Naver reports record results for 2021

Naver Webtoon's office at the company's headquarters in Bundang, Gyeonggi [JOONGANG PHOTOI]

Last year was Naver's best yet, with record sales and profits led by robust growth in content, digital payments and one-time gains from a change in its corporate structure.

The tech company’s 2021 net profit soared by 1,842 percent to 16.4 trillion won ($13.6 billion) compared to the previous year. The establishment of a joint venture with SoftBank accounted for a lot of that profit, according to a spokesperson for Naver. The one-time gain was estimated at around 14 trillion won by Yuanta Securities.

But operating profit grew 9.1 percent to 1.3 trillion won, an all-time record and in line with projections.

Sales for the year rose 28.5 percent to 6.8 trillion won, breezing past a market consensus of 6.7 trillion won compiled by FnGuide.

The highlight of last year’s performance was steep growth in new businesses such as webtoon and social media services like Zepeto, adding to revenues from the company's cash cow of advertising revenues from search.

The content business, which includes webtoon, Zepeto and camera app-focused Snow, reported a 50.6 percent increase in sales last year to 692.9 billion won, driven by growth in Naver Webtoon. The webtoon service had over 1 trillion won in revenues from subscribers, according to the company.

Fintech-related revenues rose 44.5 percent to 979 billion won, with more stores using Naver Pay and a growing user base for the payment service. Total transactions on Naver Pay reached 10.9 trillion won as of the end of last year.

The commerce business, built around Naver’s shopping platform, grew 35.4 percent to 1.5 trillion won in sales in 2021 over a year ago. Livestreaming helped boost sales, with transactions quadrupling from a year earlier.

“For this year, we plan to further expand product categories for Shopping Live and introduce a standalone application,” said Naver’s CFO Park Sang-jin during a conference call on Thursday.

The cloud business also flew high with annual sales rising 38.9 percent to reach 380 billion won.

Revenue from search-based advertising grew at a slower pace. It rose 17.4 percent to reach 3.3 trillion won on year.

For the fourth quarter, Naver posted 1.9 trillion won in sales, up 27.4 percent on year, matching the market consensus. Operating profit jumped 8.5 percent to 351.2 billion won, below an expectation of 366.4 billion won.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]