Naver said Thursday that first-quarter operating profit rose 7.2 percent year-on-year to 541.8 billion won ($364.7 million), with the company pointing to artificial intelligence integration across its advertising and commerce businesses as the main driver of revenue acceleration.

Consolidated revenue climbed 16.3 percent to 3.24 trillion won, beating the analyst consensus of 3.14 trillion won. Operating profit fell slightly short of the 559.3 billion won forecast.

Advertising revenue grew 9.3 percent, with AI accounting for more than half of that growth through targeting improvements via Naver's ADVoost system. Commerce-driven service revenue surged 35.6 percent, lifted by the Naver Plus Store app, the company's membership program and its N-delivery service.

CEO Choi Soo-yeon said gross merchandise volume on the Naver Plus Store app rose 28 percent quarter-on-quarter, with conversion rates running 84 percent higher than on the web, and that more than 80 percent of app buyers are now Naver Plus members.

A customer data breach last year at rival Coupang also pushed some shoppers back to Naver, alongside a seller-fee restructuring implemented in June.

Naver Pay's transaction volume reached 24.2 trillion won, up 23.4 percent, with payments on external merchant sites making up 56 percent of the total.

Revenue from the company's newly grouped Global Initiatives segment, which houses its consumer-to-consumer marketplaces, rose 18.4 percent, with C2C sales jumping 57.7 percent after the consolidation of Spanish marketplace Wallapop and continued growth at Poshmark and Kream.

The earnings come three days after Naver opened a public beta of AI Tab, its agentic search product, to Naver Plus members. Choi told analysts the company would begin testing generative AI advertising tied to shopping and local search in the second quarter, with full monetization slated for the third.

"Naver is the only platform that holds search, commerce and payment infrastructure in a single flow, which is the core competitiveness of the AI agent era," she said, adding that the company aims to establish AI search as a meaningful new revenue source by year-end.

CFO Kim Hee-cheol said GPU usage came in roughly 30 percent below internal projections, partially offsetting infrastructure cost pressures that have weighed on margins. He added that AI infrastructure spending would rise this year as the company continues building out capacity.

By Moon Joon-hyun (mjh@heraldcorp.com)