Revenue hits all-time high for Naver web portal

Naver hit an all-time high for annual revenue in 2019, while the online company’s operating profits declined by nearly 25 percent, company officials announced Thursday.

The country’s leading web portal generated 6.59 trillion won ($5.5 billion) in revenue last year, up 18 percent on year, the company announced Thursday. It was the first time Naver passed the 6 trillion won mark. However, operating profits during the same period slumped 24.7 percent to 710.1 billion won.

That drop resulted largely from aggressive marketing costs Naver had poured into its Japanese affiliate Line to expand its foothold in Japan’s highly competitive market for mobile payments, according to outside securities and investment analysts.

By business segment, content services generated from its webtoon platform and V Live, the live video-streaming service focusing on K-pop stars, recorded the highest growth. The division’s annual operating profit jumped 66.6 percent on year.

The growth in the webtoon and V Live services was prompted by an increase in global users. Growth in content services was also strong in the fourth quarter, with quarterly revenue up 118 percent on year.

“Regarding global sales, there’s been an increase of loyal users in the U.S. market, and our model for paid content is also increasing revenue there as well,” Park Sang-jin, Naver’s chief financial officer, said during a conference call Thursday.

The number of U.S. users that paid to see Naver webtoon’s content increased by threefold by the year’s end compared to early 2019, Park said.

He added that V Live also doubled its revenue on year in the fourth quarter.

Through 2019, Naver spent nearly 700 billion won with a focus on overseas revenue growth. Park said the company will “continue this drive this year and expects to invest 400 to 500 billion won in 2020.” The United States, Europe and Southeast Asia were key target markets.

The company is also preparing to expand financial services in Korea with Naver Financial, a spin-off the Naver Pay team launched November.

“Starting with offering Naver bank accounts from this year’s first half, we plan to offer a wide variety of financial services like security or insurances, making them easily accessible to users that hold a Naver ID,” CEO Han Seong-sook said during the conference call.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]