Good morning. Thank you all for joining this conference call, and now we'll begin the conference of the fiscal year 2022 fourth quarter and the full year earnings results by Kakao. This conference will start with a presentation followed by a divisional Q&A session. If you have a question, please press star one, that is star and one, on your phone during the Q&A. For reference, the announcement of management performance is made through simultaneous interpretation, and the question and answer is made through sequential interpretation. Now we shall commence the presentation of the fiscal year 2022 fourth quarter and full year earning results by Kakao.
Hello, I'm Eleanor from Kakao IR team. Now let's begin the fourth quarter and the full year 2022 earnings conference call. I am joined by Simon Hong, CEO, and Jay Bae, CIO of Kakao Group.
Please be reminded that the earnings results are consolidated estimates under the KIFRS basis and are subject to change upon the auditor's review. Also, forward-looking estimates are based on assumptions, so actual results may differ from figures included in today's presentation. I will now invite Simon to present on business highlights for Kakao, the parent and the major business results of the platform.
Good morning. I'm Simon Hong, CEO of Kakao. Last year was indeed a challenging year for our company as external factors such as macro uncertainties and the pandemic had an impact on the growth of our core businesses. Additionally, the failure incident that occurred in October caused significant concerns for our users and stakeholders. Thanks to the dedication and hard work of our Kakao crews, we were able to overcome the challenges we faced. Despite this, we anticipate that growth may be limited in the first half of this year due to the current economic outlook. This year, we will reflect on problems that have been overlooked during 10 years of compressed growth and improve our business management from structure to organizational culture. We will continue to provide more useful services for those who use KakaoTalk and create a solid business model.
On that note, let me highlight some of the changes we have planned for Kakao. KakaoTalk has driven significant growth over the years due in large part to its strong traffic. While the inbound and outbound traffic generated from the chatting tab has grown significantly and is almost reaching its limit, we believe that there is still significant potential for improvement when it comes to the communication features of KakaoTalk and its traffic. As such, our top priority for KakaoTalk this year is to segment different modes of communication, providing the best fit in terms of features and format, depending on the relationship and identity of the counterpart, thereby improving the quality of communications. For example, I'm a person who enjoys swimming, reading books, and talking to others online who share similar interests.
During work hours, I am an employee of Kakao, and when I return home, I am a father and husband. While I, as a person, remain the same, I would adopt different modes of communication depending on my role and situation. I believe that KakaoTalk should evolve into a platform that can support a wide range of modes of communication among its users as they interact and communicate within their network of relationship, which may include family, friends, colleagues, and people with shared interests. Last December, we rolled out stickers on the profile domain, offering a light-hearted way for people to share messages even with friends who they don't frequently speak to. We are also thinking of ways to change the order of the names are shown in the Friends tab, which is currently in alphabetical order to, for instance, order of importance of a frequency.
We also plan to connect multi-profile with digital ID so that it can be used in situations where credibility is required. Open chatting service will also go through some changes so that information and emotional exchanges among users of same interest can take place in a safer manner. We will strengthen open chatting feature, centering on variety of topics, including drama, movies, and large-scale promo events. We'll set it up as a separate tab, carving it out from the chatting tab, so that we can provide real-time updates and contents more quickly to users. This year, we will focus on bringing changes to KakaoTalk's essence, which is communication, and on making a solid foundation. On top of reinforcing our core business, we are exploring new growth opportunities through our focus on AI and healthcare.
We see hyperscale AI model, including ChatGPT, which has recently been the buzz, will be both an opportunity and a threat to Kakao. I say this because services developed based on AI are not differentiated by innovative ideas, but by the size of the model, which is determined by the amount of investment you put in. Because the quality is dictated by investment, global companies with their large sum of capital and technologies have an absolute upper hand in this battle.
