NHN Announces Second Quarter 2008 Financial Results. 2008-08-07 NHN Announces Second Quarter 2008 Financial Results. - 2Q Revenue reached a record High KRW 304.8 billion and operating Income KRW 128.7 billion - Up 44.5 % in revenue and 45.6 % in operating income year over year - Targets have been re-adjusted because of the economic slow down SEONGNAM, South Korea, August. 7, 2008 – NHN corporation., Korea’s leading Internet Company announced that the company recorded a KRW (Korean Won) 304.8 billion in revenue, KRW 128.7 billion in operating income and KRW 92.9 billion of net income for the second quarter 2008. This is the first time that the company’s quarterly revenue exceeded KRW 300 billion. NHN saw an increase of 3.2 % in revenue and 1.0 % in operating income from the previous quarter. The year over year growth rates for the revenue is 44.5% and 45.6% for the operation profit. The revenue breakdown for the second quarter is as follows: search sales accounted for 50% of revenues; games sales 30%; display(banner) ads sales 12%; e-commerce revenues 7%; and others sources 1%. Despite a slow economy and a decreased number of business days, NHN was able to improve customer satisfaction on search engines through the vertical search and strengthen DB. As a result, the search sales reached a KRW 151.7 billion in revenue, up 1.9% from the previous quarter and 31.1 % for year over year. By maintaining a stable traffic and with an increased number of paid users, the game sales reached KRW 93.4 billion, up 3.3 % from the previous quarter and up 86.8 % over the same period one year ago. The display ads sales remain the same as the previous quarter, but it grew 24.3% year over year reaching KRW 35.6 billion. As for the e-commerce, the revenue grew 21.3 % quarterly and 62.2 % yearly to KRW 22.0 billion backed by increased revenue from other added ads. NHN was able to continue a record-high revenue for the second quarter although the second quarter is a non-peak season. However, with external factors such as a slowing-down economy the company adjusted its goal of reaching total revenues of the year from KRW 1,270 billion to KRW 1,240 billion and an operating profit margin from 42 % to 41 %. “The quarterly revenue exceeded KRW 300 billion for the first time despite the offseason. The revenue grew largely by a stable growth of online ads, the e-commerce area and successful games. NHN will focus on improving information platform by introducing new services such as OpenCast. NHN will continue its effort to be not only the top company in Korea, but also a truly global internet company by exploring overseas markets with our outstanding technicality and know-how.” Said Chae Hwi-young, CEO of NHN. NHN Japan recorded JPY 2.7 billion in revenue which is down 4.8 % from the previous quarter because of the offseason. However, the revenue increased 29.3 % compared to the same period last year. The operating profit decreased 61.4 % quarterly and 44.4 % year over year to JYP 130 million because of an increase in related fees from publishing more games. For Ourgame, NHN’s Chinese joint venture, the revenue reached 56.27 million RMB, up 7.7 % from the previous quarter and 9.8% year over year due to increased revenue in publishing sector after a commercialization of R2 and others. However, the operating income decreased 4.9 % from the previous quarter reaching 2.36 million RMB. NHN USA saw a number of subscribers exceed 6.2 million thanks to successful games such as Special Force, GunBound and Drift City. By improving the billing infrastructure, NHN USA is experiencing a sound growth both in quality and in quantity.