Good morning. We would like to now begin Naver's Q1 2022 earnings conference call. For the benefit of domestic and overseas investors, we will first begin with the presentation by the management team and then have the Q&A. If you have any questions, press one and then submit your questions. Good morning. I am Min Kim, Naver's IR Director. Thank you for joining Naver's first quarter 2022 earnings presentation. Joining our call today we have CEO Soo-yeon Choi and CFO Nam-Sun Kim. The earnings results are KIFRS based, provided for the purpose of timely communications and are yet to be audited by an independent outside auditor and hence are subject to change after the review. I will now turn it over to CEO Choi to present on the business highlights. Hello, I am Soo-yeon Choi, the CEO. Very happy to meet investors for the first time through this call today. Since joining as the CEO, I had an opportunity to closely review NAVER's services and business structure, which gave me confidence on NAVER's competitiveness. On top of search, shopping, local, pay, webtoons, ZEPETO and cloud, which are global tier services and businesses, NAVER offers breadth of value across domestic, global, online, offline users and businesses, entrepreneurs and creators, creating a potential unsurpassed by others. For the domestic business, our competitiveness is underpinned by solid business portfolio that cater to the usage flow spanning search, commerce, payment and fintech. There is no other company in the world equipped with such portfolio, and this is NAVER's differentiation. By leveraging this advantage, we will further strengthen our capacity as a platform that most effectively connects users and businesses and will expand our business model, enabling business operators and platform to generate profit together. We will also take this model of success to the global markets with speed and efficiency by collaborating with local partners. First, let's run through the domestic business, mostly around commerce. Based on user inflow from search traffic, biggest number of sellers and product database from the Smart Store and user loyalty built on easy payment and mileage point marketing, Naver commerce is the platform that can grow most cost efficiently. Quarterly GMV of Smart Store, which played a key role in the expansion of the commerce platform combined with KREAM, a C2C platform reclassified under commerce, reported KRW 6.6 trillion, up 22.4% year-over-year. While SME-centric Smart Store posted robust growth to respond to diversified users and sellers needs in step with the e-commerce market growth, we've been continuously developing solutions and services and plan to drive growth through Brand Store, Shopping Live, grocery, subscription and gifts as they will form new growth engine. These new vertical commerce categories now account for 19% of the total Smart Store GMV, with GMV up 78% year-on-year. 150 new brands were onboarded in the Brand Store this quarter as total of 771 brands generated KRW 670 billion in GMV, recording 81% year-over-year growth. KREAM, which started with resale of sneakers, has expanded to fashion and luxury, posting 194% year-on-year growth with quarterly GMV at KRW 370 billion. It will continue to broaden resale product category and eventually become Korea's number one C2C commerce services. Number of cumulative membership subscribers reached over 7 million, contributing to GMV growth. Monthly active members' GMV was doubled after subscription, while membership accounts for 40% of total Smart Store GMV. We will continue to expand commerce service lineup to follow the growth trajectory seen from Smart Store for SMEs and grow the membership program for sustained growth in the post-COVID era. Thanks to the ideal combination between the take rate and advertising model, we drove balanced growth between growth and profit from the commerce business. We plan to improve the take rate with a focus on the shopping ads and commissions as a key PM. Naver Shopping's basic take rate will be maintained so as to grow together with SMEs and brands, but in the new vertical commerce services, we will rationalize the take rate scheme in light of high conversion rate and marketing effect. Shopping ads, which is the key revenue source of Naver Commerce, will see efficiency improvement on the back of commerce, query count expansion, robust product lineup for brands and personalized recommendation based on purchase behavior, and we plan to broaden advertisers' engagement. We will outperform the market GMV growth and continue to fine tune business models to enable a higher top line revenue growth. A key differentiator of the commerce platform of Naver is its capacity to generate earnings. We have embedded the flow from search to Naver Shopping and to Naver Pay and have a structure where commerce in each business can grow in the most cost efficient manner. Marketing point that membership and Naver Pay offers, unlike one-off discount and promotions, drive repurchases, which help expand the ecosystem as the points are reused in search, commerce, Naver Pay, and content platform, creating a circular loop and with a strong focus on creating loyalty. All of this is the engine behind the growth of Naver as a whole. We will optimize membership benefits, improve marketing performance from points, which we believe can help bring commerce business to profit on par with our search business. Naver Pay's growth was in step with Naver commerce, but now as a standalone business, it's growing and making profit on its own. Q1 GMV was KRW 11.2 trillion, up 34% year-on-year. Off-platform GMV