hence driving overall earnings growth. On the other hand, sales from the portal business fell 4 percent from last year.
The two companies are investing heavily in shopping, simple payment, and webtoons as next-generation growth engines. And they are also making visible results in some businesses. Some predict that the current high growth trend will continue for the time being.
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