[Market Highlight] Kakao Surges Over 5% on Expectations for Earnings Growth from KakaoTalk Overhaul

Kakao is showing strong performance in early trading on the 19th. Investor interest appears to be surging ahead of a major app overhaul aimed at transforming KakaoTalk from a messenger-centric structure into a social platform.

As of 9:29 a.m. on this day, Kakao is trading at 68,000 won, up 3,300 won (5.10%) from the previous trading day.

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From September 23, Kakao will hold its developer conference, "If Kakao," for three days, where it plans to announce the KakaoTalk overhaul, new artificial intelligence (AI) services, and joint products with OpenAI.

The industry expects the main highlight to be the results of its collaboration with OpenAI, as the introduction of ChatGPT-based features to KakaoTalk is expected to accelerate the "popularization of AI."

During this If Kakao event, Kakao will unveil its KakaoTalk overhaul plan, which will transform the Friends tab into a "social feed" and the Open Chat tab into a "short-form content hub." Internally, the company aims to increase user time spent on KakaoTalk by more than 20% and establish a new revenue model centered on feed-style advertising, targeting a rebound in Talk Biz sales in the fourth quarter.

An Jaemin, a researcher at NH Investment & Securities, explained, "With the overhaul of KakaoTalk, we expect increased user engagement time and higher advertising revenue from the fourth quarter. The integration of ChatGPT through the partnership with OpenAI is expected to elevate Kakao's competitiveness as an AI-based mobile platform."

Researcher An added, "The tab overhaul and ChatGPT integration are expected to drive increased traffic and advertising revenue for KakaoTalk. We forecast Kakao's advertising revenue in 2026 to grow by 14% year-on-year, reaching 1.45 trillion won."

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