surpassed KRW 4 trillion, up 64% year-on-year, outpacing on-platform GMV for five consecutive quarters, driving growth. Off-platform growth is due to user inflow from Naver Pay adoption, which is a testament to the influence of Naver's Pay point ecosystem. We will continue to grow the size of the payment, both on and off platform, and strengthen rewards for users supported by revenue, which will create a virtual cycle of growing the payment volume of Naver Pay. In Japan, we plan to recreate the formula for success we've seen in Naver's commerce business. Japan's major portal, Yahoo, and its biggest messenger, Line, already have users and merchant base, which we will leverage in marketing and sales to solidify the flow from search commerce up to payment. Since linking up My Smart Store, Yahoo's sales team is onboarding merchants, and before the year ends, shopping search code developed by Naver and Yahoo will be released on Yahoo Search. After which, monetization will kick in with the launch of shopping search ads developed together with Naver. Japan's commerce market is three times the size of Korea's market, while penetration is only at one-third, which means great earnings potential in the long run versus domestic market. For the Webtoon business, with growth mainly centered in the U.S., we plan to actively monetize based on the 180 million global user base. Webtoon revenue was up 79.5% year-on-year, outpacing GMV growth, which is driven by rise in paying users and spending per user on top of higher take rate on cross-border content. We will make sure this trajectory continues onward. In case of more mature Webtoon business in Korea, we tested different VMs and expanded loyal user base, which led to operating profit margin of 20% in 2021. We believe there is, of course, room for further improvement. Since we are bringing proven growth strategies and business models to Japan, which is a bigger market than Korea, and since U.S. is just about to start monetizing, we expect with efficient marketing spend, total margin will improve. While looking after business growth, we will endeavor to bring a healthier organization culture as well. We've put in place ways to quickly detect signs of problem by regularly conducting organizational culture checks introduced August last year. We also designed a reliable process to prevent and deal with workplace harassment. To enhance accessibility, there are multiple channels to report and receive counseling, and we'll also set up an investigational team under the BOD with relevant expertise for the purpose of fair and speedy investigation. In the long run, the role will expand to cover human rights management so that we may look after the rights of not only our employees, but our partners and users. I will also endeavor to strengthen diversity at NAVER. The fact that I, myself, am the CEO, a young working mom, is a clear show of NAVER's philosophy towards openness and diversity. NAVER had two female CEOs back to back, and two out of seven BOD members are women. Also, 37% of NAVER are women, and every year, the percent of women in the leadership position has risen and is around at 27%. We still have a long way to go, so we will commit to making a culture of diversity, not just in terms of gender, but generation, field of expertise, background, so that we may all be recognized for our capabilities and rewarded for performance to earn a sense of accomplishment. The new management team will play a pivotal role in strengthening business linkages across search, commerce, payment, and fintech and create synergies so that we may bring sustainable growth and enhance profitability. In the global market, we will quickly bring results through active partnerships and standalone growth from businesses like the Webtoon. In this process, we will communicate and share the results more actively with investors and do what we can to make NAVER's potential be well reflected in its corporate value. We ask for the support of shareholders and investors on our journey toward challenge. With that, I turn it over to Nam-Sun Kim, the CFO, for financial highlights. Good morning. I am Nam-Sun Kim, the CFO. This call is the first time for me to be addressing the investors, and I look forward to more such opportunities going forward. With that, I will walk you through Q1 financial results. But, before that, with the new management team starting its term, we plan to provide more information so that you may have a better grasp of NAVER's business and its performance. As this is the first earnings presentation since the transition, we haven't had an ample time this time. Be assured that after we gradually put in place a detailed framework, we will make sure thorough preparation to help you better understand NAVER's business. Naver's Q1 consolidated operating revenue, driven by solid growth across all segments, was up 23.1% year-over-year. Due to slow season and accounting changes in Q4, there was a slight decline on a QoQ basis, with revenue coming in at KRW 1,845.2 billion. Consolidated operating profit was up 4.5% year-over-year. On pay rise, strategic marketing spend and broadcasting fees for the Olympics and belated lump sum copyright payment for Now Music, as well as content sourcing costs and other one-off factors which drove our partner expense, operating profit was down 14.1% quarter-over-quarter, coming in at KRW 301.8 billion. Adjusted EBITDA was down 4.7% year-on-year and 13.1% quarter-on-quarter, coming in at KRW 419.9 billion. Consolidated net profit was down significantly to KRW 151.4 billion year-on-year. This is due to gains from