Kakao to spin off chat app-based platform business into KakaoAI, relist in 2027

Kakao Corp, South Korea's dominant messaging app operator, announced plans to spin off its chat app-based platform business into a new company, tentatively named KakaoAI, effective January 1, 2027.

The strategic move aims to tackle the "conglomerate discount" – a phenomenon where a company's stock market valuation is lower than the sum of its individual business units – and foster greater specialization within its operations. Following the split, the existing firm will be renamed KakaoX.

KakaoAI is slated to concentrate on artificial intelligence, advertising, commerce, and the core KakaoTalk chat app platform. Meanwhile, KakaoX will oversee and develop investments in sectors such as fintech, content, and mobility. The company has set ambitious targets for KakaoAI, projecting revenues of 6 trillion won ($4.34 billion) or more and an operating margin exceeding 30 percent by 2030. For KakaoX, the revenue target is set at 10 trillion won or more for the same year.

In conjunction with the restructuring, Kakao pledged to undertake share buybacks and cancellations totaling 300 billion won over the three years following the split. The company reported consolidated revenues of 8.1 trillion won in 2025. The new entity, KakaoAI, is expected to relist on the Korea Exchange on January 27, 2027.