Kakao Corp. reported third-quarter operating profit of 240.3 billion won ($163 million) on Thursday, short of analysts' forecasts, and set a target of more than 6 trillion won in annual revenue by 2030 for the artificial intelligence company it plans to carve out of the KakaoTalk operator.

The South Korean internet group's numbers matter beyond Seoul because Kakao is the clearest listed test of whether a messaging app with about 50 million domestic users can turn AI assistants into paying businesses. Its plan to split into two listed companies, one built around KakaoTalk and AI and one holding its financial and content affiliates, gives investors a choice between them for the first time.

Kakao Q3 results: platform up, content down

Operating profit for the July to September quarter missed the FnGuide consensus of 248.3 billion won, Korea JoongAng Daily reported. Revenue came in at about 2.09 trillion won, above the roughly 2 trillion won analysts had expected.

Year-on-year comparisons depend on the basis. Against the 208 billion won of operating profit and about 2.09 trillion won of revenue Kakao reported for the third quarter of 2025, profit rose roughly 15% and sales were flat. On a recast basis that excludes gaming and healthcare affiliates, operating profit rose 7% and revenue 6%, according to NEWSTOP. Operating profit fell 13% from the second quarter, when Kakao posted a quarterly record of 277 billion won. The operating margin was 11.5%.

The platform segment did the heavy lifting. Its revenue rose 17% to 1.235 trillion won, lifting its share of group sales to 59.2% from 54%. Talk Biz, the advertising and commerce business inside KakaoTalk, grew 13% to 632.9 billion won, with display advertising in the app up 35%. Commerce revenue rose 16% to 241.3 billion won on gross merchandise value of 2.3 trillion won. Mobility and payments revenue climbed 21% to 602.1 billion won.

Content went the other way. Revenue fell 6% to 851.7 billion won, with music down 10% and the story business down 17%. Net profit fell 8% to 178 billion won, though net income attributable to controlling shareholders rose 27% to 159 billion won, NEWSTOP reported.

Kakao's banking arm had a stronger quarter. KakaoBank's operating profit rose 26.9% to 191.8 billion won, and Kakao Pay's more than doubled to 32.46 billion won, according to JoongAng Daily. Capital Times covered KakaoBank's figures when it reported a profit beat earlier this week.

KakaoAI and KakaoX: targets and payouts

The split, which Kakao's board approved on Aug. 21, would create KakaoAI, covering KakaoTalk, AI, advertising and commerce, and KakaoX, which would keep stakes in affiliates including KakaoBank, Kakao Pay, Kakao Entertainment and Kakao Mobility. Chief Executive Chung Shin-a would lead KakaoAI, and Kakao Investment CEO Kim Do-young would head KakaoX, JoongAng Daily reported.

On Thursday the company put numbers on both. KakaoAI is aiming for more than 6 trillion won in revenue by 2030, against annualized Talk Biz revenue of about 2.5 trillion won now. KakaoX is targeting 10 trillion won.

The shareholder return plans differ. KakaoX would pay out 30% of after-tax dividends it receives from subsidiaries, plus leftover investment gains, and would buy back and cancel 300 billion won of shares funded by selling its stake in Dunamu. KakaoAI would return 20% to 35% of standalone adjusted free cash flow, rising to 40% in any year free cash flow grows at least 50%.

Combined revenue of the mobility, payments and content units that mostly sit on the KakaoX side grew only 4% in the quarter, to 1.454 trillion won, NEWSTOP noted, a gap that supports the company's case for separating the faster-growing KakaoTalk business. The plan still faces opposition from Kakao's labor union and some shareholders, according to the same report.

Kanana Space and the AI revenue model

The near-term product test is Kanana Space, an assistant inside KakaoTalk that reads chats, manages schedules, searches the web and makes purchases. It enters a closed beta in December, with a broader rollout next year. It builds on Kakao's partnership with OpenAI, which put ChatGPT inside KakaoTalk last year, but runs on Kakao's own Kanana models: smaller on-device models for simple tasks and cloud models for harder ones, JoongAng Daily reported.

Kakao is targeting 10 million monthly active AI users on KakaoTalk this year. Management described four ways to earn money from them: consumer AI subscriptions, better-performing ads, fees on purchases made by AI agents, and commissions on bookings and purchases with partners.

"People use KakaoTalk to make plans and coordinate schedules with family, friends and colleagues," Chung said on the earnings call.

Reports differ on the date of the shareholder vote on the split. JoongAng Daily put the extraordinary general meeting on Jan. 15, 2027, with the split and KakaoAI's relisting on Feb. 1, while NEWSTOP cited Dec. 17. Either way, the first numbers on Kanana Space usage will arrive before shareholders decide.