disposition of Line assets being reflected in the accounts following the completion of Line and Z Holdings integration in Q1 2021. Q1 operating revenue breakdown is as follows. Search platform was up 12% year-on-year to KRW 843.2 billion. For search, with broader coverage of Smart Block, a personalized search that embeds users' intent and preference, business query growth continued in local and shopping domain, which drove improvement in search quality at 3% year-on-year increase in search revenue. Display revenue showed robust growth of 20.5% year-over-year. While there was base effect from performance ad introduction over the twelve to eighteen months, we have seen a very high growth rate above the market rate. Because of this base effect, we are seeing slower growth. However, we will continue to explore growth opportunities through new ad product development and upgrading of performance ad platform, and by expanding the services of the advertisement and expansion of off-NAVER domain, we will leverage growth opportunities. Commerce revenue was up 28.3% year-over-year and 2.7% quarter-over-quarter, reporting KRW 416.1 billion. Looking at the breakdown, thanks to good performance of shopping search ad grossing revenue on par with Q4, commerce ad was up 27.5% year-over-year. Naver Shopping GMV was up 18.8% year-over-year to KRW 9 trillion. Despite union strikes at the delivery companies and seasonality in Q1 with the reclassification of KREAM and Amuse this quarter, brokerage and sales revenue was up 23.9% year-over-year and 3.5% quarter-over-quarter, sustaining a steady uptrend. This is a testament to Naver's competitive commerce model, underpinned by its search ad and 3P Smart Store. Lastly, we are seeing sustained increase in membership subscribers above 7 million, with spend per member doubling versus before membership subscription. As a result, membership revenue was up 74.7% year-over-year. Now let me elaborate on the background to the commerce revenue growth and also provide some color on earnings capacity of the commerce business, which I believe is a point of interest for many investors. Internally, we use the concept of contribution profit, which is revenue net of direct expenses, including labor cost, agency and content expenses, and strategic and discretionary business expenses like marketing spend and other related expenses such as infrastructure and outsourcing costs. Track record shows that contribution margin is around 40%, not much different for both search platform and commerce. In the second half of 2020, with the launch of the membership program, pay point reward promotional schemes were also introduced, driving down contribution margin of commerce to around 20% level. However, I can tell you that the profitability is still far above that of our peers in the industry. If you are to carve out commerce related marketing expense, including membership points, actual contribution margin can be as high as 1.5 times that of the search platform. In light of the fact that most commerce platforms would spend large amounts of logistical cost or investment in considering their IT infrastructure costs are much more inefficient compared to NAVER, this can be a differentiator unique to NAVER's shopping business' earnings capacity. Now for Fintech, GMV from merchants off platform was up 64% year-over-year, driving the total GMV growth. As a result, there was a 31% year-over-year growth. On fee cut in January as well as base effect from changes in accounting treatment in Q4, Fintech revenue was down 6.9% quarter-over-quarter, coming in at KRW 274.8 billion. The total GMV, however, is continuing on with a 3% uptrend on a Q-o-Q basis. On sustained growth from Webtoon and Snow, content revenue was up by a whopping 65.9% year-over-year. On business transfer of V Live in March, from the consolidated statements and reclassification of KREAM and Amuse sales, the effect from Webtoon accounting treatment on a growth basis, revenue in Q4, there was a 7% QoQ decline to KRW 217 billion. Driven by high quality content and expanded VM, Webtoon saw its GMV up 31% year-over-year, and with the expansion of cross-border content, revenue was up around 80% year-over-year to KRW 163.9 billion. Cloud revenue was up 15.3% year-over-year, coming in at KRW 94.5 billion. Considering the ordering cycle, we expect to see solid growth continue this year. Next is on expense items. With retroactive treatment of wage increase of 10% agreed with the union in April, development and operational expense was up 19.8% year-over-year. In Q4, there was one-off increase in expenses from preemptive developer acquisition and typical year-end incentive and severance pay provisioning and stock-based compensation, while in Q1, SBC is yet to be paid due to the high base effect. 