Naver第一季度：强劲的电商业务，更多GPU投入；因短期利润率拖累，目标价下调至290,000韩元

+8522123 2644minjoo.kang@bernsteinsg.com +85221232659robin.zhu@bernsteinsg.com +85221232618charles.gou@bernsteinsg.com ?035420.KS Naver Q1: Strong Commerce, heavier GPUs; PT cut to 290K onnear-term margin drag hours on April 30,with revenueof KRW3.2trn (+16%YoY)and operatingprofitof KRW542bn (+7% YoY), broadly in-line at the top line but below expectations at the OP level.Digitaladrevenue came in slightly weaker than expected, but strong commerce revenueoffset the shortfall, bringing overall revenue in-line with our and market's expectations.Operating profitmissed ourandmarketconsensusby12%and5%,respectively,duetohigher infrastructure costs ofKRW251bn (+32.5%YoY),driven byelevated depreciationfrom increased computing asset investments, including GPUs.We expectthis infrastructure Commerceexecution remainsthecoregrowthengine.Commercecontinuestodotheheavylifting.SmartstoreGMVgrew14%YoY,whileCommerceservicerevenueacceleratedapp.App-led commerce is becoming central to Naver's ecosystem: Plus Store GMV rose28% QoQ, time spent has more than doubled since launch (March 2025), and returningusers increased23%QoQ.Withconversionratesaround84%higherthanthecommerceweb,the Plus Store is rapidly evolving into a self-reinforcing transaction hub ratherthan asupplementary channel. Logistics strengthens the commerce flywheel. Early traction in logistics is supportingGMV growth roughly 4ppt higher than peers, while shipping upgrades tied to membershiphave lifted order frequency by more than 25%.Management remains focused on multi-yearfast-deliveryGMVtargets (50%of SKU coverage till 2028),while selectively exploring moredirect - but still asset-light - logistics investments to support scalability without structurallyinflating capital intensity. InvestmentImplications WeretainOutperformratingonNaverbut lowerourPTtoKRW290k (fromKRW300k)after revising our 2026-27EPS estimates down by 12-14% to reflect higher-than-expected Al Briefing continues to scale, driving a 2.5x YoY increase in long-tail queries and more than 2.5x higher follow-up CTR thanfurther anchors search directlyto transactions, while pilots of GenAl-powered shopping and local ads in Q2, with a broaderrollout in2H,positionAl as a direct conversion andmonetizationlever.Naver's closed-loop structure across search,commerce,and payments,backed byfirst-partytransaction data,underpins this shiftfrom Al"answers"to Al"action" Coupang's logistics moat while delivering structurally faster GMV growth.Shipping expansion, membership-driven incentives,and the Plus Store app are lifting conversion and repeatusage,allowing Navertotake share withoutadopting Coupang'scapital-intensive 1P model. Combined with its long-tail 3P advantage in high-growth item categories (such as fashion, beauty,transactions (Naver continues to substantially outperform Coupang on growth.In March, Coupang's GMV grew just 5% Yoyversus Naver's 22% YoY), reinforcing commerce as the core driver of a multi-year rerating. to28.8% inQ1ashigherGPUcapex flowed throughtoelevated depreciation andtelecomcosts,withadditionaldrag fromcontent/IP spending (Winter Olympics and LCK rights; KRW 18bn).While this creates near-term margin pressure and limitedvisibility on GPU scale and utilization tempers confidence on the pace of profit growth,we hope the investment is strategic.Withcommerce asNaver'sfastest-growing segment andKRW8tn (USD5.5bn)ofcash on hand as ofQ1,the company retains ample We'veupdated our estimates for Naverto reflect Q1 reporting.Our estimates for operating profit are slightly lowerversusprior levels.Exhibit 3 shows a summaryof our estimate changes.Our latestsummarised projections for the company are shown atthe back of this note. EXHIBIT4:Naverreports revenueacrossthreesegments:EXHIBIT5:NaverpostedQ1revenueof KRW3.2trn(+16% YoY),with commerce strengthoffsetting softerdigitalad revenue. NaverPlatform,FinancialPlatform,andGlobalOpportunities,whichincludeC2C,content,andenterprise. EXHIBIT6:Naver'soperatingprofit came inbelowexpectations due to higher infrastructure costs. Source: Corporate reports, Bernstein analysis. C2C commerce,Webtoon,and cloud-narrowed in Q1. by higher capex as infrastructure investments drove updepreciation,telecom costs, and content spending. Source: Corporate reports, Bernstein estimates and analysis EXHIBIT12:Naver:CashFlowStatement O - Outperform, M - Market-Perform, U - Underperform, NR -Not Rated, CS - Coverage Suspended Source: Bloomberg, Bernstein estimates and analysis. References to"Bernstein" or the "Firm" in these disclosures relate to the following entities: Bernstein Institutional Services LLC (April 1, 2024 onwards), Sanford C. Bernstein & Co., LLC (pre April 1, 2024), Bernstein Autonomous LLP, BSG France S.A. (April 1,2024onwards),SanfordC.Bernstein(HongKong)Limited盛博香港有限公司，SanfordC.Bernstein(Canada)Limited,SanfordC. Bernstein (India) Private Limited (SEBI registration no. INH000006378), Sanford C. Bernstein (Singapore) Private Limited,Africa Tech