Seoul: Naver Corp., South Korea's largest online portal operator, announced a significant decline in its first-quarter net profit by 23.8 percent compared to the previous year, attributing the drop to a one-off factor. The company reported a net income of 423.7 billion won (approximately US$303.5 million) for the January-March period on a consolidated basis, a decrease from 555.8 billion won recorded in the same period last year, as stated in a regulatory filing.
According to Yonhap News Agency, the earnings fell short of market expectations, with analysts projecting an average net profit of 439.7 billion won, based on a survey conducted by Yonhap Infomax, the financial data firm of Yonhap News Agency. Despite the drop in net income, Naver's operating profit for the quarter increased by 15 percent year-on-year to 505.3 billion won, while sales rose 10.3 percent to 2.78 trillion won.
Naver attributed the decline in net profit to a one-off factor concerning its database unit, Naver Z Corp., which was removed from a consolidated balance sheet last year. Despite this, the company's flagship search platform unit experienced a sales growth of 11.9 percent year-on-year, reaching 1.01 trillion won, driven by efforts to enhance platform competitiveness through artificial intelligence.
Furthermore, the company's commerce unit saw a 12 percent increase in sales to 787.9 billion won, while revenue from the financial technology unit improved by 11 percent to 392.7 billion won. The content unit's revenue advanced by 2.9 percent to 459.3 billion won, and sales from the enterprise business rose by 14.7 percent to 134.2 billion won.