10% basic pay increase is more than offset it, bringing development operation expense down 3.9% quarter-over-quarter to KRW 448.2 billion. During 2020 to 2021, we went out aggressively to gain a better position in talent acquisition, which led to headcount increase of 18% year-over-year. From this year on, however, aside from special circumstances like new business initiatives, we will closely look into the need for new hires. In order to improve OP margin and our hiring policy is going to be much slower than 18% in net addition, and we will manage it to the level pre-COVID. With the purchase of broadcasting rights for the Olympic Games and belated lump sum payments for music copyright and other non-recurring expenses, and on higher revenue expense, including payment and sales commissions and PPC basis points, partner expense was up 36.9% year-on-year and down 2.2% quarter-on-quarter to KRW 698.3 billion. Infrastructure expense was up 12.6% year-on-year to KRW 174.5 billion. Lastly, on the back of strategic marketing spend to gain an edge in global Webtoon competition for user acquisition, marketing expense was up 30% year-over-year and 4.5% quarter-over-quarter to KRW 222.4 billion. In terms of marketing expense, I believe it is an opportune timing to review the practical efficiency of pay points and membership, while we plan to secure performance marketing expertise for the content business, which is making inroads globally and where we will use quantifiable approaches more efficiently. Due to a decline in operational cash flow on the back of lower operating profit and higher CapEx for the new building and IDC construction, Q1 FCF was down 30% Q/Q. While versus last year, CapEx fell with lower cost for server purchase. FCF was up 13%, reporting KRW 255 billion. Despite global market volatilities and macro level risks, we will do our best to continue on with sustainable growth with the underpinning of NAVER's well-balanced business portfolio. This ends Q1 financial highlights, and we will now entertain your questions. {Foreign Language} Now, Q&A session will begin. Please press star one, that is star and one if you have any questions. Questions will be taken according to the order you have pressed star and number one. For cancellation, please press star two, that is star and two on your phone. In order to allow as many Q&A chances as possible within the restricted time, we would appreciate only two questions per participant. {Foreign Language} The first question will be presented by Eric Cha from Goldman Sachs. Please go ahead with your question. Uh, {Foreign Language} [Foreign Language } Would like to first congratulate the new management team for taking office and would also like to thank you for providing more disclosure. That is quite helpful. I will be asking two questions. One long term, the other short term. A couple days ago, the company shared with us your five-year guidance, and you also talked about the company's new business initiative. You mentioned KRW 15 trillion as your long term objective. What is the mix of the new business contribution to that figure? And from a short term perspective, considering the higher level of fixed cost, what is your projection for operating profit margin going forward? And also I would like to understand what management's view is in regards to striking a balance from a short term perspective between top line revenue and profit. [Foreign Language} Thank you for that kind words of congratulations. I would like to respond to your first and third question. Responding to your first question about that KRW 15 trillion and the contribution the new business performance is going to be making. With regards to that question, I would like to say that if you look at the history of Naver for the past every 3-5 years, we were able to grow the Naver business twofold, and our capabilities have improved over the years, and I believe that it will be possible for us to repeat that performance. In terms of the revenue growth going forward for the domestic Korean market. Just one moment, please. For the revenue growth in the Korean market, we expect we will be able to drive growth top line from Korea and also from Japan. We will be able to bring about growth in terms of search and commerce and also for the U.S. market, including the Webtoon business. We expect that there will be diverse global business from which we will be able to see top line growth. Now, regarding the new business initiative, it's not going to be a completely new business, you know, new business XYZ. We will be focusing our capabilities and what we do best in terms of search and commerce, based on which we will be able to explore new growth engine. That actually applies to our global strategy as well. All of these endeavors are reflected in that KRW 15 trillion that we previously communicated. {Foreign Language} Responding to your third question about striking a balance between revenue and profit. As an internet company, as you know, NAVER was very much focused on bringing about growth, and we believe that we have unwavering commitment behind that. However, we also believe striking a balance with profitability is an important aspect. From that perspective, we are thinking very hard as to how we could notch up the profitability from the new business endeavors that we implement. Also for this year, we will also be thinking hard as to how we can make our marketing spend and labor cost spend much more efficient. We expect through all of these efforts, we will be able to further improve our profitability. {Foreign Language} {Foreign Language} You also asked about the operating profit margin guidance, although will be quite difficult to provide you with a specific number on that. If you look at our cost structure and look at our fixed cost element, it's comprised of labor cost and infrastructure cost. You would know that. Also our marketing cost in terms may not be fixed cost per se, but it is a discretionary and strategic spending. In terms of the labor cost, as you know, last year, we have significantly increased new hires, which had a significant increasing effect on our overall labor cost. In terms of the headcount number, we believe we will be able to go back to the previous level. I mean, before that of last year. With that trend, I believe that in terms of the operating profit margin, we will be able to bring about some improvement compared to Q1 numbers. I'm sure that