Naver spent 1.33 trillion won ($1.1 billion) in research and development last year, nearly a quarter of its total annual sales, the company said Sunday. Its investment-to-sales ratio of 25.11 percent was the highest among all South Korean companies that release annual performance reports.

According to the company’s annual report, its investment in R&D activities was larger than its annual operating profit last year, which was 1.2 trillion won. Compared to a year earlier, the R&D spending in 2020 was an increase of 236.5 billion won.

In terms of investment amount, Naver trailed Kia Motors, which spent 1.6 trillion won in R&D activities last year. However, when it comes to the figure as a percentage against the revenue, Naver far exceeded Kia Motors, whose annual sales was nearly 10 time larger than Naver’s.

Naver’s local rival Kakao spent 535.4 billion won in R&D projects last year, which accounted 12.9 percent of the company’s annual sales for 2020, down from 14.2 percent from a year earlier.

In the local game industry, Netmarble spent 519 billion won in R&D, accounting for 20.9 percent of its combined sales in 2020. NCSoft posted a 16 percent ratio.

In 2020, Naver completed 46 projects to develop technologies in artificial intelligence, virtual reality and online platforms fields, according to the company. Naver is currently running a total of 133 R&D projects, relating to a wide range of technologies such as blockchain, facial recognition and multilingual language processing, the company added.

Naver is expected to further expand its R&D investment in the future, as hinted by Naver CEO Han Seong-sook during an investor relations conference call held to share the company’s performance in the fourth quarter last year.

By Shim Woo-hyun (ws@heraldcorp.com)