JYP Entertainment’s boy group Stray Kids attends the 2024 SBS Music Awards Summer in Seoul. The group’s activities has given its parent company a “dramatic rebound to profitability” The Chosunilbo Jns | Imazins | Getty Images
K-pop businesses mostly continued to struggle in the third quarter of the year, with three of South Korea’s four largest agencies posting poorer financial results compared to last year. The K-pop industry has been seeing a slowdown due to declining album sales and the inactivity of record-breaking groups such as Blackpink and BTS. Members of BTS have been serving their mandatory military service, while Blackpink only announced to reunite as a group in 2025. Streaming revenue, at least during the first half of this year, has been unable to cover the loss from album sales. Shares of SM Entertainment, JYP Entertainment and YG Entertainment, listed on the small-cap Kosdaq have lost 16%, 43% and 10.41%, respectively so far this year, while Hybe, listed on the blue-chip Kospi, has seen its stock drop over 11% year to date. Here’s how the “Big Four” K-pop companies fared in the third quarter:
Hybe, the largest K-pop company by market cap, did not detail the reasons for its downbeat earnings, but a Nov. 6 note issued by Yuanta Securities analyst Hwan-wook Lee said sales shrank due to limited artists and activities during the 2024 Olympics, while profitability was also hurt by higher costs owed to the launch of KATSEYE, a localized group in the U.S.
SM Entertainment CFO Jang Jeong Min said during the company’s earnings call that revenue decreased due to a decline in album sales, while operating profit was also weighed down by production costs of a debut program and weaker earnings from subsidiaries.
Samsung Securities analysts Minha Choi and Yeonghoon Kang said in a Nov. 11 note that YG Entertainment’s operating loss was “not surprising,” as the company’s artists were relatively “inactive.” For the third quarter, just Babymonster — a rookie group — and solo artist Lee Seunghoon released material.
JYP Entertainment was the lone bright spot in the industry, as it saw a “dramatic rebound to profitability” and threw an “earnings surprise,” according to a Nov. 14 note issued by NH Securities. The note said this was due to “full-fledged” activities by boy group Stray Kids, which kicked off its world tour in the second half of 2024.
Recovery in sight?