the analysts will be able to, you know, calculate or project that as well. {Foreign Language} The next question will be presented by Stanley Yang from JP Morgan. Please go ahead with your question. Yeah. {Foreign Language} I would also like to congratulate the new management team, CEO Choi and CFO Kim. I also have some questions relating to your mid- to long-term revenue guidance. You will be doubling your revenue in 5 years' time. Can you provide a split between domestic and global business? In terms of your global revenue growth projections, you've mentioned Yahoo Shopping search and potential monetization from these other markets. What is the revenue share scheme look like? Would like to get some color as to the size and the scale at which you would be able to benefit from such global top line growth? And what is the, I guess, contribution from inorganic or M&As in that KRW 15 trillion target? Second question relates to your e-commerce strategy. The overall e-commerce market growth has slowed and the competition has become much more fierce of late. I understand your model is asset light. You enter into partnerships and alliances. Do you plan to carry on with this strategy or would you be changing that? I ask this question because your delivery capabilities are improving, but in terms of quick delivery, how scalable would you be able to grow? You have partnerships with CJ Logistics, but compared to your competitive peers, there seems to be still some gap in terms of your delivery capabilities. I would like to understand whether you're considering investment as well. {Foreign Language} I myself and CFO will share responding to your questions. In terms of the mid- to long-term guidance, I understand that out of the net top line- You know, Naver's revenue, the global portion currently takes around 10%, and we share with you the guidance under the assumptions that we will be able to bring about 20% or more growth from that.{Foreign Language} Just to elaborate, that 10%, is a revenue, net of Line related revenue. [Foreign Language} Responding to your second question about the Yahoo Shopping, Yahoo Shopping as well as monetization for commerce. Currently, these items are under discussion with Z Holdings, our partners, so it is a bit premature for me to provide you with the details. {Foreign Language} Now, having said that, there is already a pre-existing revenue business model in Korea for Naver Shopping, and also there are contractual relationships that already exist between Yahoo and Google. In term]s of the overall structure, I do not believe there's going to be a significant difference. {Foreign Language} You asked about the inorganic or the M&A mix from that target that we shared. That KRW 15 trillion we mentioned, it's not necessarily, I guess, technically a guidance, but it is an objective for us in light of the track record of our company. Every three to five years, we believe that doubling our size will be possible. {Foreign Language} Since at this point, we do not have any definitive M&A that is upcoming, therefore it's quite difficult to say with regards to the contribution that will be made to our target from such inorganic growth, to you know to provide you with a specific figure definitively. We however believe that we will be able to attain a growth rate even aside from whether we embark on an M&A or whether there's an inorganic growth or not. We believe that the above average growth rate, which will be triggered by inorganic growth or acquisition, that element is now reflected in the target that we communicated. {Foreign Language} Responding to your second question about e-commerce market slowing its growth and whether our strategy of asset light and partnership model will continue. As we near the end of the COVID-19 pandemic, or there are different weather or climate related external factors that exist. There are multiple factors that will come into play. It is true that for the past two years, there's been a steep growth in e-commerce market. We believe that growth, we are expecting to see some normalization of that steep growth rate as we go forward. It's because of this backdrop, I believe that our strategy has been very valid. At this point, we do not have any plans to change that strategic direction. {Foreign Language} Unlike our competitors who are directly making investments into logistics network, we will continue to focus our resources on acquiring customers and SMEs, and also we continue on with the point marketing so that we could reattract the purchases of the user base and hence enhance their loyalty. I think that this model is working quite well and especially this era with COVID. In terms of logistics, we believe that user experience is critical, and we are currently expanding this strategy underpinned by partnership and alliance model. Although we are only at the beginning stage of the services, we believe that the quick delivery, especially for FMCG products, are quite important. Although the overall percentage of quick delivery is not that big compared to the number of orders that are coming in, currently for FMCG quick delivery, it's accounting for 20% of the total volume, and we are seeing a quite fast-paced growth. Our partnership with CJ Logistics, previous years, we focused on building out the system and testing those systems, and we are expanding our collaboration with CJ Logistics. Going forward, we plan to double the volume. By 2025, we plan to expand same-day delivery nationwide. {Foreign Langauge} The next question will be presented by Jae Woo Kim from Samsung Securities. Please go ahead with your