Naver Founder and Chairman Lee Hae-jin, left, greets Nvidia CEO Jensen Huang during their meeting at Naver headquarters in Seongnam, south of Seoul, on June 8. Photo courtesy of Naver
Aug. 7 (Asia Today) — South Korean technology company Naver is using artificial intelligence (AI) to accelerate growth in its core advertising and commerce businesses while developing large-scale AI infrastructure as a new source of revenue.
Naver said Friday that second-quarter consolidated revenue rose 16.2% from a year earlier to 3.39 trillion won ($2.32 billion), driven by growth in advertising, commerce and its global consumer-to-consumer businesses.
Operating profit edged down 0.2% to 520.3 billion won ($356.6 million) as increased spending on AI infrastructure offset stronger revenue growth.
AI has become both a major investment expense and an increasingly important tool for generating revenue across Naver’s existing businesses.
Platform revenue rose 12.3% from a year earlier to 1.90 trillion won ($1.30 billion), while advertising revenue increased 7.5%.
Naver said AI-driven optimization of advertising placements and improved targeting accounted for more than 60% of advertising revenue growth.
AI Briefing ads, formally launched in late July, generated click-through conversion rates more than 30% higher than conventional search advertising, while purchase conversion rates were more than three times higher, according to the company.
Naver is also seeing increased engagement with what it describes as “agentic AI,” systems designed not only to provide information but also to help users complete tasks.
Its AI Tab, officially launched June 25, had surpassed 10 million monthly active users by early August. The weekly return rate was more than twice the level recorded during initial testing.
In shopping and local services, more than 40% of users who clicked through from the service went on to make purchases or reservations, the company said.
Naver plans to introduce additional AI agents, including a real estate listing search agent in the third quarter and a health-related agent later this year. The company said it will increasingly measure performance by how often AI services lead to actual transactions.
Commerce also continued to expand.
Service revenue rose 31.3% from a year earlier, supported by Naver Plus Store, membership services and its N Delivery logistics service. Transaction volume through Smart Store increased 15.5%.
Naver plans to further expand N Delivery during the second half of the year while investing in data-driven logistics systems and infrastructure to strengthen both delivery services and AI-based commerce.
Naver Pay is also being developed as part of the company’s broader AI ecosystem.
Second-quarter payment volume through Npay rose 21% from a year earlier to 25.2 trillion won ($17.27 billion).
Naver plans to expand its Npay Connect integrated payment terminals to collect more online and offline transaction data that can be used by AI agents, advertising systems and merchant services.
During its earnings call, the company said it aims to increase annual offline payment volume to 130 trillion won ($91 billion) within five years.
Revenue from Naver’s global ventures rose 24.4% to 1.02 trillion won ($696.2 million).
Consumer-to-consumer revenue jumped 74.9%, supported by growth at Wallapop, Poshmark and Soda. Content revenue increased 0.5% and enterprise revenue rose 21.3%.
Naver has identified AI infrastructure as its next major growth engine.
Chief Executive Officer Choi Soo-yeon said during the earnings call that the company’s global AI Factory project with Nvidia is scheduled to begin with 55 megawatts of capacity in the first half of 2027 and expand to 200MW in 2028.
Naver ultimately intends to expand the infrastructure to the gigawatt scale.
The company expects global demand for AI computing capacity to continue rising while constraints involving electricity supply, semiconductors and data center construction limit available capacity.
Naver plans to create a wholly owned operating company to manage the AI Factory business.
Under the proposed financing structure, Nvidia plans to invest about $1 billion directly in Naver, while Brookfield has entered into a nonbinding agreement to provide up to $9 billion in financing for computing infrastructure, including GPUs and data centers.
The Brookfield financing is expected to be structured through special-purpose entities that will own infrastructure assets.
The arrangement is intended to reduce Naver’s upfront capital burden while allowing the company to focus on operating AI factories and providing full-stack computing services.
Nvidia has said the initial AI Factory at Naver’s GAK Sejong data center will expand from 55MW to 200MW by 2028, with Naver ultimately targeting 1GW of AI infrastructure.
Naver also expects the business to become increasingly profitable as it scales.
Chief Financial Officer Kim Hee-cheol said operating margins at the AI Factory business could be relatively low at first but are expected to reach double digits as the business matures and potentially exceed 20% over time.
The company identified fluctuations in semiconductor prices, customer demand, financing costs and technological changes as key risks.
Naver said it plans to mitigate those risks through its strategic partnership with Nvidia and customer contracts with varying durations.
The AI Factory business could begin contributing to Naver’s financial results as early as next year.
The company expects related revenue to begin in the first half of 2027 and plans to secure initial customers through Nvidia’s ecosystem as well as Naver’s existing corporate and public-sector customer base.
Naver intends to move beyond basic GPU rental by combining computing capacity, cloud services and AI model operations into higher-value services.
“Our strategic partnership with Nvidia has provided a foundation for rapidly expanding the AI Factory business while minimizing our initial capital burden,” Choi said.
She said Naver plans to use its global customers, Nvidia’s ecosystem and its own corporate and public-sector customer base to secure early demand and turn the AI Factory business into a new growth engine in the global AI computing market.
— Reported by Asia Today; translated by UPI
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Original Korean report: https://www.asiatoday.co.kr/kn/view.php?key=20260807010002430
