Kakao’s third-quarter revenue reaches a record 783.2 billion won ($672 million) thanks to remarkable growth in its ad business on KakaoTalk
Korean internet giant Kakao announced a significant increase in its third-quarter earnings Thursday, backed by the growth of its advertisement platform on popular messenger app KakaoTalk.
The company reported that sales in the July-September period reached a quarterly record of 783.2 billion won ($672 million) -- a 40 percent increase on-year.
It also posted its highest operating profit since 2015 at 59.1 billion won. That was a 93 percent increase from a year earlier and 46 percent over the previous quarter, the company added.
Kakao’s co-CEO Yeo Min-soo attributed its robust quarterly performance to the growth in its mobile ad business via KakaoTalk. KakaoTalk Biz Board posts ads that can reach 44 million subscribers in Korea.
“We are confident of earning daily revenue of 400 million won to 500 million won at Kakao Talk Biz Board by the year-end,” Yeo said in a conference call. “While keeping up this trend, we will expand our business portfolio through the KakaoTalk-based ecosystem.”
KakaoTalk Biz Board posted revenue of 162.4 billion won in the third quarter -- a 17 percent on-quarter increase and 52 percent fries on-year.
Given that Kakao’s mobile ad platform’s accumulated operating profit amounted to 408.3 billion won, Yeo anticipates its annual sales will surpass 600 billion won and reach 1 trillion won next year.
Kakao Biz Board began its open beta service last month.
“The number of advertisers has increased by 1,000 since we started the open beta service last month,” Yeo said. “It’s fair to say that long-tail advertisers have started to hop on board.”
Kakao’s various business portfolios, such as mobile finance, online content and mobility services, also showed robust performance, the company added.
In terms of the content business, such as webtoons, Kakao’s revenue recorded 432.4 billion won during the period -- 25 percent increase on-year and 6 percent rise on-quarter.
The company’s new business platforms -- such as the Kakao Pay and Kakao Taxi -- also witnessed sturdy growth. Their total revenue reached 62.3 billion won, a twofold increase from a year earlier, Kakao said.
“The rapid growth of Kakao’s new businesses stems from Kakao Pay’s rapid expansion to places where mobile payment is available,” the company said. “Increased sales of Kakao-based financial products also played a role in the growth.”