question. {Foreign Language} Thank you, CEO Choi and CFO Kim. First question relates to your secondary derivative content. Would like to know the lineup of such contents that you are planning for this year, and also the size of investment that you will be making to producing those derivative content products. Second question relates to metaverse. What is your annual investment for metaverse? And in order for you to enhance quality of ZEPETO, what plans do you have in terms of making investments into solutions and services? In terms of our Webtoon and secondary content, we have dozens in the current pipeline. Recently we've seen Netflix number one from Wattpad, Webtoon, and in the year or two timeframe, we've seen, you know, more than five in terms of the top 10, you know, Netflix content. It's so hard to determine with, you know, specifically as to how many we would see going forward, but I can assure you that we have many in our pipeline. There's been a recent coverage by foreign press on this topic, but in the past, companies like Naver Webtoon, the holder of the IP, did not make direct investment or equity investment in the secondary content productions. It was usually the investments were made by OTT players like Netflix. {Foreign Language} 빨리 소진될지에 대해서는 좀 지켜봐야 될 것 같습니다. 보통 드라마는 한 편에 50억원, 뭐 같은 경우에는 극장용은 보통 한 150억원까지 갈 수가 있는데 한번 지켜봐야 할 것 같고요. However, we plan to shift this strategy slightly. We will go more aggressively into production investment. We've set aside resources for investing into such content and production of such content, and the size of that is about more than KRW 100 billion. We will be bringing the Webtoons and developing them into and producing them into dramas and full feature films. In terms of how quickly we will use up these resources, it's hard to say. Considering per drama, you know, dramas usually take up about KRW 5 billion and feature films about KRW 15 billion. That is the size of investment requirement. {Foreign Language} 그런데 이제 웹툰의 장점, 웹툰 모델의 장점이 굉장히 낮은 의 원천 IP 프로덕션이라는 점. 왜냐하면 유저들이 직접 생산을 하기 때문에 저희 들어가는 비용은 거의 없고요. 다만 앞으로 저희가 제작을 했을 때에는 이미 웹툰에서 어떠한 타이틀들이 잘 되고 있는지, 저희 웹툰 ML 엔진의 결과로 저희는 성공 여부를 계량적으로 측정할 수 있는 방법이 그 어느 제작사보다 높기 때문에 저희가 선택적으로, 선별적으로 좋은 작품의 제작에 더 많이 투자를 하면 equity upside은 앞으로 훨씬 더 많을 것으로 기대하고 있습니다. A key advantage of Webtoon is that it is a very low cost source of IP production because it's actually produced by the users themselves. What we have as a competitive edge is that we could use our machine learning engine to predict the success rate with regards to which title is going to be most successful. We can use such quantifiable measurement approaches, and we can be very selective in making significant amount of investment into production of such content. I expect there to be quite a bit of equity upside. [Foreign Language} 다음으로 관련한 투자 규모에 대해서는 저희는 의 경우에는 Naver가 그동안 잘해오던 의 새로운 방식이라고 이미 생각을 하고 있고, 그동안 와 같은 서비스나 같은 를 위한 서비스, 그리고 Arcverse와 같은 기술력을 이미 많이 확보한 상황이기 때문에 새롭게 연간 투자 규모를 잡고 있지는 않습니다. Now, Metaverse is already an area or a domain that NAVER had been doing quite well, have excelled in because it is a form of a community. Based off of the technologies and capabilities that we have in terms of, you know, for instance, Naver Cafe, BAND, Weverse, ZEPETO, as well as the technological capabilities that we've been able to culminate in Arcverse, where, you know, we already have those under our belt. We do not have any separate, you know, specific investments for Metaverse at this point. 저희는 이런 부분에 있어서도 기존의 인터넷에서 이용자들이 뭐를 하고 싶어 하는 그 본질에 집중을 해서 기술이나 서비스 기획에 더 집중한다고 보면 되고요. 새로운 서비스 트렌드를 위해서 새로운 서비스를 전혀 다른 방향으로 해석해내거나 이런 부분을 좀 신중히 보고 있다고 보시면 좋을 것 같습니다. We've been always focused on the true nature of what it is that the internet users are seeking when they are using the internet. We are really focusing on planning and developing technology and services that could cater to that. We will not be completely, you know, go off track and think of, you know, completely new services or new interpretation of those services. 말씀 주신 대로 ZEPETO 서비스의 퀄리티 개선을 비롯해서 저희가 Metaverse에 관련된 여러 가지 서비스를 만들기 위한 기술 기반에 대해서는 계속해서 저희 내재화라든지 또 D2SF와 같은 툴을 통한 투자라든지, 이 부분은 계속해서 보고 있습니다. 현재로서 정확한 투자 계획까지는 말씀드리기는 어렵지만, 기술력 확보에 대해서는 저희가 계속해 나갈 예정입니다. In terms of improving quality of the services provided by ZEPETO, as well as improving the metaverse related services, we will continuously, you know, insource or embed the technological basis and use of the D2, D2SF tools, for instance. It's hard to provide you with the concrete figure in terms of the investment plan, but we will continuously secure relevant and required technologies. {Foreign Language} 다음으로 질문해 주실 분은 의 신소윤 님입니다. The next question will be presented by Soyun Shin from Credit Suisse. Please go ahead with your question. 네, 안녕하세요. CS 증권의 신소윤입니다. 새로운 매니지먼트 취임 축하드리고, 이번에 공개하신 disclosure 유용하게 쓰도록 하겠습니다. 저는 웹툰 관련해서 두 가지 질문드리고 싶은데요. 첫 번째로 말씀해 주신 것처럼 Naver 웹툰의 한국 법인의 실적을 보면 2021년 마진이 2020년 대비 크게 상승했습니다. 그 배경에 대해서 유저 숫자나 paying ratio 혹은 cross border 매출 트렌드 등이 얼마나 기여했는지 조금 자세히 컬러 주시면 감사하겠습니다. 