Declining ad revenue hits Daum hard in latest quarter

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Declining ad revenue hits Daum hard in latest quarter

Daum Communications, the operator of Korea’s second-most visited search engine, said yesterday its third-quarter earnings tumbled 41 percent on-year due to a decline in advertising revenue and increased costs.

Net profit came to 19.2 billion won ($17.6 million) in the July-September period, compared with a profit of 32.4 billion won a year earlier, the company said in a regulatory filing.

Sales rose 6.2 percent on-year to 109 billion won over the cited period, while operating profit dipped 23 percent to 22.2 billion won.

The protracted economic slump and a decline in an online search-advertising service offered by Yahoo’s Overture Services were cited as the reasons for the weak performance.

Sales from display advertising gained 8 percent on-year to 54.7 billion won over the cited period, but its search advertising sales fell 6.5 percent to 44.6 billion won.

Daum said earlier it will not renew its contract with Yahoo’s online search advertising service when it expires next year.

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