Seoul: Kakao Corp., the operator of the leading mobile messenger KakaoTalk, announced Thursday that its fourth-quarter net loss has narrowed due to reduced impairment assessments on its content units. The company reported a net deficit of 276.9 billion won (US$190.1 million) for the quarter on a consolidated basis, a significant improvement from a net loss of 1.91 trillion won a year prior, as stated in a regulatory filing.
According to Yonhap News Agency, Kakao's operating profit decreased by 33.7 percent year-on-year to 106.7 billion won, while revenue saw a decline of 2 percent, totaling 1.95 trillion won. The improvement in net loss was largely attributed to a reduction in asset impairment losses from content units acquired in previous years.
Despite an overall drop in quarterly revenue, sales from Kakao's platform business unit increased by 10 percent year-on-year, reaching 1 trillion won, driven by higher revenue from its flagship mobile messenger, KakaoTalk. Conversely, sales from its content business unit decreased by 13 percent year-on-year to 910.1 billion won, due to the underperformance of its gaming, music streaming, and webtoon units.
Looking ahead to 2024, Kakao reported a decrease in net loss to 43.6 billion won from a previous net deficit of 1.81 trillion won. The company's operating profit for the year increased by 6.6 percent year-on-year to 491.5 billion won, with annual sales up by 4.2 percent, totaling 7.87 trillion won.
Kakao also revealed plans to launch a new artificial intelligence (AI) service named Kanana, in partnership with U.S.-based AI giant OpenAI, later this year. "Our joint goal is to popularize AI in the Korean market and make it widely used by domestic users in their daily lives," stated CEO Chung Shin-a during an earnings call. Despite challenges in maintaining the popularity and profitability of AI services in Korea, the company is committed to exploring various strategies to find sustainable solutions.
Earlier in the month, Kakao announced a strategic partnership with OpenAI, with the intention of integrating ChatGPT into its KakaoTalk messenger, which serves over 50 million users, and jointly developing additional AI products.