During Naver’s earnings conference on Friday, CEO Choi Soo-yeon expressed the company’s determination to strengthen its services based on generative artificial intelligence (AI), with the aim of expanding into the global market. Naver, a prominent information technology giant, plans to enhance its key businesses, such as search engines and commerce platforms, by leveraging AI and data. The company’s focus is on improving the user experience by providing hyperpersonalized content through generative AI technology.
One significant development mentioned by Choi is the expansion of Cue, a generative AI search service that was launched in September of last year. While initially limited to PC-integrated search, Choi hinted that Cue would soon be available on users' smartphones within the first half of this year. Naver also plans to incorporate multimodal technologies that can accept both image and textual input, further enhancing the user’s search experience. These advancements are part of Naver’s strategy to offer more innovative and tailored content to its users.
Choi emphasized that these efforts to enhance the user experience will ultimately contribute to greater profitability for the company. Naver’s recently released reports on its earnings for 2023 revealed impressive results, with record-breaking numbers in both profit and sales. The company reported an operating profit of 1.49 trillion won ($1.13 billion) for 2023, marking a 14.1 percent increase compared to the previous year. Net profit and sales also experienced significant growth, rising by 46.8 percent and 17.6 percent year-on-year, respectively. Naver’s adjusted earnings before interest, tax, depreciation, and amortization reached an all-time high of 2.13 trillion won in 2023, reflecting an 18.4 percent increase compared to the previous year.
Looking specifically at the fourth quarter of 2023, Naver saw strong overall performance, primarily driven by the growth of its commerce and fintech businesses. The company reported an operating profit of 405.5 billion won for the October-December period, a 20.5 percent increase year-on-year. Net profit and sales also showed substantial growth, increasing by 129 percent and 11.7 percent, respectively, compared to the same period in the previous year.
Naver’s flagship search platform business saw a 1.3 percent increase in sales, reaching 928.3 billion won in the fourth quarter of 2023, primarily due to high demand for search advertisements. The commerce and fintech businesses also performed well, with sales of 660.5 billion won and 356 billion won, respectively. The content and cloud businesses generated sales of 466.3 billion won and 125.9 billion won, respectively.
In terms of shareholder returns, Naver plans to distribute a total of 118.9 billion won in cash dividends. Market analysts predict that Naver will continue to achieve record-breaking earnings in 2024. According to a consensus projection provided by market intelligence firm FnGuide, Naver is expected to report an operating profit of 1.72 trillion won, with net income of 1.41 trillion won and sales of 10.83 trillion won for the year.
As Naver continues to strengthen its generative AI capabilities and expand its global reach, it is clear that the company’s focus on enhancing the user experience through personalized content is driving its success. With record-breaking earnings in 2023 and promising projections for the future, Naver is poised to solidify its position as a global technology giant.
Use the share button below if you liked it.