두 번째로는 관련하여 웹툰의 해외 법인의 경우 언제쯤 국내 법인과 같은 실적 개선 추세를 보일 수 있을 것이라고 보시는지, 그리고 올해 같은 경우 해외 사업의 성장을 위해 어떤 전략이 추진될지 공유해 주시면 감사하겠습니다. I would also like to congratulate the new management team for taking office, and thank you for these additional disclosures. I have two questions related to Webtoon. First, for the NAVER Webtoon Korea entity, we see that the margin for 2021 has significantly risen compared to 2020. Can you provide more color in regards to, for instance, user number, paying ratio and cross-border content? Second question, for your global Webtoon businesses, when do you think they will also show results that are on par with what you are seeing in your domestic business? And what is the growth strategy for your global business? Now first tackling the specific question on paying ratio and cross-border content ratio. We will communicate those figures on the upcoming quarter's conference call. We will prepare those data and communicate back to you. {Foreign Language} Now, if you look at the domestic market, we have seen a higher user loyalty as well as adoption of various different types of business models, global cross-border content and expansion of the distribution of such content. We believe that the operating margin from the domestic business has been quite positive, and I think this is attributable to the fact that we have a very solid Webtoon ecosystem in place. Of course, with the global market, we believe that we will be able to bring up that margin on par with that of the domestic market. Having said that, at this point, it is too premature to talk about when we'll be achieving consolidated basis BEP as we need to continuously make marketing spend in order for us to solidify our positioning as an unrivaled number one provider in key markets including U.S., Japan and Europe. {Foreign Language} Thanks to all of these marketing spend and our efforts and efficient marketing spend, we have already a number one positioning in major countries in the world, and also with the synergies that we are able to enjoy from acquisition of Wattpad and ebookjapan, we believe that this will continuously support improving of the user loyalty and their time spent on our services. Those indicators, we believe, will be able to come up to the level of what we are seeing in Korea in 3-4 years' time. Hence, from a long-term perspective, we expect to see margin to also improve. {Foreign Language} One more thing I would also like to add is that on a consolidated basis, if we wish, we can actually achieve BEP as of today. It's because structurally, if we increase global revenue, that's actually more favorable for the company because of the contractual arrangement we have with our partners in U.S. and in Japan, because the take rate there is higher. Also considering that the consumers from these countries and in terms of their willingness to pay, in light of that, if we see a global mix increase, then structurally that is going to feed into improving our margin. That's how the fundamentals are laid out. Due to the time constraint, we will take the last two questions. The next question will be presented by Thomas Y. Kwon from Daiwa Securities. Please go ahead with your question. {Foreign Language} I would also like to congratulate the new management team. My question first relates to, you've shared the user number or user target of 1 billion within 5 years, but globally, in light of the platform, the uniform platform and also the different situations across countries, user acquisition or for instance, acquiring paying users, all of these cycles. I think that it's gonna be more expensive for you to acquire the users. In terms of the cycle, how long and how high a cycle are you expecting? Going forward, would your focus be more on improving the operating profit versus the margin itself? Under Global 3.0 initiative, you've shared that 15 revenue target within 5 years, and I think the investors are looking forward to sharing in on that result. Would you be changing your shareholder policy going forward, or would you be sticking to the shareholder return policy that you had previously under the Global 2.0 initiative? Also, compared to when the reason why I'm asking this question is compared to the investments you are making, I think the rewards or the benefit that the investors are getting is much less in light of the MAU of 200 million and revenue of above KRW 2 trillion for LINE, for instance. Investors had been, you know, I guess, getting less than what they had expected in terms of the investment that they're making. That's the context for my question. Yes. Our objective is to achieve 1 billion user base within five years. You asked about and you had a bit of a concern regarding the investment cycle and the amount of expense that this will entail. As you know, our company has been making a challenge into the global stage for the past 15 years, and we know it very well that it is not easy to acquire new users. Through our experience in tapping into North America, Europe, and Japanese market, we were able to understand the idiosyncratic characteristics of these individual markets and have been able to employ a very efficient approach to enter into those markets. Through the content and global services, we already have a user base of 0.7 billion. Also in Japan, for search and commerce, we have partnerships with Yahoo! Japan and LINE. In North America for the Webtoon business, we have employed a very fast growth strategy which has proven to be quite valid. If we stick to such strategies going forward, we expect that without entailing significant amount of cost, we will be able to attain that 1 billion user base. I'm quite optimistic on that. Relating to a question about improving margin versus operating profit. Although we cannot share any specific number at this point, for 2022, our priority will be growing the top line revenue, at the same time controlling the labor and marketing cost, and we will endeavor to make sure we improve our margin. 주주환원정책에 대해서는 현재 저희가 다른 주주정책을 발표할 단계는 아닌 것 같고요. 다만 앞으로 저희가 네이버가 주주들한테 최대의 가치를 돌려드릴 수 있는 방법은 단순한 현금을 돌려드리는 것보다 저희가 근본적으로 경쟁 대안보다는 훨씬 우수한 사업모델들을 많이 보유하고 있는데요. 