Naver raises $1 billion from Nvidia to build AI factories

Naver will raise $1 billion from Nvidia through a third-party share allotment, according to a regulatory filing on October 30. Payment is set for November 6 and the new shares are scheduled to list on November 27, the filing shows. The issue price is 204,500 won per share, about $138 at the board-resolution-eve exchange rate of 1,480.9 won per dollar.

The investment will make Nvidia Naver's third-largest shareholder. Korea JoongAng Daily and Maeil Business report that Nvidia will hold about 4.5 percent, while Wowtale reported about 4.8 percent. Founder Lee Hae-jin's stake will fall from 4.03 percent to 3.84 percent, moving him from third to fourth place, behind the National Pension Service and BlackRock.

The financing is part of a $10 billion AI factory project Naver announced in July with Brookfield and Nvidia. Naver will spend the proceeds on its AI factory business, which involves data centers packed with servers and GPUs that companies can rent to develop or run AI systems. Brookfield, a global investment firm, plans to invest up to $9 billion in the needed computing infrastructure, while Nvidia supplies the GPUs and technology. Naver Cloud will operate the data centers and sign up corporate customers, then pay Brookfield fees tied to revenue and keep the difference as profit. The share sale was conditioned on Naver lining up at least $9 billion in outside computing infrastructure for the AI factory expansion, and Naver said it met that condition by agreeing with Brookfield on October 27.

The corrected filing breaks down the planned spending: about 5 billion won in 2026, 692 billion won in 2027, and 783.8 billion won from 2028 onward, based on the 1,480.9 won-per-dollar exchange rate. The company cautioned the amounts could shift as the project develops. Nvidia cannot sell or withdraw the investment for at least one year, Maeil Business reported. The final share count is scheduled for November 3, three business days before the payment date, and will be based on that day's average Seoul Money Brokerage market rate divided by the issue price.

Naver's push into AI factories comes as its core search business faces pressure. Google's app surpassed Naver's monthly active users in July for the first time since 2021, according to Mobile Index data cited by Korea JoongAng Daily. ChatGPT's monthly active users in Korea climbed from 14.3 million in January to 17.99 million in September, a 25.8 percent increase, according to Korea JoongAng Daily. Alphabet shares tumbled 12.6 percent Thursday after third-quarter search ad revenue disappointed Wall Street. Kookmin University business professor Kim Do-hyeon told the newspaper, "The biggest risk is that AI agents could take over the initial interaction with customers, which would deal a serious blow to both search and e-commerce." Lee said at a meeting last November regarding the Dunamu merger, "The business comes first, not my ownership stake." Naver plans to open 55 megawatts of AI factory capacity in the first half of 2027 and later grow that to 1 gigawatt. Naver said in July that reaching 1 gigawatt could bring in about 20 trillion won in yearly revenue.