[THE INVESTOR] Eugine Investment and Securities on July 27 said that Kakao’s second-quarter earnings would miss estimates as the company’s online-to-offline businesses such as Kakao Driver has yet to gain momentum for profitability.

The securities firm predicted the company’s April-July revenue and operating profit at 376.3 billion won (US$331.75 million) and 34.7 billion won, respectively, both missing earlier estimates. 

The suggested price for Kakao was also adjusted from the previous 170,000 won to 130,000 won.

“Investors are skeptical about the O2O business as the company’s new growth engine,” the securities said. “It will take some time for the business to see profitability.”

The Korean Internet giant plans to launch new services such as Kakao Homecleaning and Kakao Parking in the coming months.

By Lee Ji-yoon (jylee@heraldcorp.com)