[Edaily Reporter Han Kwangbeom ] NHN(181710)plans to expand the operational capacity of its AI data centers to approximately 100 MW by the end of next year and restructure its gaming business to focus primarily on domestic web board games and Japanese mobile games. The strategy involves expanding AI infrastructure to meet surging GPU demand while divesting from low-profitability games and concentrating resources on core businesses.
NHN CEO Jung Woojin stated during the third-quarter earnings conference call on the 10th, “NHN Cloud has accelerated the expansion of its AI GPU business while reaffirming its significantly strengthened business resilience and maintaining a stable profit structure.”
NHN Cloud plans to operate AI data centers with a total capacity of approximately 100 MW, including existing facilities, by the end of next year. Regarding the plan to secure an additional 30 MW announced last August, the company has signed a letter of intent to lease a 20 MW space at the Pohang AI Data Center. The remaining 10 MW will be secured by building its own data center in the Gwangju R&D Special Zone.
CEO Jeong said, “NHN Cloud plans to solidify its strategy for securing AI data center infrastructure and acquire additional floor space, thereby transforming into an operator of data centers totaling approximately 100MW by the end of next year.”
Separately, the company will also lease the 26MW “Jangseong Fine AI Data Center,” currently under construction in Jangseong, South Jeolla Province. The plan is to secure a new hub near the existing Gwangju National AI Data Center to increase infrastructure density and improve operational efficiency.
The company has also secured additional data center space in the Seoul metropolitan area, including Gasan in Seoul and Gajo in Incheon. It plans to deploy more than 1,700 NVIDIA B300 GPUs at these locations and begin services sequentially starting in January 2027.
CEO Jeong explained, “We are currently in the final stages of finalizing agreements with customers and plan to launch services sequentially starting in January of next year and recognize revenue accordingly.” He added, “Following our success in government projects, we are achieving tangible results in private-sector projects as well, steadily expanding our customer base in the GPU business.”
◇GPU Business Profitability at 30% Based on Direct Costs…Additional Investment to Expand
The expansion of data centers is driven by rapidly growing GPU demand and business profitability. NHN Cloud has sold out its entire five-year supply of GPUs for external customers at “Factory X Seoul” in Yangpyeong-dong, Seoul. In August, the company deployed new B300 GPUs at the Gwangju National AI Data Center, and revenue has also begun to flow from KRAFTON’s GPU cluster project.
CEO Jeong stated, “We have sold the entire supply of GPUs allocated for the five-year operation at Factory X, and we have begun expanding our infrastructure by deploying new B300 GPUs at the Gwangju National AI Data Center.” He added, “We are also recognizing revenue from the KRAFTON GPU cluster project in the private sector, thereby expanding our business performance evenly across both the public and private sectors.”
NHN stated that, based on its operational experience in the GPU business to date, it is recording a profitability rate of nearly 30% on a direct cost basis. However, this figure differs from the operating profit margin, which reflects total costs such as depreciation expenses. The company did not provide specific revenue forecasts for future data center expansions, citing the many variables inherent in the GPU business. Instead, it expects the new B300 infrastructure to generate additional revenue at a level similar to that of the existing Factory X Seoul.
The company is also preparing to participate in the government’s next-generation GPU deployment project. NHN Cloud explained that it anticipates a government project involving the latest GPUs, valued at approximately 4 trillion won, to be launched next year and is considering participation. The new data center is being equipped with liquid cooling facilities to support NVIDIA’s next-generation GPU, Vera Rubin.
The growth of the AI GPU business was also reflected in the financial results. Third-quarter revenue in the technology segment reached 171.7 billion won, a 53.6% increase year-over-year. In particular, NHN Cloud’s consolidated revenue surged by 75.5%, continuing its stable trend of profitability. Ahn Hyun-sik, CFO of NHN, explained, “Revenue in the technology segment reached 171.7 billion won, up 53.6% year-over-year and 7.5% quarter-over-quarter, while NHN Cloud’s consolidated revenue grew 75.5% year-over-year.”
Cost pressures resulting from GPU investments are also becoming apparent. CFO Ahn explained, “Depreciation expenses for the third quarter totaled 37.8 billion won, a 2.0% increase from the previous quarter,” noting that this partially reflected depreciation expenses for the B300 GPUs installed at the Gwangju National AI Data Center. Higher electricity costs at the NHN Cloud Seoul Yangpyeong region were also reflected in other operating expenses.
◇ Web Board Game Growth Expected to Slow… Focus on Hold’em and Streamlining Underperforming Games
In the gaming business, the company is pursuing a strategy of “selection and concentration” by boosting the performance of existing web board games while divesting low-profitability businesses. CEO Jeong explained, “Third-quarter web board game revenue rose 16.2% year-over-year,” adding, “This reflects the impact of the Chuseok holiday at the end of September and the success of the HPT, an offline tournament series.”
In particular, “Hangame Mobile Poker” set new all-time monthly revenue records for two consecutive months in September and October. CEO Jeong said, “Due to the Chuseok holiday, Hangame Mobile Poker’s September monthly revenue reached an all-time high, and in October, it surpassed September’s performance, setting a new record for the second consecutive month.”
The “HPT (Hangame Poker Tour),” an offline poker tournament, also continues to be a hit. The 5th tournament, held last September, recorded the highest number of registrations in history, and the 6th tournament is scheduled to take place at the end of this month. However, the company predicted that the growth of web board games would slow down next year as the effects of regulatory relaxation fade. NHN stated that while it is difficult to guarantee a growth rate of over 10% as seen this year, it is aiming for revenue growth close to that level.
To this end, the company plans to actively target the Hold’em market, which can attract a customer base distinct from existing online poker users. The strategy is to acquire new users through tournaments like the HPT and expand the growth engine for web board games. Low-profitability games will be phased out. NHN discontinued “Guns Up Mobile” last May and plans to discontinue “Darkest Days” on the 24th of this month.
CEO Jeong stated, “In the gaming business, we are focusing our capabilities on domestic web board games and the operation of Japanese live games—areas where we hold a competitive edge—while streamlining certain low-profitability businesses to enhance overall operational efficiency.”
As for new titles, the company plans to launch “Puchipoyong of the Fantasy World,” a Korea-Japan collaborative project, in the first half of next year. CEO Jeong emphasized, “Starting with this title, we plan to identify new games where NHN can demonstrate its competitive edge,” adding, “We will continue to adhere to our strategy of ‘selection and focus’ to improve the performance of our existing games and achieve sustainable growth.”
Meanwhile, NHN’s third-quarter consolidated revenue reached 758.3 billion won, a 21.2% increase year-over-year, and operating profit rose 112.6% to 58.8 billion won, both marking all-time quarterly highs. Net income also increased by 115.8% to 38.9 billion won.
Revenue in the gaming segment totaled 131 billion won, up 10.7% year-over-year but down 6.2% from the previous quarter. Revenue in the payment segment rose 21.5% to 397.6 billion won, while the technology segment grew by 53.6%. Revenue in the “Other” segment fell 12.4% to 78.5 billion won due to business streamlining efforts.
