Blue Walnut, a payment platform developed by Hyundai Card for future mobility, has been reporting losses for several years. Approximately half of the capital invested by Hyundai Card has been depleted. The company has struggled to overcome the low profitability typical of the electronic payment processing industry and has faced challenges in attracting external customers, leading to a rapid increase in losses.
According to the Financial Supervisory Service's electronic disclosure system on the 26th, Blue Walnut's total capital at the end of last year was 25.3 billion won, a 10.1% decrease from the previous year’s 28.1 billion won.
Blue Walnut is a wholly-owned subsidiary of Hyundai Card in the payment processing sector. Since its establishment in 2016 with an initial investment of 7 billion won, Hyundai Card has injected a total of 50 billion won through three capital increases: 13 billion won in 2018, 10 billion won in 2019, and 20 billion won in 2023. However, ongoing cumulative losses have rapidly weakened its capital base.
Despite growth in scale over nine years, profitability has not improved. Last year, Blue Walnut reported sales of 188.5 billion won, but the cost of sales reached 179.3 billion won, resulting in a cost rate exceeding 95%. While transactions with group affiliates like Hyundai Motor and Kia have expanded, the lack of a high-margin structure has limited profit generation. Additionally, rising selling and administrative expenses have solidified the loss structure.
The trend of increasing losses has continued into this year. In the first quarter, sales rose 10% to 51 billion won compared to the same period last year (46.4 billion won), but net losses grew from 400 million won to 1.8 billion won during the same timeframe.
Blue Walnut has also served as a channel for Hyundai Card to divest its underperforming affiliate stakes.
Previously, Hyundai Card and Blue Walnut established the NFT company Modern Lion in collaboration with the design firm Like a Lion in 2022. However, Modern Lion failed to achieve profitability, accumulating a net loss of 3.6 billion won by 2024. Hyundai Card transferred its entire stake (19.99%) in Modern Lion to Blue Walnut for 400 million won, effectively exiting the venture.
As a result, Blue Walnut's stake in Modern Lion increased to 41%, leading to a share of 1.5 billion won in equity method losses in 2024, more than double Blue Walnut's operating loss of 700 million won for that year. Ultimately, Blue Walnut sold its entire stake in Modern Lion last year, withdrawing from the NFT business.
* This article has been translated by AI.
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