What’s behind stagnant Naver’s stock?

The company logo of Naver is seen on the lobby of its headquarters in Seongnam, Gyeonggi Province, May 13. Yonhap

Naver is extending its sluggish run on the benchmark KOSPI, as it is caught in the middle of a fast-changing landscape concerning social media, search engines, artificial intelligence, e-commerce and other sectors where it excelled in Korea.

Naver closed at 166,800 won ($120.74) Tuesday, gaining 0.42 percent from the previous day’s close and staying far lower from the 200,000 won range where the internet giant started at the beginning of the year.

In particular, the share price Tuesday was sharply down from its all-time high of 465,000 won ($347) set in July 2021.

Accordingly, Naver is ranked 11th by market capitalization among KOSPI-listed firms after being the third-largest company.

The sluggish run comes as Instagram overtook Naver as the third most popular mobile app in Korea after YouTube and Kakao in terms of usage time in May.

The finding came from data from the mobile market research firm Wiseapp Retail Goods. This marked the first time that Instagram overtook Naver to claim the third spot since Wiseapp began compiling such data in 2016.

“The finding possibly signals challenge faced by Naver in the cross-border social media industry, considering Naver’s service is heavily concentrated on domestic users,” an analyst said on condition of anonymity.

Concerning search engines, Naver remains the most dominant player in the domestic market with a 60 percent market share.

The rate, however, has been shrinking, with Google catching up fast and narrowing the gap in market share to 20 percent, down from 40 percent.

In e-commerce, AliExpress and Temu from China have been muscling in fast into the Korean market by offering a range of low-cost goods that Naver can’t afford as a rival.

Uncertainties on Naver’s global business are also looming, as its partnership with SoftBank is falling apart regarding the Line saga, Japan’s top instant messaging app.

Line Yahoo (LY), the operator behind Line said last week it is phasing out its services linked with Naver due to 카지노 the Japanese government’s call for the Tokyo-based unit to reduce capital ties with the Korean company.

LY is 64.5 percent owned by A Holdings, a 50:50 joint venture between Naver and SoftBank.

At Tuesday’s general shareholders’ meeting, LY removed its chief product officer Shin Jung-ho from the board. The Korean developer of the messaging app, known as the “father” of Line, had de facto represented Naver on the board as the only Korean member.

LY CEO Takeshi Idezawa said at the shareholders’ meeting that the company plans to accelerate complete system separation with Naver, which was previously planned for 2026.

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