아까 설명드린 커머스의 수익구조라든지 또 웹툰의 어떤 그 매력들을 생각을 해보면 아직까지는 따라서 저희의 현 사업에 계속 재투자하는 것이 오히려 더 많은 가치 창출로 이어질 것으로 생각을 하고 있고요. In terms of the shareholder return policy, we do not have any, you know, we haven't developed any new shareholder return policy to announce. We think the best way to provide the maximum amount of value back to our investors is not in the form of cash payment, but by leveraging the already proven and excellent business models compared to our peers in terms of commerce and Webtoon business and making reinvestments into our business so as to create value. [Foreign Language] 다만 한 투자 같은 경우에는 이거는 모든 회사들의 경영진께 중요하고 어려운 숙제이긴 합니다. 투자가 회사의 주주들로 가치가 돌아와야 되는 거고, 그거를 자본시장이 인정을 해줘야 되는 거여서요. 그런 면에서는 저희가 앞으로의 M&A 경영권 인수든 어떤 비경영권 지분 투자를 했을 때 주주들의 가치가 dilute 되지 않게 어떻게 하면 더 accretive한 투자를 점점 더 많이 할 수 있을지에 대해서는 그거 역시 앞으로 저희의 숙제고, 앞으로 더 이 부분 특히 더 세심하게 저희가 집중할 것으로 말씀드리겠습니다. Now, having said that, the inorganic investment, I'm sure it's a very important topic for all of the managements of all of the companies and a difficult one. When there is an inorganic investment made, then we need to make sure that we give the value generated back to our shareholders, and whether it takes a form of acquiring a control of a business or an acquisition without a business control. What's important is that we actually bring about accretive value and make sure that the holdings of the shareholders are not diluted. We, in the process of embarking on any such initiatives, will make sure that we take care of all of these details as well. [Foreign Language] 마지막으로 질문해 주실 분은 삼성증권의 오동환 님입니다. The last question will be presented by Donghwan Oh from Samsung Securities. Please go ahead with your question. 네, 질문 기회 감사드립니다. 장기적인 비전에 대해서는 다른 분들이 많이 여쭤보셔서 저희는 짧게 한 일 년 정도를 봤을 때 성장성을 좀 여쭙고 싶은데요. 최근에 광고랑 커머스, 저희 핵심 사업들의 매출 성장이 좀 크게 둔화되고 있는 모습이 나타나고 있는데, 이 성장 둔화가 일시적인 것으로 볼 수 있는지 아니면 좀 구조적인 것으로 보시는지 궁금하고요. 성장률이 반등하게 되면 언제쯤 이런 반등이 나타날지가 좀 궁금합니다. 그리고 과거 같은 경우 검색 같은 경우, 광고 같은 경우에서 성과형 광고의 도입이 지난 몇 년간의 성장을 좀 많이 이끌었었는데, 향후에 광고와 커머스 쪽에서 어떤 상품이나 서비스의 도입이 성장 반등에 이끌지 말씀해 주시면 감사하겠습니다. Yes. My question relates to your short term, maybe one year timeframe growth. Your advertisement and commerce business in terms of the revenue growth, it had largely slowed. Is this a temporary, phenomenon or do you think this is structural? When do you think a rebound could come? Next question is for the advertisement, performance ad had actually driven quite significant growth. We'd like to understand what other products are currently in the lineup for you to bring additional growth from advertisement and commerce. [Foreign Language] 이 부분은 저희도 굉장히 중요하게 살펴보고 있고, 아마 주주분들께서도 가장 관심이 많고 또 우려 또한 있을 수 있는 부분이라 생각하는데요. 최근 한 분기의 광고 쪽 시장 구조를 저희도 관찰을 해보면 이게 저희 네이버로 유입되는 트래픽이나 클릭 수라든지 이 노출의 감소로 인한 효과라기보다, 작년 사 분기가 굉장히 좋았습니다. 굉장히 좋아서 오히려 그때보다 여러 CPM이나 PPC가 좀 떨어진 영향이 일단 컸던 것으로 분석이 되고요. Yes, that's a very important point that we are also very keenly looking into. I understand that there may be some concerns or interest on the part of the shareholders as well. If you look at the advertiser market over a quarter, if you look at the number of or the measurement of traffic, number of clicks or the impressions regarding Naver, it actually is not attributable to these factors. If you look at Q4, the performance was actually quite good, but we've seen some drop in CPM and PPC. [Foreign Language] 고무적인 것은 저희가 4월달 들어서 최근 몇 주간의 추세를 지표들을 보면 이 광고 요율들이 다시 올라오는 추세는 확실히 저희도 목격을 하고 있고, 그 말은 저희는 어떻게 해석하냐면 1분기까지는 아무래도 국내에서는 대선도 있었고, 또 여러 가지 거시적인 리스크 등으로 많은 광고주들이 실제로 마케팅 버젯들을 특정 섹터를 불문하고 전반적으로 좀 줄여온 [Foreign Language] Well, what is however encouraging is that if we track a couple of weeks' worth of indicators as we came into month of April, we are seeing the advertisement related indicators are showing an uptrend. Up until Q1, there were some, you know, elements like presidential election and macro level risks, which really, I guess, pressed the advertising budget on the part of the advertisers. There's been some decline in basically the unit cost for these advertisement. I believe that we are seeing recovery trend in the month of April, and I am quite positive on that front. Also performance ad, with the introduction of performance ad last year, we've seen a significant growth, and growth had been above market average growth. That also is feeding in as a base effect. [Foreign Language] That may also make the Q1 figures look more subdued. In terms of the performance ad growth, in the first quarter, we have newly applied performance ad and new services like mobile and securities, and we will continue to do so, increase on the services where we actually apply performance ad to mobile, PC, and many other services. In the second half of the year, we're going to also try to expand on the impression, by using external media as well. I can assure you that growth will not significantly dip and our efforts towards developing new advertising products will also continue. A good case in point is Place Ads. Our weekly number of business sellers coming on board are increasing. On a Q1 basis number of advertisers stand at 175,000. In light of the fact that total number registered into Place Ads is 2.13 million, I still believe there is room for growth. [Foreign Language] Other than that, we have special DA, display ad, and full page advertisement and dynamic advertisement, as well as upgraded targeting for performance ad. We plan to, as such, continuously develop appropriate products and services for the search platform. [Foreign Language] Thank you. That ends the Q1 2022 earnings conference call. For more questions, please contact us at the IR team. Thank you once again for joining us today, and I look forward to your support and encouragement. Thank you.