NAVER (035420) Q3 2024 earnings summary

Executive summary

• Q3 revenue rose 11.1% YoY and 4% QoQ to KRW 2.72 trillion, driven by accelerated growth in search, commerce, and fintech, with operating profit hitting an all-time high of KRW 525.3 billion, up 38.2% YoY and 11.1% QoQ.

• Net profit grew 48.8% YoY and 59.6% QoQ to KRW 530.1 billion, aided by bond translation gains.

• Adjusted EBITDA increased for the eighth consecutive quarter, with margin at 25.7%.

• Operates Korea's top internet portal with diversified business in advertising, commerce, fintech, content, and cloud, and a global presence through acquisitions and partnerships.

• Maintains strong credit ratings (AA+/A3/A-) and robust liquidity.

Financial highlights

• 3Q24 revenue: KRW 2,715.6 billion; operating profit: KRW 525.3 billion; net profit: KRW 530.1 billion.

• Adjusted EBITDA: KRW 699.1 billion (+27% YoY); margin: 25.7%.

• Search platform revenue grew 11% YoY to KRW 997.7 billion; commerce revenue up 12% YoY to KRW 725.4 billion; fintech revenue up 13% YoY to KRW 385.1 billion.

• Content revenue up 6.4% YoY to KRW 462.8 billion, with Webtoon revenue up 11.6% YoY.

• Cloud revenue rose 17% YoY to KRW 144.6 billion.

Outlook and guidance

• Management expects continued acceleration in search platform growth into next year, leveraging AI and feed expansion.

• Focus on global expansion, especially in content and commerce, with continued investment in AI and cloud.

• Margin improvement is expected to continue, supported by structural changes and profitable growth focus.