Naver, the South Korean internet powerhouse, has clinched a significant contract valued at 2 trillion won ($1.5 billion) with an undisclosed US company for AI computing services. This deal involves Naver's AI Factory project, which is set to commence operations in the first half of 2027 with an initial capacity of 55 megawatts, eventually expanding to 200 megawatts by 2028. Revenue from this venture is anticipated to start flowing once operations begin.
During an earnings call, CEO Choi Soo-yeon highlighted the strategic importance of this contract, noting that it positions Naver advantageously amid a shortage of liquid-cooled data centers capable of supporting Nvidia's advanced Vera Rubin chips. This scarcity could bolster Naver's competitive edge in the AI infrastructure market.
In addition to its AI endeavors, Naver is set to establish a logistics subsidiary, aiming to enhance its fulfillment services. The company plans to invest nearly 1 trillion won through 2030 to expand leased fulfillment centers, optimizing inventory placement and demand forecasting through shopping data analytics. However, Naver intends to mitigate the financial impact on its cash flow and earnings through strategic financing arrangements.
Naver's third-quarter financial results reflected both growth and challenges. The company reported a record quarterly revenue of 3.47 trillion won, a 10.7 percent increase from the previous year. However, operating profit declined by 20.9 percent to 451.3 billion won, attributed to rising costs associated with AI infrastructure, content, and offline data investments.
Chief Financial Officer Kim Hee-cheol disclosed that Naver is in discussions with over 10 potential customers outside Asia, including major AI model developers, for the remaining 180 megawatts of capacity. This expansion is part of Naver's strategy to broaden its AI infrastructure business globally.
Looking ahead, Naver plans to launch a personal AI agent app by the end of the year. This app will integrate various services such as search, shopping, local services, reservations, and payments, aiming to streamline tasks for users. Choi noted a significant increase in traffic and transaction value from AI Tab to shopping and local services since its launch.
Furthermore, Naver is set to introduce robotic delivery services in Riyadh, Saudi Arabia, by the first half of 2027. This initiative will leverage Naver's digital-twin mapping technology and Naver Labs' Nuri robot to enhance delivery efficiency in residential complexes.
In the third quarter, Naver's platform revenue rose by 7.3 percent to 1.95 trillion won, while financial platform revenue saw a 14.1 percent increase to 487.7 billion won. Global ventures revenue also climbed by 15.9 percent to 1.04 trillion won, driven by overseas commerce and Saudi digital-twin projects.
