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South Korean IT Giant Kakao Plans to Complete Spin-off This Year, New Entity to Focus on AI Agents
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- DeepHorus
South Korean IT giant Kakao announced a major strategic restructuring plan on August 21. The company held a board meeting on that day, formally deciding to split its existing businesses into two independently operated entities through a personnel division. This move aims to better adapt to the AI era and optimize capital allocation. The newly established company has been named Kakao AI, while the continuing entity will be named Kakao X.
According to the split plan, based on the net asset book value, the newly formed Kakao AI will account for a 36% share, while Kakao X will hold 64%. Kakao stated in its announcement that this split is intended to establish a more agile decision-making and investment structure in the rapidly changing AI market. Analysts believe this marks a core strategic transformation where the tech giant is betting its future on artificial intelligence.
The newly established Kakao AI will become the central hub for the group's AI business, with its core focusing on the national communication app KakaoTalk and the internally developed Kanana large language model. The company's primary goal is to specialize in developing highly integrated AI agents. Kakao AI plans to leverage the vast user data and services within the Kakao ecosystem to create a seamless AI experience.
Kakao AI outlined its future vision: in the future, users will only need to issue natural language instructions to the AI within the KakaoTalk chat interface, and the AI agent will autonomously complete a series of complex tasks, including information search, product purchase, and even online payment. The company ambitiously proposes a goal of increasing users' average daily time spent on the Kakao platform by over 50%.
In terms of financial targets, Kakao AI has set an aggressive growth path. The company plans to achieve an average annual revenue growth rate of about 20% by 2030. According to its projections, the annual revenue target will reach 6 trillion Korean yuan, approximately 29.106 billion Chinese yuan. This reflects management's strong confidence in the commercialization prospects of AI agents.
Meanwhile, the continuing company Kakao X will integrate and develop existing non-AI core business segments. This includes subsidiaries such as Kakao Bank, Kakao Pay, and the acquired entertainment company SM Entertainment. Additionally, Kakao X will actively explore emerging fields such as virtual assets in the future and take on the role of venture capital for innovative technology enterprises within the group.
Kakao has set a clear timeline for this split. The company plans to convene an extraordinary general meeting on December 17, 2024, to vote on the split plan. If smoothly passed, all legal procedures are expected to be fully completed before January 1, 2027. This paves the way for subsequent independent business operations.
After the split is completed, Kakao AI plans to relist its stock in the capital market on January 27, 2027. At the same time, Kakao X will also complete its renaming and achieve listing. This split will reshape the competitive landscape of South Korea's tech industry and will serve as an important case study for global tech companies adjusting their organizational structures in the AI era.
