South Korea's two biggest platform companies, Naver and Kakao, are expected to post record results. Naver is likely to top 2 trillion won in annual operating profit on balanced growth in core businesses such as commerce and advertising. Kakao's operating profit is estimated to rise more than 50 percent from a year earlier, helped by aggressive restructuring and cost efficiency.

FnGuide said on Jan. 15 that Naver's 2025 annual revenue is expected to total 12.11 trillion won, up 12.7 percent from a year earlier. Operating profit is forecast to rise 11.2 percent to 2.2 trillion won, likely opening a new era of annual operating profit above 2 trillion won for the first time. Kakao is also expected to post annual revenue of 8.14 trillion won, up 3.5 percent, and operating profit of 706.0 billion won, up 53.4 percent, with profitability seen improving sharply.

Naver: 'Commerce and advertising' synergy effect; spillover gains from rival issues also seen

Naver's strong performance was led by growth in its commerce segment. In the securities industry, analysis says changes in traffic and transaction volume at Naver Shopping were observed in some indicators after a rival faced a controversy over a data leak. The 'Naver Plus Store' app, launched in March last year, is also seen as having settled into the market and driven an expansion in transaction volume.

Naver is also fleshing out strategies to convert incoming traffic into loyal customers. Donghwan Oh, an analyst at Samsung Securities, said Naver is boosting delivery competitiveness by steadily expanding N-delivery coverage, currently at about 15 percent, and plus-membership partners. With effects including a Spotify tie-up, paid membership subscribers in November were found to have risen more than 20 percent from the previous month.

Its advertising business (search platform) also extended growth as efficiency improved with the adoption of AI technology. The industry sees increased commerce transactions and advertising demand combining with efficiency gains at the search platform to play a buffering role for overall quarterly results. Analysis says the AI advertising solution AdBoost, introduced along with page optimisation, contributed to revenue growth by improving targeting accuracy.

Kakao trims fat, profit jumps; Tokbiz strong as subsidiaries slow

Kakao is expected to show clear improvement in profit, although revenue growth was not large. This is interpreted as the result of continued high-intensity restructuring since CEO Shina Chung took office. Kakao cut the number of affiliates sharply to about 94 from 147 by shedding non-core businesses. Cost-efficiency measures, including winding down non-core operations such as Kakao Hairshop and spinning off the content CIC that runs the Daum portal, were a major factor behind the surge in operating profit.

Its core Tokbiz business benefited from the effects of changes to KakaoTalk. Revenue growth was driven as advertising inventory expanded through first- and third-tab revamps carried out in the second half of last year. The securities industry says Bizboard and message ads posted solid growth alongside seasonal effects. Structural cost cuts strengthened the floor for performance, while the platform revamp helped defend against a decline in revenue.

Weakness in the content segment is cited as a disappointing point. With no new titles, revenue in the games segment is expected to fall more than 20 percent from a year earlier, and slowing performance at subsidiaries is seen as having limited overall top-line growth. The industry also says Tokbiz supported the downside for results, but without a recovery in content, there are limits to mid- to long-term top-line growth.

The 2026 battleground is 'AI agents'; timing of monetisation uncertain

The two companies will move to pre-empt the AI agent market starting in 2026. Naver plans to launch Agent N, integrating search and shopping, while Kakao is set to unveil its conversational assistant Kanana, both during the first quarter.

Naver is aiming for 'purpose-driven AI' that identifies users' purchase intent and links it through to execution, through a shopping agent and a new AI tab within integrated search. Kakao, by contrast, is betting on 'relationship-driven AI' that understands the context of conversation and supports reservations and payments, based on the powerful platform of KakaoTalk.

The securities industry is raising caution alongside expectations that AI services will become a new growth engine. Jieun Lee, an analyst at Daishin Securities, said valuation re-rating is expected as AI-based Tokbiz growth accelerates in 2026. Some analysts also say the effect of AI adoption on increasing time spent is still minimal and that it will take time before meaningful monetisation.