[Edaily Reporter Lee So-Hyun ] Kakao(035720)is splitting the company into “Kakao AI” and “Kakao X” to accelerate growth in the age of artificial intelligence (AI). Under this structure, the AI platform business centered on KakaoTalk will be handled by the newly established Kakao AI, while the surviving entity, Kakao X, will be responsible for core affiliates—including fintech, content, and mobility—as well as future investments.

Kakao announced on the 21st that it held a board meeting and resolved to carry out a demerger into Kakao AI and Kakao X. The split ratio, based on the book value of net assets, is 0.36 for Kakao AI and 0.64 for Kakao X. Since this is a demerger, existing shareholders will be allocated shares in both companies according to the split ratio.

Jeong Shin-ah, the current CEO of Kakao, has been nominated as CEO of Kakao iA, Inc., while Kim Do-young, CEO of Kakao Investment and Head of the Group Investment Strategy Office at the Kakao CA Council, has been nominated as CEO of Kakao X.

Kakao plans to complete the spin-off on January 1, 2027, following an extraordinary general meeting of shareholders on December 17, and to proceed with the relisting of Kakao AI and the reclassification listing of Kakao X on the 27th of the same month.

Talk to Become an AI Interface… Kakao AI Targets 6 Trillion Won in Revenue by 2030

Kakao AI will serve as an “AI core company” that connects AI, advertising, and commerce, centered around KakaoTalk. Operating subsidiaries such as DK Techin and K&Works will be incorporated under Kakao AI.

Kakao’s vision is to redesign the relationships, conversations, and service connectivity capabilities that KakaoTalk has built over the past 15 years to suit the AI era. The goal is to move beyond simply providing the same messenger to everyone and evolve it into an “agent-based AI interface” that understands the individual intentions and contexts of each of its approximately 50 million users.

The approach involves users conveying their needs via message, after which a personalized AI agent connects them to the necessary services and expert agents, providing an experience that spans discovery, recommendations, purchase, and payment.

Kakao AI plans to secure more than 20 million daily active AI users by 2030 and increase time spent on the platform by more than 50%. It will also expand new revenue models such as AI advertising, agentic commerce, and subscriptions. Through these efforts, the company aims to drive annual revenue growth of around 20% by 2030 and achieve Kakao AI revenue of over 6 trillion won.

The company expects AI revenue to account for a double-digit percentage of Kakao AI’s total revenue by 2028 and to exceed 1 trillion won by 2030.

Kakao X to Invest 2.3 Trillion Won… Exploring Virtual Assets and Physical AI

Kakao X will serve as a future-value investment firm. It will drive stable growth in fintech affiliates—such as KakaoBank Corp., #kakaopay, and KakaoPay Securities—as well as content affiliates like Kakao Entertainment, SM Entertainment, and Kakao Piccoma, and key vertical businesses such as Kakao Mobility, while simultaneously pursuing investments in new businesses and innovative companies.

Kakao explained that Kakao X will identify markets at the intersection of technology and daily life that have not yet undergone sufficient transformation and establish new standards there. Key areas under consideration include virtual assets, physical AI, and global fandom.

Kakao X plans to utilize approximately 2.3 trillion won raised through the securitization of its assets, along with approximately 4.1 trillion won in investment funds held by its subsidiaries. Based on the growth of its core businesses and the results of new investments, the company aims to achieve an average annual growth rate of 13.3% in revenue from its major businesses by 2030 and establish a growth foundation with revenue exceeding 10 trillion won.

Kakao X is expected to include KakaoBank Corp., kakaopay, Kakao Entertainment, SM Entertainment, Kakao Piccoma, Kakao Mobility, Kakao Investment, and Kakao Ventures.

Shareholder Return Policy Also Announced… “Transparent Communication of Performance”

Kakao believes that through this spin-off, as the performance and financial information of each business are accumulated independently, the value of each business will be assessed more clearly. The company explained that, based on the average consensus of the Sum-of-the-Parts (SOTP) valuation by domestic and international securities firms’ research centers as of August 2026, the Kakao Group’s potential value stands at 34.2 trillion won—approximately 17.4 trillion won higher than its average market capitalization of 16.8 trillion won over the past three months.

Following the split, both companies plan to form boards of directors tailored to the nature of their respective businesses and regularly disclose key metrics—such as revenue, profitability, investment execution, and shareholder returns—as well as capital allocation principles. They also plan to expand domestic and international investor briefings and shareholder engagement programs.

A shareholder return policy was also presented. Kakao AI will allocate 20–35% of its adjusted free cash flow (FCF) as the primary source for shareholder returns. Kakao X will allocate 30% of dividends received from subsidiaries and 30% of investment gains as funds for shareholder returns. Kakao also recently announced a plan to repurchase and cancel 300 billion won worth of its own shares using the proceeds from the sale of Dunamu.

Kakao plans to maintain stability in employment, working conditions, employee benefits, and business continuity even after the split. The services, businesses, personnel, assets, technologies, and models transferred to Kakao AI will be operated based on the continuity of existing operations.

Jeong Shin-ah, CEO of Kakao, stated, “This spin-off is a decision aimed at transforming Kakao into a structure characterized by the speed and accountability required for the AI era.” She added, “We will strive to ensure that Kakao AI and Kakao X establish strategies and capital allocation principles tailored to their respective business characteristics, execute them more swiftly, and transparently communicate their results to the market.”

Kim Beom-soo, founder of Kakao, remarked, “In the mobile era, Kakao was the first to venture down uncharted paths, driving innovation and transforming users’ daily lives.” He continued, “As the AI era demands a whole new level of agility, we will redesign our growth structure around the two engines—Kakao AI and Kakao X—and do our part to ensure that the results benefit our shareholders, users, and employees alike.”