Q2 2026 Kakao Corp Earnings Call Transcript
Key Points
- Record quarterly revenue and operating profit, with consolidated revenue up 9% YoY and operating profit up 36% YoY, driven by strong platform business growth.
- Talk Biz advertising and subscription revenue hit a quarterly record high of KRW 400 billion, with Talk DA growing 28% YoY and business message revenue up 20% YoY.
- Strategic A2A partnership with Coupang Eats to integrate food delivery into KakaoTalk's agentic AI, enabling end-to-end ordering and payment within chat, positioning Kakao as a first mover in the intention economy.
- Kanana-2-1.3B on-device AI model outperforms global open-source models in key areas and is open-sourced, while user retention for Kanana in KakaoTalk improved to ~80% from ~70% post-launch.
- ChatGPT for Kakao reached 13 million cumulative subscribers with strong engagement (6+ daily outbound messages per user, ~8 minutes daily time spent), and the company targets 10 million MAU for AI services in KakaoTalk by year-end.
- Platform business re-entered structural growth phase, with CFO expecting to outperform 2026 targets of >10% top-line growth and 10% OP margin, supported by cost discipline and non-core streamlining.
- Network ads revenue declined 45% YoY due to lower traffic on certain platforms and changes in advertising strategy, with recovery only expected from next year.
- Piccoma's revenue in yen declined 9% YoY amid a slowdown in Japan's manga market, and overall story revenue fell 16% YoY.
- AI monetization is still in investment phase, with meaningful revenue contribution not expected until 2025, and AI-related OpEx will remain at current levels in H2.
- Commerce revenue declined 10% QoQ due to the high base from Lunar New Year demand, and total commerce GMV fell 5% QoQ.
- Consolidated net income was impacted by one-off losses from discontinued operations and income tax expenses, creating a gap between operating profit and net income.
- CapEx increased significantly (KRW 188 billion in Q2, up KRW 89 billion YoY) due to server purchases, and the company has decided not to pursue AI infrastructure business, potentially missing out on high-growth opportunities.
Hello, I'm Jeffrey from Kakao's IR. We will now begin Kakao's 2026 second quarter earnings conference call. Today I am joined by Shina Chung, the CEO, and Jayden Shin, the CFO. Please be reminded that the earnings results are consolidated estimates under the K-IFRS basis and are subject to change upon the auditor's review. Forward-looking estimates are based on assumptions, so actual results may differ from figures included in today's presentation. Now, we will have a presentation from the CEO, Shina Chung.
Good morning. This is Shina, CEO of Kakao. In the internet and mobile eras, the attention economy focused on capturing users' attention primarily through advertising was a key theme. In the coming era of agentic AI, however, we expect a full-scale shift towards intention economy, where a new value is created in the process of understanding users' intents and completing actions.
Amid this major transition, Kakao's aims to make the agentic AI user
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