Naver reported record-high earnings for the third quarter of 2023, fueled by strong performances across its core businesses, including search, e-commerce, and content. During an earnings call, CEO Choi Soo-yeon highlighted the company’s next steps in AI, particularly the planned expansion of its “AI Briefing” feature to mobile devices in 2024.
AI Briefing Expansion to Mobile
Naver’s AI Briefing, which generates direct, contextual answers to search queries, will soon be available on mobile, marking a significant update for the company’s generative AI capabilities. According to Choi, AI Briefing is evolving to better understand user intent and deliver answers quickly and accurately. Naver has completed internal testing of multimodal functions, enabling searches through both images and voice.
“Our goal for next year is to offer an immersive mobile experience through AI Briefing, providing data summaries from reliable sources and aligning responses with users’ search objectives,” Choi said.
Strong Financial Performance in Q3
Naver’s operating profit for Q3 grew 38.2% year-over-year, reaching 525.3 billion won ($379.9 million), with sales rising 11.1% to 2.71 trillion won. Both figures surpassed market expectations from analysts at FnGuide, who forecasted a 493.5 billion won operating profit and 2.66 trillion won in sales. The company also reported a net profit of 530.1 billion won, marking a 48.8% increase from the previous year.
This quarter marked the eighth consecutive period of growth for Naver’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA), which rose 27% year-over-year to 699.2 billion won. The company attributed its financial success to continued growth in its search and advertising sectors.
Performance Across Key Business Units
Naver’s search platform unit, its primary revenue source, recorded an 11% year-over-year increase in sales to 997.7 billion won. This growth was driven by new ad targeting capabilities, enhanced user engagement with short-form content, and the expansion of various service areas.
The company’s commerce division saw a 12% increase in sales, reaching 725.4 billion won, while its fintech sector achieved a 13% rise in revenue to 385.1 billion won. Naver’s content business experienced a 6.4% revenue increase to 462.8 billion won, and its cloud business grew 17% to 144.6 billion won.
Future Growth and AI-Driven Innovation
Naver plans to continue advancing its AI capabilities, using generative AI to personalize user experiences and expand services both online and offline. CEO Choi noted that AI will play a crucial role in enhancing Naver’s platforms, covering areas such as location services, real estate, and digital twin technology.
“Naver is leveraging AI to refine its search and data capabilities, which allows us to deliver ultra-personalized experiences to users,” Choi said. “By applying generative AI across different facets of our business, we’re identifying new opportunities and creating future growth engines.”
With these financial results and plans for AI integration, Naver is set to continue its upward trajectory and maintain its competitive edge in the rapidly evolving AI landscape.