Rather than competing head-on with global companies in hyperscale AI model, which require an astronomical amount of investment, we plan to leverage KoGPT, a Korean specialized AI model of Kakao Brain, so that we may focus on what we do best, which is vertical AI services. We will quickly introduce AI power services before the end of the year and build up on our AI capabilities in a very cost-efficient manner. In the healthcare sector, Kakao Healthcare is developing solutions and platforms to digitize and standardize medical records and clinical data held by hospitals. We will continue to collaborate with these healthcare institutions so that in the mid to long term, they can use medical big data to improve clinical care efficiency. For our users, we plan to launch real-time self-monitoring services, enabling individuals to track their health data without any time or location constraints.
Kakao Healthcare will serve as a bridge between high quality healthcare providers and individuals seeking to improve their health. With this goal in mind, we will continue to introduce services that contribute to the overall health and well-being of our citizens. Before going into highlight of business performance, I would like to take a moment to highlight our efforts in ESG management over the past year. For environmental efforts, we replaced the entire power consumption of Jeju office with eco-friendly solar energy throughout last year and achieved RE100 for our Jeju office. In addition, the Active Green Initiative, announced in April, announced plans to convert 100% of Kakao's total power consumption to eco-friendly energy by 2040.
For social efforts, we are focusing on improving digital accessibility for visually impaired people on Kakao services with the appointment of the first digital accessibility officer in the IT industry in April. In July, we established the Human Rights and Technology Ethics team as a dedicated human rights management organization, providing directions for our human rights-friendly management activities within the Kakao community. Starting in November, we launched the Kudos for Credos merchant project to help traditional market merchants easily transition to digital and are implementing programs to assist them. For governance efforts, we were the first company to set up Tech Ethics Committee last July, and also baked in tech ethics team inside key Kakao affiliates to implement measures to comply with AI code of ethics, inspect risks, and strengthen transparency of algorithms. As such, we are doing our utmost to live up to our social responsibilities.
Our efforts in ESG management have been recognized by various external entities as we were included in the Dow Jones Sustainability World Index for two consecutive years and received an AA rating from MSCI. In 2023, Kakao will remain steadfast in our commitment to sustainable growth and fulfilling our ESG responsibilities. Next is on key highlights of each business. First, the platform. For Talk Biz Ad, YOY growth was 3% as the strong growth of the Talk Channel offset the slower growth of the BizBoard. The ongoing economic recession led to advertisers reducing their marketing spend and the delay in Kakao service recovery because of the Q4 incident caused a significant decrease in Q4 revenue growth. We expect difficulties to continue on ongoing uncertainties, but we are committed to finding ways to overcome this challenge and bring sustainable growth.
As we are able to use videos for Biz Board, CPT, and message products, we expect competitiveness of branding advertising products to rise further. With strong coupling of Talk Store, store management platform, ordering, booking, and other business tools for the small to medium advertisers, we expect adoption and usability of Talk Ad products to increase by such advertisers. We will focus on making Talk Channel product number one Kakao advertising product so as to further strengthen our competitiveness as a medi-medium of advertisement. For Talk Biz commerce, including Gift, Talk Store, Makers, Grip, and Zigzag, Q4 combined GMV was up 7% YOY, while 2022 annual GMV was up 17% YOY. We saw a 12% YOY growth of delivered gift GMV, which drove overall GMV growth of Talk Gift.
Luxury brands, beauty, and fashion products were well received by users who made purchases for their own use, with Q4, the self-purchase rate for the luxury fashion category reporting 48%. This year, on top of luxury fashion and beauty, we plan to expand into premium segment of the food category frequented by older aged population equipped with higher purchasing power so as to drive continuous growth of the business. For Talk Store, we plan to showcase Kakao's unique advertising-based commerce business model by integrating Talk Channel and Talk Store this year. In the first half of the year, we will improve the service by launching a commerce-specific channel messaging feature, allowing Talk Store sellers to send targeted ads based on their purchase data to users while confirming brand news through Talk Channel and building a virtual cycle that connects to the purchase directly from Talk Store.
Next, Jay, CIO of Kakao Growth, will walk through Q4 key business highlights of subsidiaries as well as the financial results.
