Kakao finishes 2019 with record earnings

2020.02.13 10:21:16 | 2020.02.13 15:31:43

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South Korea’s largest messenger app operator Kakao Corp. reported record results last year, powered by roaring new businesses in taxi and mobile payment and steady revenue streams from its flagship messenger platform.

Consolidated operating profit in the final quarter of 2019 surged to 79.4 billion won ($67.1 million) from 4.29 billion won a year earlier, according to the company’s earnings guidance released Thursday.

Sales jumped 28.8 percent on year to 867.3 billion won.

For the entire year, operating profit soared to 206.6 billion won from 72.9 billion won a year ago and revenue climbed 27.8 percent to 3.09 trillion won, both record highs.

Kakao shares finished Thursday 4.07 percent higher at 179,000 won.

The company attributed the stellar results to KakaoTalk messenger’s robust business model and strong profitability of new business ventures.

Its platform division raked in sales of 440 billion won in the fourth quarter, a 47 percent increase from a year earlier.

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Sales of new businesses surged 95 percent to 88.2 billion won, driving overall platform sales. Demand for its KakaoT Driver service shot up in the year-end as people hired designated drivers to take them home after drinking gatherings. Services of its taxi-hailing app KakaoT Blue also expanded in the final quarter. Its mobile payment service KakaoPay also saw a rise in transactions and increased returns in its financial products.

KakaoTalk Biz sales rose 73 percent to 221.6 billion, thanks to the banner ad placements on its messenger app and record high ecommerce transactions.

Portal sales edged up 3 percent to 134.2 billion won, helped by a seasonal bump-up in advertising.

Banner ads on KakaoTalk messenger [Photo provided by Kakao Corp.]이미지 확대

Banner ads on KakaoTalk messenger [Photo provided by Kakao Corp.]

The contents division delivered sales of 423.3 billion won in the final quarter, up 14 percent on year.

Game content sales rose 6 percent to 105.9 billion, led by the October release of its new game, The Legendary Moonlight Scultor. Music content sales also gained 9 percent to 153.3 billion won.

Revenue generated from paid contents fell 25 percent to 47.8 billion won due to changed accounting standards of its online comic platform Piccoma.

Kakao said it plans to broaden its fintech presence through KakaoPay, KakaoBank and Kakao and accelerate efforts take its paid contents global.

By Kim Hyo-jin

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]