Kakao Corp Announces Major Spin Off, Creating KakaoAI to Focus on Chat App-Based Platform and AI
2 Sources
[1]
Kakao to spin off chat app-based platform business into KakaoAI, relist in 2027
SEOUL, Aug 21 (Reuters) - South Korea's dominant chat app operator Kakao Corp (035720.KS), opens new tab said on Friday it plans to spin off its chat app-based platform business into a new company, tentatively named KakaoAI, while retaining investment operations in a firm renamed KakaoX. With this move, the company is seeking to address â a conglomerate discount and strengthen business specialisation, Kakao said in a regulatory filing. The company expects the new entity to relist on the Korea Exchange on January 27, 2027, following a planned January 1 split. KakaoAI will focus on AI, advertising, commerce and the KakaoTalk chat app platform, while KakaoX will manage and develop holdings â in areas including fintech, content and mobility, Kakao said. Kakao set 2030 targets of 6 trillion won ($4.34 billion) or more in revenue and an operating margin above 30% for â KakaoAI, while setting a target of 10 trillion won or more in revenue for KakaoX for the same year. Kakao â had reported consolidated revenue of 8.1 trillion won in 2025, according to the company. Kakao also pledged â 300 billion won of share buybacks and cancellations over three years after the split. ($1 = 1,381.2700 won) Reporting by Kyu-seok Shim and Joyce Lee Editing by Ed Davies Our Standards: The Thomson Reuters Trust Principles., opens new tab
[2]
Kakao spin off: Kakao to spin off chat app-based platform business into KakaoAI, relist in 2027
South Korea's dominant chat app operator Kakao Corp said on Friday it plans to spin off its chat app-based platform business into a new company, tentatively named KakaoAI, while retaining investment operations in â a â firm renamed KakaoX. With this move, the company is seeking to address a conglomerate discount and strengthen business specialisation, Kakao said in a regulatory filing. The company expects the new entity to relist on the Korea Exchange on â January 27, 2027, following a planned January 1 split. KakaoAI will focus on AI, â advertising, commerce and the KakaoTalk chat app platform, while KakaoX will manage and develop holdings in areas including fintech, content and mobility, Kakao said. Kakao set 2030 targets of 6 trillion won ($4.34 billion) or more in revenue and an operating margin above 30% for KakaoAI, while setting a target of 10 trillion won or more in â revenue for KakaoX for the same year. Kakao had reported consolidated revenue of 8.1 trillion won in 2025, according to the company. Kakao also pledged 300 billion won of share buybacks and cancellations over three years after the split.
Share
Copy Link
South Korea's Kakao Corp is splitting its chat app-based platform business into KakaoAI, targeting a 2027 relist. The corporate restructuring aims to address conglomerate discount issues while KakaoAI focuses on AI, advertising, and commerce with ambitious revenue targets of $4.34 billion by 2030.
Kakao Spin Off Creates Two Specialized Entities
Kakao Corp, South Korea's dominant chat app operator, announced a major corporate restructuring on Friday that will split the company into two distinct entities
1
2
. The Kakao spin off will separate its chat app-based platform business into a new company tentatively named KakaoAI, while investment operations will remain in a firm renamed KakaoX. This strategic move addresses the conglomerate discount that has affected the company's valuation and aims to strengthen business specialization across its diverse portfolio.KakaoAI to Relist in 2027 with Clear AI Focus
The newly formed KakaoAI is expected to relist in 2027 on the Korea Exchange on January 27, following a planned January 1 split
1
. KakaoAI will concentrate on AI, advertising, commerce, and the KakaoTalk chat app platform, consolidating the company's core consumer-facing operations. Meanwhile, KakaoX will manage and develop holdings in areas including fintech, content, and mobility, allowing each entity to pursue focused growth strategies without the complexity of managing disparate business units under one umbrella.Ambitious Revenue Targets Signal Growth Expectations
Kakao Corp has set aggressive financial targets for both entities by 2030. KakaoAI aims to generate 6 trillion won ($4.34 billion) or more in revenue with an operating margin above 30%
1
2
. KakaoX has an even more ambitious target of 10 trillion won or more in revenue for the same year. These projections are particularly notable given that Kakao reported consolidated revenue of 8.1 trillion won in 2025, suggesting the company expects significant growth across both entities over the next five years.Related Stories
Share Buyback and Cancellation Program Supports Shareholder Value
As part of the corporate restructuring, Kakao pledged 300 billion won of share buyback and cancellation over three years following the split
1
2
. This commitment demonstrates management's confidence in the restructuring strategy and provides additional support for shareholder value during the transition period. The buyback program may help offset any short-term market uncertainty surrounding the split while the two entities establish their independent operations.Strategic Implications for South Korea's Tech Landscape
This Kakao spin off matters because it reflects broader trends in the technology sector where conglomerates are increasingly seeking to unlock value through business specialization. By separating platform and investment operations, Kakao Corp is positioning itself to compete more effectively in the rapidly evolving AI and digital commerce markets. The focus on KakaoTalk as a central platform for AI integration suggests the company is betting on chat-based interfaces as a key distribution channel for AI services. Investors and industry observers will be watching whether this restructuring successfully addresses the valuation challenges that have plagued diversified tech conglomerates, potentially setting a precedent for similar moves across Asia's technology sector.
References
Summarized by
Navi
Related Stories
Kakao forms strategic partnership with Google to advance on-device AI and XR integration
12 Feb 2026â˘Technology
OpenAI Expands Global Reach: Partners with South Korea's Kakao Amid Rising AI Competition
04 Feb 2025â˘Business and Economy
Kakao Founder Kim Beom-su Arrested in South Korea for Alleged Stock Manipulation
22 Jul 2024
Recent Highlights
1
OpenAI Pauses AI Development and Rolls Out New Security Measures After Hugging Face Breach
Technology
2
Humanoid Robots Shatter Usain Bolt's 100m Record, Hit 23.8 mph Before Crashing Into Safety Barriers
Technology
3
OpenAI Debuts ChatGPT for Teens With Study Mode and Parental Controls After Safety Lawsuits
Technology
Recent Highlights
Today's Top Stories
Donât drown in AI news. We cut through the noise - filtering, ranking and summarizing the most important AI news, breakthroughs and research daily. Follow topics that matter to you and stay ahead.
