"The birth of "Upstage Company" is a meaningful first step in Korea that connects a powerful artificial intelligence (AI) model, agents, and a platform used by everyone into one. We will open an era of AI for everyone, beyond AI for corporations."
Chief Executive Kim Sung-hoon of Upstage stated accordingly on the 16th at the "Upstage Media Day" held at the Conrad Hotel in Yeouido, Seoul, announcing the launch of Upstage Company. Building on its proprietary large language model (LLM) "SOLAR" and having grown an AI business focused on corporate clients, Upstage officially declared a transition into a comprehensive AI platform corporations by putting forward the portal "Daum" and the general-purpose AI agent platform "Timely." Upstage Company consists of Upstage at the center, AXZ, the operator of the portal Daum that recently completed acquisition procedures, and the general-purpose AI agent platform Timely.
◇ "Became a unicorn, but profitability is weak and reliance on external capital is high"
Kim emphasized Upstage's growth trajectory. "More than about 200 corporations worldwide, including in Korea, the United States and Japan, are adopting Upstage AI," Kim said, adding, "New contract value in the first half of 2026 has already surpassed the entire performance of the previous year." Upstage recently said it became the first unicorn among domestic AI software corporations by raising about 730 billion won in cumulative investment, including a 100 billion won investment from the Public Growth Fund's Advanced Strategy Fund.
Still, Upstage can hardly avoid harsh assessments on profitability. According to last year's Upstage audit report, operating revenue (sales) was 24.8 billion won, up from 13.9 billion won a year earlier, but operating expense reached 55.3 billion won, far more than double sales. As a result, operating loss came to 30.5 billion won and net loss was 28.4 billion won. Although the loss narrowed from the previous year, the core business alone still shows a structure in which the burden of costs becomes more apparent as sales grow. In particular, setting aside about 4.4 billion won as allowance for doubtful accounts out of 6.9 billion won in accounts receivable raises questions about the quality of sales and collectibility.
A more fundamental issue is cash flow. Operating cash flow in 2025 was minus 34.1 billion won, worsening from minus 31.9 billion won the year before. Even so, the company's cash holdings increased to 100.4 billion won not because of money earned from operations but thanks to a 62.6 billion won paid-in capital increase. Accumulated deficits also swelled to 91.4 billion won. An IT industry official said, "In the end, contrary to the market's view of Upstage as an 'AI rising star,' its current financial statements show it is at a stage of hanging on by relying on external fundraising rather than commercializing its technology."
◇ Targeting the work automation market with SOLAR and agents
Kim also emphasized opportunities in Korea's AI industry. "Korea is an AI powerhouse equipped with everything from hardware to software and application services," Kim said. "It can enjoy strategic benefits amid the U.S.-China tech hegemony competition." The point is to cultivate a Korea-style sovereign AI in an environment where access to global AI is limited.
Upstage is also accelerating development of its own foundation model. "The preview version of the open-source model 'SOLAR Open2' under development through the 'independent foundation AI model' project scored 44.4 on the Artificial Analysis Intelligence Index (AAII), an AI performance evaluation benchmark," Kim said, explaining, "This figure is at the level of Anthropic's 'Claude Sonnet 4.6' and OpenAI's 'GPT-5.'"
Upstage delivered results in agent capabilities. According to Upstage, the SOLAR Open2 preview version scored 98% on Tau2-Bench, which evaluates agent performance. That surpasses DeepSeek's "V4 Pro" (96.2%) and is close to Anthropic's "Fable 5" (98.5%).
Kim saw the center of gravity in AI competition shifting from simple model performance to real-world task application. "There is still a lot of manual work in actual work environments," Kim said. "For successful AI adoption, it is more important how multiple agents are combined than the performance of a single model." He added, "To that end, Upstage will operate a procedural agent platform, 'Upstage Studio,' that can automate work by assembling each step like Lego blocks," and said, "We will target the corporations work automation market by combining autonomous agents with procedural agents."
◇ Spreading work agents with Timely… Daum to be revamped into an 'AI portal'
Timely, a work-use AI agent, targets an era of "one person, one agent." Timely CEO Kim Dae-hwan said, "With a single click and no separate coding, it can be deployed on the job so anyone can build their own work environment," adding, "The key is turning an individual's AI utilization experience into an asset for the entire organization."
Timely integrates and provides work-use AI agents such as image/video generation and document conversion based on various language models including SOLAR. It is currently used by about 600 entities, including local governments, public institutions and educational institutions nationwide. Through this, Upstage plans to help corporations and institutions build AI agents and work automation services without separate development staff.
The portal Daum will be reorganized into an AI portal. AXZ CEO Lee Geon-soo said, "We will combine Upstage's AI model with Daum's search data and services used by more than 10 million people weekly." Whereas existing portals showed keyword search results as links, going forward they will evolve into "hybrid search," in which an AI agent understands context and organizes answers.
Lee added, "We are also preparing a function that allows users to continue context-based Q&A with AI while reading articles within the Daum page," and said, "Instead of users navigating multiple pages to find information, we plan to introduce within the year an 'AI overview' function, in which AI summarizes search results and provides them in the form of answers."
Meanwhile, on the day, CEO Kim Sung-hoon shared a position on Upstage's IPO (initial public offering) plans. Kim said, "Since the founding, we thought the company would do well and have always been preparing for an IPO," adding, "But because there is a lot of internal discussion on the specific direction, we will disclose it once a decision is made later."