Hello, this is Jay Bae. Let me start with the key business highlights of subsidiaries. I will begin with the platform and others business. In Q4, mobility business showed year-over-year growth of 28%, while full year reported growth of 46%, backed by the solid growth from the taxi and driver for hire following the endemic and with the parking business making the lift. For the taxi business, due to government's price hike policy to mitigate the late night shortage, the number of providers increased. For the parking business, more than 1 million people registered Parking Pass, which provides automatic payment, eliminating the need to pay on the spot, all of which drove a stronger coupling of car owner services, including Kakao T's navigation. Going forward, Kakao T platform will become a vehicle life cycle platform supporting car maintenance to car selling.
Kakao Pay Q4 TPV was up 17% YOY to KRW 31 trillion, with annual TPV growing to KRW 118 trillion. In Q4, MAU recorded high at 23 million, and with the higher activity rate of loyal users, the proportion of users using more than three services increased to 77%. In 2023, Kakao Pay will strengthen user benefit and increase global merchants for its payment business while expanding financial product lineup to further upgrade services. Before going into content business earnings result, let me first provide some color on Kakao Entertainment's recent investment of KRW 1.2 trillion. Kakao Entertainment is driving the vision of beyond Korea, underpinned by its global value chain and unparalleled IP portfolio spanning into story, media and music.
Based upon this investment and business capabilities built up so far, we will generate added value across story, music and the media business and lay the basis for robust global growth. Next is on global story business performance. In Japan, e-manga market showed a slower growth rate of 9% YOY. Excluding the FX impact, Kakao Piccoma's annual GMV increased by 27% YOY, driving the overall growth of the industry. In Q4, to validate the efficiency of marketing spend, we lowered the marketing budget over a specified period, which drove down the revenue temporarily. With the year-end holiday campaign and resumption of marketing spend in December revenue broke the record. Backed by marketing efficiency, profitability also improved and recorded record high operating profit in Q4. We are focusing on identifying new growth momentum since the setup of globally integrated organization.
In terms of services in North America, after the introduction of free after 3 hours, which we first tested in the domestic market, daily average number of views and user metrics showed a robust uptrend. In terms of IP lineup, SK contents are gaining greater influence and accounts for 85% of total GMV. We plan to broaden the market base by increasing the supply of proven key IPs. In domestic market, we are planning to introduce strong and proven IPs one by one, given that we own more than 10,000 original IPs, which is the largest count in Korea. In Q4, The Villainess is a Marionette gained popularity with more than 150 million cumulative views. This year we plan to showcase an anchor IPs from various genre, starting with the mega IP, Solo Leveling.
We will also planning to introduce spin-offs of anchor IPs in the forms of games, animation and web novels to strengthen the proven IPs leverage. The webtoon Love Alarm, which grossed 6 billion cumulative views globally last year, was made into a drama and a variety show, successfully extending the life cycle of the IP. Story business will continue to seek balanced growth with profitability. Furthermore, we'll offer stronger experience for content consumption to our user base based upon proven IPs from both domestic and global markets. Next is media business. The film Hunt received great reviews after the release in North America, while the drama of The First Responders ranked number one in TV ratings and domestic remakes using global IPs were well-recognized in the global market.
This year we have more than three tentpole IPs to be released in key global OTT platforms, and The First Responders and Gyeongseong Creature have decided to go into season two production. As such, we will showcasing franchise of IPs in various different genre. Next is on Kakao's equity investment into SM Entertainment. For quite some time, two companies have discussed ways to cooperate, and we executed a comprehensive business cooperation agreement. Via stake acquisitions, Kakao and SM Entertainment have agreed to bring together both companies' IPs, content and technological capabilities into a strong tie-up. First, we will work together in global distribution of music to maximize IP revenue while integrating the global network to strengthen global competitiveness. Also, through co-production of K-pop artists, we will bolster competitiveness of K-pop on the global stage.
