Samsung Securities cut its target price for Kakao to 44,000 won (US$29) from 60,000 won (US$40), saying weak AI execution, slowing core businesses. The brokerage also said labor unrest clouded the company’s outlook.

The brokerage still expected Kakao’s second-quarter operating profit to rise 18% year on year to 231.1 billion won (US$155 million) on revenue of 2.5 trillion won (US$1.66 billion).

It said the profit outlook was supported by restructuring and cost controls. Investors saw recent earnings gains as driven mainly by cost cuts rather than stronger underlying businesses.

Kakao has partnered with OpenAI and launched ChatGPT for Kakao. Analysts said its AI agent strategy has yet to show clear monetization or meaningful differentiation.

The company has reduced its affiliates from more than 140 to about 90 over the past two years.

Kakao’s labor union plans another protest on July 21.

Founder Kim Beom-su is facing an appeal trial over alleged stock price manipulation tied to Kakao’s 2023 acquisition of SM Entertainment after a lower court acquitted him.

🔗 Source: The Korea Times

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