NHN Reports Q1 Operating Profit of 19.1 Billion KRW, Up 23% YoY

NHN recorded solid results in the first quarter of 2023, driven by growth in its gaming business.

On the 11th, NHN announced that it posted sales of 548.3 billion KRW and an operating profit of 19.1 billion KRW in Q1. These figures represent increases of 5.4% and 23.1%, respectively, compared to the same period last year. Net profit turned positive at 25.6 billion KRW.

Looking at sales by segment, the gaming division recorded 117 billion KRW, up 7.6% year-on-year and 7.5% quarter-on-quarter, boosted by the Lunar New Year peak season and record quarterly sales of mobile webboard games. Webboard games continued their growth trend with total webboard game sales increasing 26.6% year-on-year and mobile webboard game sales rising 46.6% year-on-year.

The payment and advertising segment posted 249.4 billion KRW, up 19.2% year-on-year and 5.2% quarter-on-quarter, supported by increased offline payment and coupon sales as well as higher transaction amounts from major domestic merchants through NHN KCP. PAYCO’s transaction volume in Q1 reached 2.7 trillion KRW, showing continuous growth despite marketing efficiency improvements. Offline payment amounts increased 54% year-on-year, and PAYCO coupon sales rose 38% year-on-year, contributing to PAYCO’s profitability enhancement.

The commerce segment recorded 50.6 billion KRW, down 51.7% year-on-year and 31.6% quarter-on-quarter, due to delayed recovery in Chinese consumer sentiment and contraction in the U.S. retail market. The content segment posted sales of 41.8 billion KRW, down 10.9% year-on-year and 15.5% quarter-on-quarter.

The technology segment continued its growth with a 57.3% year-on-year increase, driven by public sector achievements and large client orders from Japan’s NHN Tecorus. However, sales declined 4.6% quarter-on-quarter to 100.1 billion KRW due to a high base effect from public sector sales concentrated in the previous quarter. Japan NHN Tecorus contributed to sales growth with a 31.0% year-on-year and 10.7% quarter-on-quarter increase.

NHN plans to lead growth in the webboard game market with differentiated content unique to Hangame. The new title, “Darkest Days,” is scheduled to begin pre-registration in Q3 and launch globally within the year.

NHN PAYCO is reorganizing its organization and services around core businesses to improve sales by segment and focus on efficient cost execution. The strategy includes expanding payment synergy between offline payments and PAYCO points. The scope of PAYCO coupon services provided to major card companies will also be expanded through new business initiatives.

NHN Cloud, which celebrated its first anniversary in April, is focusing on cloud transition projects in the public sector and aims to create synergy in the AI domain based on the Gwangju National AI Data Center, which will open in the second half of the year. It is currently developing a customized generative AI platform for enterprises targeting the public and financial markets, based on cloud infrastructure.

Jung Woo-jin, CEO of NHN, said, “The first quarter of this year was a period in which we achieved both visible profit improvement and continuous top-line growth. We will strive to enhance NHN’s corporate value by capturing both growth and soundness in key businesses such as gaming, technology, payment, commerce, and content, while establishing a sound governance structure through ESG management.”

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