NHN (181710) Q3 2024 earnings summary

Executive summary

• Q3 consolidated revenue reached KRW 1,812.2 billion, up 8.4% year-over-year, but operating profit turned to a loss of KRW 57.6 billion from a profit in the prior year.

• Net loss attributable to owners was KRW 110.5 billion, with a basic EPS of -2,101 won for the period.

• A one-off bad debt write-off related to TMON and WeMakePrice led to a significant operating loss; excluding this, operating profit was KRW 27.3 billion, up 16.8% year-over-year.

• The business is diversified across games, payments/advertising, commerce, cloud, content, and music, with payments/advertising accounting for the largest revenue share.

• Payment and tech segments showed resilience, with tech revenue up 7.6% year-over-year and 4.7% quarter-over-quarter.

Financial highlights

• Revenue: KRW 1,812.2 billion for Q3 2024, up 8.4% year-over-year.

• Operating loss: KRW 113.4 billion due to a KRW 140.7 billion one-off bad debt expense; excluding this, operating profit was KRW 27.3 billion, up 16.8% year-over-year.

• Net loss: KRW 110.5 billion, compared to a net loss of KRW 23.1 billion in Q3 2023.

• Game revenue was KRW 112.5 billion, up 2.1% year-over-year and 5.7% quarter-over-quarter.

• Payment and advertisement revenue reached KRW 292.6 billion, up 10.3% year-over-year.

• Tech revenue was KRW 102.7 billion, up 7.6% year-over-year and 4.7% quarter-over-quarter.

• Cash and cash equivalents at period end: KRW 646.1 billion.

Outlook and guidance

• Game business targets 20–30% top-line growth in 2025, driven by global web board expansion and mid-core genre diversification.

• Payment business expects a decrease in prepaid transaction volume but aims to offset with growth in CLO and B2B segments.

• Tech segment anticipates strong growth in public sector cloud projects and AI services, leveraging new certifications and infrastructure.

• Webtoon and content business is expected to grow, with 125 internally produced works since 2022 and ongoing global expansion.

• The company plans to maintain shareholder returns through dividends and share buybacks, with a 2025 policy announced.