Naver and Kakao are charting sharply divergent paths in the artificial intelligence business. Naver is pursuing an “AI Factory” strategy, pouring tens of trillions of won into building AI infrastructure in partnership with global companies, while Kakao is concentrating on enhancing AI services built on its KakaoTalk platform rather than making massive infrastructure investments.
According to information and communications technology industry sources on the 9th, Naver is accelerating its AI data center infrastructure business based on strategic alliances with Nvidia and global alternative investment firm Brookfield. Kakao, meanwhile, plans to expand its “intention economy” ecosystem by integrating AI into its core asset, KakaoTalk, strengthening business-to-consumer (B2C) services that connect user intent to actual transactions.
Naver’s AI Factory vision is expected to produce tangible results starting in the first half of next year. The company plans to begin operating a 55-megawatt AI data center in the first half of 2027, scaling up to 100MW by the end of 2027 and 200MW in 2028, with a medium-to-long-term goal of building gigawatt-level infrastructure. To support this, Nvidia has committed to participating in a 1 billion USD (approximately 1.4 trillion won) capital increase by Naver as a strategic investor, while Brookfield has structured a special purpose vehicle of up to 9 billion USD (approximately 12.7 trillion won) to reduce the financial burden of the large-scale investment.
Naver CEO Choi Soo-yeon stated during the company’s second-quarter earnings conference call on the 7th, “Nvidia’s decision to participate in Naver’s capital increase at the 1 billion USD level signifies that the two companies have evolved into a long-term partnership where business performance and risk are shared.” She emphasized, “We will approach this market as a high-value-added business that combines GPU computing and cloud model operation services, going beyond simple computing rental.” Naver has set a target of raising the AI Factory’s operating profit margin to 20% over the long term. In addition to expanding domestic infrastructure, the company also plans to target overseas markets such as the Middle East and South America, where there is demand for “sovereign AI”—building AI systems based on local data and regulations.
Naver’s moves are backed by massive research and development investment. The company’s R&D spending reached 2.2218 trillion won last year, surpassing the 2 trillion won mark for the first time, with cumulative R&D expenditure over the past decade exceeding 15 trillion won (approximately $10.7 billion). In the first quarter of this year alone, Naver invested 602 billion won, representing 18.6% of revenue, into R&D. However, the expansion of AI infrastructure investment is weighing on short-term performance. Despite recording its highest-ever quarterly revenue of 3.3888 trillion won in the second quarter, Naver’s operating profit fell 0.2% year-on-year to 520.3 billion won (approximately $369.7 million), missing market expectations of 566.2 billion won. Naver’s stock closed down 7.08% at 210,000 won on the day of the earnings release.
An industry insider analyzed, “Since Naver’s services segment—comprising search (advertising), commerce (shopping), and other major businesses—accounts for about 56% of total revenue as the core profit engine, the company appears to be leveraging that foundation to secure future growth drivers. The key will be proving the strategy through results while enduring margin pressure relative to investment.”
Kakao has chosen the exact opposite path. The company decided not to enter the infrastructure race, judging that hardware equipment such as GPUs and AI servers undergoes rapid generational turnover and that long-term return on investment is highly uncertain relative to the large upfront capital required. Kakao CEO Chung Shin-a made the company’s position clear during the second-quarter earnings call on the 6th, stating, “Infrastructure such as AI data centers or GPU clouds carries uncertainty in long-term investment returns compared to the massive upfront investment required,” and affirming the company’s intent to concentrate capabilities on developing AI services that the entire nation can use in daily life.
The core of Kakao’s strategy is KakaoTalk. The company is focusing on agentic AI services where AI identifies user intent and executes actual transactions. A representative example is a system where, when an intent to order food is detected in a KakaoTalk chat room, the AI recommends menus based on user preferences and connects through to ordering and payment. To enable this, Kakao announced a gateway partnership with food delivery app Coupang Eats. The structure allows Coupang Eats to leverage KakaoTalk’s user base of approximately 50 million people, while KakaoTalk provides users with a complete experience without leaving the app. Kakao plans to expand such collaborations into lifestyle-adjacent areas including commerce, reservations, travel, and payments.
Kakao has also steadily increased its R&D investment. The company’s R&D spending grew approximately sixfold over a decade, from 211.6 billion won in 2016 to 1.2992 trillion won last year. In the first quarter of this year, Kakao invested 331.6 billion won, or 17.1% of revenue, into R&D. Through a collaboration with OpenAI, Kakao is offering ChatGPT access within KakaoTalk, and is also incorporating its self-developed AI “Kanana,” continuously expanding the AI service experience within the platform.
Another industry insider noted, “The success or failure of this strategy will hinge on how naturally users embrace AI services embedded in KakaoTalk, and whether they continue using them rather than treating them as a one-time novelty.”
The two companies’ combined R&D spending reached 933.6 billion won in the first quarter of this year, with total first-half R&D expenditure including the second quarter estimated at around 2 trillion won (approximately $1.4 billion). While both share the common ground of sustaining large-scale R&D investment to secure AI competitiveness, their specific business strategies and monetization paths are starkly divergent. Naver has placed its bet on AI infrastructure and the enterprise and public sector markets, while Kakao is wagering on AI services and user touchpoints.