We will also build up a strong lineup focusing on artist IP capabilities on the fan platform and adopt OSMU strategy to make webtoons and characters based on the IP. We'll also utilize Seoul Arena, which Kakao is building jointly, carry for new business that leverages AI, metaverse and blockchain technology. For the game, Kakao Games, backed by stable performance of Odin, we end the release of new titles from various genre. Eversoul launched early in January, showing some meaningful early results, while ArcheAge WAR, which will be launched in Q1, is expected to successfully attract high level of standby demand for MMORPGs. Underpinned by such lineup with diversion line, we plan to drive revenue growth while investing and internalizing original IPs with high hit ratio that can bring global results. Next is on Q4 financial performance.
In Q4, consolidated operating revenue was KRW 1.8 trillion, down by 5% QOQ and flat YOY. In 2022, consolidated operating revenue was KRW 7.1 trillion, up by 16% YOY. On a quarterly basis, platform revenue was down by 2% QOQ and 4% YOY to KRW 967 billion. Talk Biz revenue was up 11% YOY and 9% QOQ to KRW 520 billion. Of Talk Biz, despite of economic slowdown leading to advertisers budget cut and opportunity costs following the fire incident, ad revenue was up 5% QOQ and 3% YOY, driven by sustained growth of message ads. Commerce revenue backed by expansion of highly profitable items in Kakao Gifts, including delivered and 1P products. Revenue showed a growth of 19% QOQ and seventy-seventeen percent YOY.
Portal Biz revenue was down 11% QOQ and 25% YOY to KRW 98 billion due to the consolidation of subsidiaries and overall decline in Daum portal's ad revenue. Despite steady growth from mobility business notwithstanding negatives such as cold weather and World Cup, platform and other revenue decreased by 15% QOQ due to decline in Kakao Pay financial service revenue and KakaoPay Securities change in accounting treatment for FX hedging. On a YOY basis, due to the base effect from blockchain and cloud service, revenue declined by 13%, reporting KRW 349 billion. Next, content business revenue was down 7% QOQ and up by 3% YOY to KRW 808 billion.
Due to the delay in new launches and low seasonality of non-game business, game revenue was down 22% QOQ and 17% YOY, reporting KRW 231 billion. Music revenue dipped 8% QOQ due to the base effect of IU concert revenue and IVE's new album releases, but on a YOY basis increased by 14% to KRW 231 billion, thanks to more concerts and album releases following the endemic. Story revenue was down 4% QOQ on the back of delay in Solo Leveling release, which is a highly anticipated IP, as well as Piccoma's downsized marketing, while posting 5% YOY growth to KRW 222 billion, backed by North American platform and rise in IP distribution revenue.
Lastly, on rise in number of titles booking production revenue like Gyeongseong Creature and The Worst of Evil, media revenue increased by 33% QOQ and 39% YOY, reporting KRW 125 billion. Consolidated operating expense and profit. In Q4, consolidated operating expense was down by 2% QOQ and flat YOY, reporting KRW 1.7 trillion. In 2022 full year consolidated operating expense was KRW 6.5 trillion, up by 18% YOY. To run through each separate item, labor cost was down 6% QOQ due to one-off accounting adjustment in Q4 on quarterly booked incentives, while it decreased by 21% YOY, reporting KRW 408 billion on the back of one-off base effect from Kakao Ventures incentives.
On the back of increase in headcount from subsidiaries consolidation and accompanying increases in labor-related expenses, on a yearly basis, labor cost was up by 19% YOY to KRW 1.7 trillion. Revenue linked expense was flat QOQ and up by 9% YOY to KRW 705 billion. Backed by increase in 1P products of Kakao Gift and content production costs were driven up, while decrease in mobile game revenue drove the decline in marketplace fees. Driven by increase in infrastructure fees following expansion of businesses across all of Kakao and its affiliates, outsourced infrastructure expense increased by 3% QOQ and 5% YOY, reporting KRW 246 billion. Marketing expense, thanks to corporate-wide efficiency efforts, decreased by 3% QOQ and 16% YOY to KRW 109 billion.
