NHN為NHN Cloud提供近500 billion won債務擔保，信貸風險上升

NHN Cloud CEO Kim Dong-hoon introduces the company's AI full-stack brand, NHN Factory X, in May. (Photo: THE ELEC)

NHN's debt guarantees for subsidiary NHN Cloud have approached 500 billion won, increasing the parent company's financial burden as the subsidiary expands its data center business. Concerns are growing that NHN's credit risks could persist because new data centers take time to generate meaningful earnings.

According to disclosures filed with South Korea's Financial Supervisory Service, NHN decided on Oct. 13 to provide a 176 billion won guarantee for NHN Cloud's 160 billion won borrowing from KB Kookmin Bank. The guarantee runs for three years, through Oct. 16, 2029.

NHN previously provided two guarantees for NHN Cloud in August: a 72 billion won guarantee for a 60 billion won loan from Shinhan Bank and a 110.1 billion won guarantee related to a lease agreement for the Pohang data center.

As a result, NHN's outstanding debt guarantees for NHN Cloud increased from 116.3 billion won at the end of June to 474.3 billion won, a rise of 358 billion won in approximately three and a half months. NHN Cloud accounts for about 68% of NHN's total outstanding guarantees of 689.7 billion won.

NHN Cloud reported standalone revenue of 215.8 billion won and an operating loss of 19.8 billion won last year. Although the operating loss narrowed from 28.5 billion won in 2024, the company remained unprofitable. Total liabilities stood at 886.1 billion won at the end of last year, with its debt-to-equity ratio exceeding 768%.

AI data centers require substantial upfront capital investment, raising the possibility of prolonged financial pressure if new investments fail to generate revenue as expected.

NHN Cloud's recent performance, however, has been improving. Revenue from the business rose 85% year on year in the second quarter, driven by the deployment and operation of graphics processing units (GPUs) at the Yangpyeong data center in Seoul.

The Yangpyeong facility houses 7,656 Nvidia B200 GPUs deployed under a government program to secure AI computing resources. NHN Cloud can use 20% of the GPUs for its own commercial operations. NHN said the business is already generating revenue and that its outlook remains positive.

"NHN Cloud is not expanding its business beyond what it can financially sustain," an NHN official said. "Data centers require upfront infrastructure investment, and the current investment level is manageable." The official also assessed third-quarter performance positively and said NHN Cloud is targeting a full-year turnaround to profitability.

In a September report, Korea Investment & Securities analyst Jung Ho-yoon estimated that the Yangpyeong data center could generate 400 billion won in revenue over four years beginning in 2027 once long-term contracts are finalized.

However, there is a timing gap between the Yangpyeong data center's current performance and the expected revenue contribution from new facilities. NHN Cloud plans to secure an additional 30 megawatts (MW) of data center infrastructure by 2027. It has agreed to lease 20 MW at a data center in Pohang, North Gyeongsang Province, on a long-term basis and is considering options, including building its own facilities, for the remaining 10 MW.

The Pohang data center is being built by Hyundai Engineering & Construction and is scheduled to begin operations in the second half of 2027. This means meaningful revenue contributions from the new facility may not materialize until 2028.

Korea Investment & Securities also projected in an Oct. 12 report that the new 30 MW data center infrastructure would be completed by the end of 2027 and begin operations in 2028. Jung noted that a gap exists between improving performance at Yangpyeong and the full-scale operation of new facilities expected to provide the next phase of growth.

Profitability at the new data centers is another variable. While the Yangpyeong facility operates government-owned GPUs, NHN Cloud is likely to purchase equipment directly for its new facilities. This could reduce profitability because of depreciation expenses on equipment investments and financing costs.

With meaningful earnings contributions from new data centers still some time away, NHN Cloud's ability to generate sufficient cash to cover investment and financing costs in the interim is expected to become increasingly important.