Better 2Q performance for online portals: analysts

The country’s top internet portals are expected to make comebacks in the second quarter of this year, despite lackluster earnings in the first quarter, analysts said.

Last week, the No.1 online portal NHN posted 576.7 billion won ($503 million) in sales and 161.8 billion won in operating profit from January to March.

The firm’s sales figure surged 14.2 percent from the same period a year ago, but slipped 3.7 percent in operating profit.

However, NHN, better known for its search engine Naver, was not the only portal experiencing financial troubles in the first three months as Daum and SK Communications both reported that they recorded losses in the same quarter.

Daum on Friday posted sales of 110.2 billion won in the first quarter of 2012, up 13.3 percent from a year earlier, and 27.1 billion won in operating profit, down 11.3 percent. SK Communications, which was hit hard by a private user information leak last year, recorded an operating loss of 9.5 billion won.

“For NHN, the operating profit figure is projected to see two-digit growth in the second quarter compared to the same period last year,” said Choi Chan-seok, an analyst at KTB Securities. “The most important points to watch are the future growth of the mobile search advertisement sales and the development of Naver Japan.”

Kang Rok-hee, an analyst at Daishin Securities, also said that NHN is currently on the move to evolve into a platform service company with an emphasis on mobile.

“The number of downloads for its mobile messenger LINE has surpassed the 34 million mark with its user base spreading out to Japan, Taiwan, Thailand, the Middle East and Europe,” he said.

Daum has joined the efforts to increase its lineup of new projects including the full-scale launch of its mobile game platform called “Daum-Mobage.”

“We are expecting a rise in Daum’s stock prices in the upcoming quarter in part due to the company’s plan to unveil 20 more games at Daum-Mobage by the end of this year, and showcase 100 by 2013,” said Choi of KTB Securities.

By Cho Ji-hyun (sharon@heraldcorp.com)