Kakao Surpasses 8 Trillion Won in Revenue Last Year... Profitability Declines (Comprehensive)

Record High Sales of 8.1058 Trillion Won Last Year
Operating Profit Decreased by 11% to 501.9 Billion Won

Kakao surpassed 8 trillion won in sales last year, but profitability deteriorated due to increased expenses.

On the 15th, Kakao announced that its consolidated sales for the fourth quarter of 2023 reached 2.1711 trillion won, a 23% increase compared to the same period last year. Operating profit was recorded at 189.2 billion won, a 109% increase year-on-year.

Last year, the annual consolidated sales reached 8.1058 trillion won, a 14% increase from the previous year, marking the first time annual sales exceeded 8 trillion won. However, operating profit decreased by 11% to 501.9 billion won. The operating profit margin was 6.2%.

By business segment, platform sales last year were 4.096 trillion won, a 9% increase compared to the previous year.

Talk Biz sales recorded 2.109 trillion won, an 11.3% increase year-on-year. Based on the evolution of KakaoTalk, including service restructuring, the profitability of advertising and commerce businesses improved. Among these, Talk Biz advertising-type sales such as Biz Board and KakaoTalk Channel reached 1.12 trillion won, a 6% increase from the previous year. This was due to increased advertiser demand from improved visibility on the Friends tab and growth in advertisers and channel friends following the introduction of Talk Channel. Talk Biz transaction-type sales, including Gift and Talk Store, increased by 18% to 989 billion won, influenced by the expansion of premium gift lineups and strengthened personalized marketing.

Portal Biz sales decreased by 19% to 344 billion won compared to the previous year. The Portal Biz division, which transitioned to an internal startup, is striving to improve profitability by enhancing advertising operation efficiency through partnerships with global partners. Other platform sales increased by 14% to 1.643 trillion won. Mobility sales rose due to a surge in year-end travel demand, and Pay sales increased with the growth of overseas payments.

Content division sales last year were 4.01 trillion won, a 20% increase year-on-year. Story sales remained similar to the previous year at 922 billion won. In the Story division, Kakao Entertainment’s revenue declined due to a focus on profitability. Although the Japanese digital comic platform Piccoma saw increased transaction volume, sales converted to Korean won decreased due to the weak yen. Music sales rose 93% year-on-year to 1.725 trillion won, reflecting the impact of acquiring SM Entertainment. Media sales decreased by 14% to 355 billion won due to differences in production progress. Game sales fell 9% to 1.009 trillion won.

Annual operating expenses increased by 16% to 7.6039 trillion won. Revenue-linked costs rose 17.3% year-on-year to 3.112 trillion won, and outsourcing and infrastructure costs increased 23.1% to 1.138 trillion won.

Kakao continues to pursue projects aimed at evolving KakaoTalk into a comprehensive communication service by restructuring the service and improving user convenience. Going forward, Kakao plans to combine KakaoTalk with artificial intelligence (AI) to expand positive user experiences. Based on this, the company intends to strengthen a virtuous cycle structure to ensure continuous growth in Kakao’s core businesses such as advertising and commerce.

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