[Click eStock] "AfreecaTV, Traffic Rebound Expected with This Year's Winter Olympics and World Cup"

[Asia Economy Reporter Lee Jung-yoon] Korea Investment & Securities maintained a buy rating and a target price of 220,000 KRW for AfreecaTV on the 11th, stating that the platform and advertising recorded steady growth.

AfreecaTV posted sales of 75.4 billion KRW and operating profit of 24.6 billion KRW in the fourth quarter of last year. These figures represent increases of 25% and 43.4%, respectively, compared to the same period last year. Platform sales rose 24.7% year-on-year to 55.9 billion KRW, while advertising sales increased 28.6% year-on-year to 17.8 billion KRW.

Jung Ho-yoon, a researcher at Korea Investment & Securities, explained, "The number of paying users (PU) was 246,000, down 12.4% year-on-year, but ARPPU (average revenue per paying user) increased by 42.3% to 226,000 KRW, driving continued revenue growth." He added, "Content-type advertising revenue reached a record high of 11.7 billion KRW, leading the growth in advertising revenue." However, due to the increase in content-type advertising revenue, commission costs and event expenses rose, causing operating expenses to increase 17.8% year-on-year to 50.8 billion KRW.

Researcher Jung forecasted that AfreecaTV’s traffic would rebound and advertising would experience high growth due to sports events. He said, "The decline in monthly active users (MAU) since the fourth quarter of 2020 is a concern," but added, "This year, there are many sports events such as the Winter Olympics, Asian Games, and Qatar World Cup that have positively impacted traffic, so a rebound is expected." He continued, "Platform advertising is also expanding its advertiser base, and the launch performance of the new advertising platform AAM (AfreecaTV Ad Manager) is being fully reflected, so significant growth is expected this year as well."

This content was produced with the assistance of AI translation services.