Seoul: Kakao Corp., the operator of South Korea's leading mobile messenger service, announced a remarkable 113 percent increase in its third-quarter net income compared to the previous year, attributing this growth to a base effect. For the July-September timeframe, the company's net profit reached 78.5 billion won (approximately US$56 million), up from 36.8 billion won during the same period last year, as reported in a regulatory filing.According to Yonhap News Agency, while Kakao's operating income saw a 5 percent rise year-on-year to 130.5 billion won, its sales encountered a decline, dropping 4.5 percent to 1.92 trillion won. These earnings fell short of market expectations, as analysts had projected an average net profit of 94.6 billion won, based on a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.The company explained that the notable increase in net profit was largely due to a base effect stemming from high operating costs recorded in the third quarter of last year, along with recent divestments of some subsidiaries. Despite the growth in net profit, Kakao faced a decrease in sales, primarily due to the underperformance of its content business unit.Revenue from the content division decreased by 14 percent year-on-year to 977.9 billion won, with declines seen across games, music, and story, including webtoons. Conversely, the platform business unit experienced a 7 percent revenue growth year-on-year, totaling 943.5 billion won, driven by increased revenue from the mobile messenger KakaoTalk.In detail, KakaoTalk generated a 6 percent increase in advertisement revenue, amounting to 507.3 billion won, while revenue from its e-commerce function climbed 8 percent to 215.1 billion won. Revenue from other platforms, such as Kakao Pay and Kakao Mobility, grew 13 percent year-on-year to 359.8 billion won.During a conference call, Kakao revealed its plans to venture into new growth areas, specifically in artificial intelligence and healthcare. The company intends to launch its new AI agent, Kanana, along with other related services next year. Additionally, for Pasta, a glucose management application developed by Kakao Healthcare, the company anticipates achieving operating profitability by 2026.Kakao has been navigating a management crisis this year, following charges against its founder Kim Beom-su for his alleged involvement in suspected stock manipulation during the company's attempted takeover of SM Entertainment in February last year. Adding to the challenges, on Wednesday, Kakao Mobility Corp., the taxi-hailing service arm of the company, faced a fine of 3.4 billion won due to allegations of accounting fraud.
- October 12, 2026
