Naver to invest $330 mn in content business expansion

Naver Corp., South Korea’s online portal giant, decided to make an additional investment in a web content unit to expand its global webtoon and web novel business.

Naver plans to contribute 397.5 billion won ($330 million) to Webtoon Entertainment Inc., its subsidiary in the US, according to a filing to a financial regulator on Thursday. Naver’s webtoon and web novel affiliates such as Naver Webtoon Corp. in South Korea and Line Digital Frontier Corp. in Japan are Webtoon Entertainment’s subsidiaries.

“This contribution is to expand Naver’s global business and continue investment,” said a Naver official.

Naver unveiled the direction of content business expansion.

The portal giant will speed up moves to make profits from Wattpad Corp., eBook Initiative Japan and Munpia Inc. acquired last year. It will also enhance cooperation with Marvel, HYBE Co. and other global content partners with intellectual property.

“We will introduce various new profit models for webtoons this year,” said Naver Chief Executive Han Seong-sook. “We will also focus on expanding global storytelling platforms including advertising and IP businesses.”

RAPID GROWTH

Naver generated 233.3 billion won of sales from content business including webtoons and web novels in the fourth quarter, up 67.9% from a year earlier.

“Naver webtoons are rapidly growing with global annual transactions topping 1 trillion won in the fourth quarter,” Han said. “The box office hit of Our Beloved Summer, a drama jointly produced with StudioN, became a success story of turning webtoons into video products, showing strong potential for Naver IP business’s expansion.”

Meanwhile, Naver reported record earnings last year on strong growth in its key businesses. Operating profit rose 9.1% to 1.3 trillion won in 2021 as sales surged 28.5% to 6.8 trillion won.



Its search platform business reported 3.4 trillion won in sales, up 17.4%, while revenues from commerce and content units jumped 35.4% and 50.6% to 1.5 trillion won and 692.9 billion won, respectively.

“Advertising-related sales accounted for 60% of total sales of 6.8 trillion won in 2021,” said Naver Chief Financial Officer Park Sang-jin. “The advertising revenue had made up most of the total sales, but the proportion of revenues from new businesses such as fintech, content and cloud is growing.”

Write to Min-Ki Koo at kook@hankyung.com
Jongwoo Cheon edited this article.