Marketing spend ratio against the revenue for Q4 was 6.1%, and on an annual basis, it was 6.8%. Depreciation increased by 6% QOQ and 35% YOY, reporting KRW 162 billion due to increase in depreciation of leased assets following the move into new office. All in all, Q4 operating profit was KRW 100 billion with OP margin of 5.7%. In yearly basis, operating profit decreased by 2% YOY to KRW 581 billion with operating profit margin of 8.2%. For your information, Kakao's separate basis revenue comprising ad and commerce business reported KRW 651 billion with operating profit of KRW 170 billion and OP margin of 26%. Next is on non-operating revenue and expense.
Other revenue was at KRW 76 billion due to disposition gains from sale of stake in subsidiaries, mostly in non-core businesses. Other expense was KRW 1.6 trillion, including Google impairment of KRW 691 billion with that of Tapas Entertainment t, and one of accounting expense related to Lion Heart stake and valuation losses from decreased market price of listed companies. Equity method gain was KRW 21 billion, declining KRW 3 billion in QOQ basis on drop in Kakao Bank's net profit. Equity method loss was up KRW 11 billion QOQ to KRW 42 billion due to increase in losses from equity method companies. Financial revenue was KRW 128 billion on the back of rise in interest income from rate hikes and rise in valuation gain from financial assets related to equity held by subsidiaries, which drove KRW 65 billion increase in QOQ basis.
Financial expense was KRW 9 billion, down by KRW 59 billion QOQ on decline in liabilities and financial expense of non-controlling stake from invested funds. In Q4, there was income tax refund of KRW 349 billion. Consolidated net loss of KRW 539 billion. In yearly basis, net profit was KRW 1.02 trillion. Lastly, on CapEx. With investments into building data centers, including machineries and constructions in progress, CapEx for tangible asset was KRW 145 billion, and CapEx for intangibles, including content-related copyright, was KRW 41 billion, amounting to a total CapEx of KRW 185 billion. This ends the earnings highlight for Q4 and full year 2022. We will now begin the Q&A. As we are mindful of the time constraint, please limit your question to two per person.
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 the star and number one. For cancellation, please press star two, that is star and two on your phone. The first question will be presented by Soyun Shin from Credit Suisse. Please go ahead with your question.
Credit Suisse Soyun Shin.
This is Jay. I will respond to your question about SM Entertainment. Kakao and SM Entertainment have been discussing with one another over a quite long period of time to find ways to further our cooperation. In terms of bringing the capabilities and competitiveness of each of the companies in relation to platform, IT technology, and IP power, we will be coupling those in order for us to maximize synergy going forward. To be a little more specific regarding each of the business areas where we will be cooperating, first, we will cooperate in the business of global music distribution. Each of the companies have strength in their own IPs, and supported by Kakao's music distribution capabilities, we will be able to expand our influence across the global music market. At this point, we are engaging in discussions as to find the most optimal way forward.
We believe that by leveraging the strong bargaining power that the companies have, we will be able to maximize the revenue from global music business. We are also talking about ways to cooperate in the global talent management business. Currently, we are thinking of integrating our domestic and global network that span across U.S., Japan, and other countries so that we can engage in and implement our global talent management business together. We will not only explore new K-pop artists and also debut them, but we will also find ways to further strengthen the tie between the competitiveness of the two companies' IPs.
In terms of the webtoon and web novel and character goods business that Kakao is involved in, we will also be onboarding SM's IP, and we will try to increase the use of, or leverage them much more actively going forward. In terms of the fan-based platform business, we have the artist and talent IPs that Kakao owns, and also we have IT capabilities which can be actively utilized in line with the currently established fan-based platform that SM has. Currently Kakao is building an arena in Seoul. Once this arena is completed, we will be able to have large scale concerts of SM Entertainment's artists, and we will be able to provide a very unique experience to the audience. The fifth aspect, we are also collaborating is on the areas of AI, metaverse, and blockchain.
We will be able to take Kakao's technologies in these areas, and we could cooperate and co-develop businesses together with SM. Going forward, we are open to other ideas. We will actively explore new business items so that we can carry out a very comprehensive cooperation in different businesses.
