Kakao surpassed 4 trillion won in sales for the first time last year. Operating profit also hit a record high. KakaoTalk-based flagship business has grown significantly. Kakao plans to continue its growth this year by aggressively expanding its new business.
Operating margin exceeded 10%
Kakao announced on the 9th that it posted KRW 4.156.7 trillion in consolidated sales last year. It has increased by 35% from a year ago. Kakao has been showing rapid growth as the number of trillion units of sales has changed every year since 2017. Last year’s operating profit increased 121% from the previous year to 458 billion won. This is the first time that the operating profit exceeded 400 billion won. The operating margin was 11%, surpassing 10% for the first time since the merger with Kakao in 2014.
Kakao’s good performance was led by Talkbiz, a Kakao Talk business. Last year, related sales amounted to 1,117.8 billion won. It increased by 72% compared to the previous year. The Talkbiz division accounted for 27% of Kakao’s total sales. This is thanks to the increase in sales of Biz Board, the billboard at the top of the Kakao Talk chat window. Kakao Co-CEO Yeo Min-soo explained in a conference call (telephone conference) that was held after the announcement of the results, “The average daily sales of Biz Board in December of last year reached 1 billion won, which doubled from the previous year.” Kakao Commerce’s fourth quarter transaction volume, including KakaoTalk’s online shopping service’Give a Gift’ and’Talk Store’, increased 71% from a year ago.
New business sectors such as mobility, simple payment, and information technology (IT) services also grew significantly last year. It recorded 5501 billion won, an increase of 111% from the previous year. CEO Yeo said, “The annual transaction amount of Kakao Pay reached 67 trillion won, a 40% increase over the previous year.” Last year’s sales of the paid content division increased by 78% compared to the previous year to 528 billion won, which grew rapidly. The annual transaction value of the webtoon Piccoma, operated by Kakao in Japan, recorded 4146 billion won, an increase of 188% from a year ago. However, portal service sales such as Daum, a portal service, fell 9% from the previous year to KRW 477.8 billion.
Attack management this year
Kakao plans to reinforce its flagship business again this year. Kakao Talk’s advertising business, which led last year’s good results, will be expanded. CEO Yeo emphasized, “This year’s Talkbiz sales are expected to increase by 50% compared to the previous year.” Overseas markets are strengthening their targeting with webtoons. Jae-Hyun Bae, Chief Investment Officer of Kakao (CIO), explained, “Kakao Page, which will expand its global platform network in earnest this year, will record a combined transaction amount of over 700 billion won.” did.
The entertainment business is also strengthened. Kakao’s related subsidiaries, Kakao Page and Kakao M, merged in March this year to newly launch Kakao Entertainment. CEO Yeo said, “With the merger of the two companies, we will combine the intellectual property (IP) business capabilities that have been established in their respective fields to Kakao Entertainment. I will do it.” Based on Kakao’s proprietary IP such as webtoons and web novels, the strategy is to directly produce dramas and movies as actors belonging to Kakao M.
On this day, Kakao announced that the total manpower of Kakao and its affiliates increased from 10,000 to 10,644 for the first time. CIO Bae said, “Including new recruits, more than 2,000 new employees per year have increased, creating a great deal of employment even in the difficult situation of the spread of the novel coronavirus infection (Corona 19).”
Reporter Kim Joo-wan [email protected]
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