0751 GMT - Kakao's earnings could miss market expectations, HSBC analyst Junhyun Kim writes in a note. The South Korean mobile-internet company's shares have outperformed the benchmark Kospi recently, reflecting market hopes for artificial-intelligence and other initiatives to boost revenue growth, Kim says. "We are still cautious on potential disappointment from earnings misses that could fall short of expectations," he says. With roughly one-fifth of South Korea's population already using the ChatGPT application, the company may face increasing difficulty in monetizing AI services. "Without meaningfully differentiated functions that enhance users' convenience, we think Kakao will struggle to find new revenue streams," he adds. HSBC raises the stock's target price by 46% to KRW60,000 but maintains a hold rating. Shares closed 9.1% lower at KRW63,100. (kwanwoo.jun@wsj.com)

(END) Dow Jones Newswires

June 26, 2025 03:51 ET (07:51 GMT)

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