Hello, this is Simon. I will respond to your question about the advertisement revenue guidance.
In light of the overall macroeconomic outlook as well as how quickly our new businesses are deployed, the outcome may differ, but our internal objective is to make sure that we achieve a profitability growth that is at least on par with what we've seen last year. In the first half of the year, we expect that due to the fall in the demand that we are seeing coming in from the advertisers, that there will be some limited top line growth from the existing advertisement products.
However, starting Q1, we believe that since we're going to be upgrading some of our key ad products, including Bizboard, and also we will be strengthening the Talk channel and the My Friends tab inside the KakaoTalk platform, including the open chatting, we will be expanding new advertisement services with an objective of recovering our advertisement growth starting the second half of the year. Responding to your second question about open chatting, with regards to the timing of the launch of the application, at this point in time, we do not yet have a specific timeline in place. Whether we're going to go separately with a separate app or to release it under a new tab, that will be a decision that will be made before the end of this month.
Once we make the decision, we will come back to you and share that information with you. Now, open chatting, if you look at it, is a very activated service that bring together people of same interest in the form of a community chatting. We want to make this into a service where people could use very trendy keywords to help them discover and to explore. KakaoTalk, as the feature of open chatting becomes much more strengthened, we want to make it into a place where people are not just engaging in conversations, simple conversations on a real-time basis, but we believe that this could lead to and become a place where people could very actively engage in discoveries and exploration of different ideas. Next question, please.
The next question will be presented by Jin-Gu Kim from Kiwoom Securities. Please go ahead with your question.
Ne, Jin-Gu Kim.
Thank you. I would like to ask two questions. First, regarding your AI business strategy, what will be your specific application strategies for each of the segment? What is your take on mid to long-term commercialization likelihood of these AI solutions? What differentiates you from other peers? What is your unique competitive point? Second question relates to your Talk Biz. What is your top line objective, top line growth objective? In terms of the planned facelift or an upgrade on the profile tab, can you provide as to what the incremental impact will be on accretive revenue and also what financial impact you are looking forward to?
This is Simon. Responding to your question on AI, currently within Kakao Brain, as well as some other subsidiaries, including Kakao Entertainment, are engaged in this AI initiative.
The very foundation is based off of an hyperscale AI model. Kakao Brain is developing a KoGPT model. It's not just our internal assessment, but the assessment that we are getting from the outside is that this actually is the most cost efficient way of developing a AI model using the least amount of parameters, but still on par with the performance that is required. Now Kakao Brain announced that it will release AI for the use of medical diagnostics. It globally released an AI, well, if you look at the global stage, many companies have released AI based powered services, but they have not yet entered into a monetization phase. If you look at AI from another company, when they first released it really received a lot of highlight.
Afterwards, there were many other companies that followed suit and released similar type of AI services that at the end of the day, eroded the competitiveness of the original AI service that was launched. Kakao Brain at this point has launched services in Australia that could help with the reading and assessment of the chest x-rays and chest x-ray images. Also Kakao Brain has developed a service called Karlo. This is an image generation AI model. Once this is taken globally, and they have introduced globally a service called B^ DISCOVER. This actually is a quite good quality AI generated image.
Karlo by using Karlo, what we are planning to do is to develop an AI powered model within the first half of the year that could be applied to the profile page and the background photos for the KakaoTalk platform, to help people generate these AI powered images. I believe that AI is not simply just an operating system that you see on your mobile or the internet, like the Android or the iOS. I believe that when AI is combined with a significantly scaled platform, then the efficiencies can really be maximized. The fact that we as a company have this biggest platform in Korea, which is KakaoTalk platform, once that is also combined with the vertical AI, vertical service that Kakao Brain develops, we believe that we can really look forward to great synergies.
