Kakao Corp., the operator of South Korea's top mobile messenger, on Thursday said its second-quarter net profit dropped due to increased costs and investments.
Its net profit reached 56.3 billion won (US$43.3 million) in the April-June period, down 44 percent from a year earlier, the company said in a regulatory filing.
Its operating profit declined 33.7 percent from a year ago to 113.5 billion won, while sales rose 12.1 percent to 2.04 trillion won over the cited period.
The earnings were behind market expectations. The average estimate of net profit by analysts stood at 93.8 billion won, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
Kakao's content business, which includes its games, digital comics and music, took up 52 percent of the second-quarter sales, while the rest came from its platform business.
The content business reported 18 percent on-year growth in sales at 1.05 trillion won for the April-June period. The platform business reported 988.7 billion won in sales, up 6 percent from a year ago.
Its "story" business, which refers to entertainment content, posted a 1 percent on-year growth to 231 billion won, while sales of its games declined 20 percent to 268.6 billion won.
The number of monthly active users of KakaoTalk, its flagship mobile messenger, came to 48.2 million as of the end of the second quarter, up 703,000 from a year ago.
Kakao said it will continue investing in infrastructure to provide stable service, as well as in future growth engines like artificial intelligence and health care services.
Kakao's earnings report was released before the market opened.
Source: Yonhap News Agency