Naver Q3 net dips 19.5 pct on spin-off

Naver Corp., South Korea's top Internet portal operator, said Thursday its third-quarter profit dropped 19.5 percent from a year earlier on a spin-off of its online gaming business and a one-off factor.

Net profit reached 76.2 billion won (US$71.9 million) on a consolidated basis in the July-September period, compared with 94.7 billion won the previous year, Naver, formerly known as NHN, said in a regulatory filing.

However, revenue jumped 42 percent on-year to reach 585 billion won in the third quarter, while operating profit dropped 12 percent to 105 billion won over the cited period.

Naver spun off its on-line gaming business in August this year in a bid to focus on its mainstay business. The on-line game affiliate, NHN Entertainment, has roughly 1 trillion won in assets.

Revenue from its search advertisements reached 333 billion won in the third quarter, up 13.1 percent from a year earlier.

Sales from display ads, however, fell 15.5 percent on-year to reach 74 billion won due to seasonal factors.

The company also said revenue from its flagship messenger service LINE shored up its third-quarter sales, with revenue from the services standing at 176 billion won in the third quarter, which is a huge jump from 11.2 billion won a year earlier.

The free mobile messenger application broke the 200 million download mark worldwide in July only four months after the service drew 150 million global users in April and seven months after attracting 100 million in January this year.

Given the pace of growth, analysts expect that it won't be long before LINE sets another milestone of 300 million users, possibly by the end of 2014.

The free messenger service was launched in Japan in June 2011.

The service has reached 231 countries and is offered in 16 languages. According to Naver, Japan had the largest market with 47 million users, followed by Thailand with 18 million, Taiwan with 17 million, Spain with 15 million and Indonesia with 14 million. (Yonhap News)