일대일로 채팅을 하거나, 다대다로 그룹 채팅을 하고 있는데 지금 비어 있는 영역이 일대다의 영역입니다. 실시간이 아니라 비실시간, 비실시간으로 지인과 나눌 수 있는 커뮤니케이션 영역이 좀 비어 있습니다. 그래서 이제 Profile은 그런 역할을 합니다. 혼자서 여러 사람들한테 자기 감정이나 메시지를 공유하고 싶을 때 올릴 수 있고, 이제 비실시간이기 때문에 반드시 바로 반응하는 게 아니라 언제든지 반응할 수 있는 구조로 가는 거고요. 이게 이제 다른 SNS처럼 비지인들한테는 노출되고 그런 게 아니라 지인들한테 이제 노출되는 건데, 이 Profile이 지향한 방향은 소셜 미디어가 아니고요. 가까운 사람들이 더 가깝게 소통할 수 있는 방식을 지원하는 겁니다. 그래서 꼭 이제 언어라는 게 어떻게 보면 굉장히 무거운 표현 양식인데요. 언어 이전에 공감 버튼이라든지 이모티콘이라든지 이런 것으로 서로 안부를 나누고 관심을 표하게 하는데 목표를 두고 있고요. 처음에 이제 저희가 공감 리액션 버튼부터 넣었는데 반응이 굉장히 괜찮습니다.
업데이트한 친구의 클릭이라든지, 전체적으로 친구 탭 방문자 수가
That's it. You also asked about the upgrade to the profile tab. If you look at KakaoTalk, the communication module was either one to one or many to many, but we still need to fill in the gap when it comes to one to many communication and communication on a non-real time basis. That role is performed by the profile page. Basically, it is one to many communication method. You express your emotions and you send out messages to multiple number of people, and this is not based on real time, so the responses from your friends can come with a time lag as well. It's not like a social media network where you are exposed to multiple number of people that you do not know. Basically, you are communicating with people that you know.
The whole communication with your friends and families are made much more closer through this type of features that we provide on the profile tab because words and language itself is quite heavy duty, but we've introduced light-hearted way like buttons and emojis that people could use to express themselves and communicate with one another and say hello to one another. After we introduced the button feature on the profile tab, the response has been very positive. If you look at the Friends tab, it's actually a tab where there is a significantly high number of page views and number of visits. Even if there is a 1% increase in that visit, that will still be quite significant in terms of absolute figure. Recently, we've seen even an increase of about 10%.
We see that the effectiveness of this type of feature had been quite positive.
Due to the time limit, we will take the final question. The last question will be presented by Dong Hwan Oh from Samsung Securities. Please go ahead with your question.
Uh,
Thank you very much for taking my question. My first question is that in the first half of the year, you mentioned that you will be upgrading and giving a facelift to profile features. Are there any other such plans in the pipeline? Also, can you also adopt a short form videos as it's gaining quite a lot of popularity? LINE has announced that it will be releasing short form products in the future. We'd like to understand what your strategies are. Regarding AI, these hyperscale language models entail astronomical amount of investment. I would like to understand to what extent you will be willing to make investments into Kakao Brain.
First, responding to your question about any additional upcoming facelifts or upgrade other than Talk profile and open chatting.
I mean, yes, we do have many in the pipeline, but due to the time constraint today, I won't be able to, you know, walk through every single one of them. You've mentioned short form specifically, like the shorts and the reels. Yes, they are also part of our plan for the future. If you look at the profile page already, people can put up their photos, text and emojis, and even they can upload videos in the short form as well. At this point, we're thinking as to how we could actually highlight those short form videos separately. User generated short form, yes, that is part of the plan. In terms of the professional or expert generated short form, they are being featured on the today's short form and the Daum platform.
Going forward, we will be bolstering that feature.
Yes, this is Jay. As Simon mentioned when he talked about KoGPT, for us, one of the most important aspects is cost efficiency. Basically, compared to other competing AI models, it uses less number of parameters, but the performance is on par. In terms of the amount of investment that Kakao Brain and Kakao Entertainment is making into AI, we expect and project that that amount is not going to increase any significantly from where we are today.
Well, that brings us to the end of the earnings conference call for Q4 and full year 2022. Thank you all to our analysts and investors for joining us today. Thank you.