HYBE, the South Korean entertainment company behind BTS, has reported a significant decline in its operating profit and net profit for the third quarter.
HYBE announced on November 5th that its consolidated operating profit for this year’s third quarter dropped 25.4% from the same period last year, down to 54.2 billion won. Sales for the same period declined by 1.9% to 527.8 billion won. Net profit saw the sharpest decline and fell by 98.6% to 1.4 billion won.
Direct participation revenue, which makes up part of total sales, declined 18.8% from last year to 323 billion won. In contrast, indirect participation revenue performed well, rising 31.8% to 204.9 billion won. Direct participation revenue includes album sales, concerts, advertising, and appearance fees; of these, album and music sales dropped by 18.8%, while concert revenue fell by 14.8%.
HYBE explained that even though there was a major global event, such as the Olympics, that could have affected their business, they were still able to maintain strong sales and performance. This was thanks to the success of their various artists, including the growth in album sales for ENHYPEN and BOYNEXTDOOR, the million-selling Japanese debut single of NewJeans, and the strong music chart performance of BTS’s Jimin and LE SSERAFIM.
Indirect participation revenue, which includes sales from merchandise, licensing, content, and fan clubs, increased by 32%. Among these, content sales saw a significant increase of 64%.
For the fourth quarter, HYBE expects a strong boost in direct revenue from several upcoming releases and events: BTS member Jin’s solo album release on November 15th, SEVENTEEN’s world tour following their triple million-seller album, TOMORROW X TOGETHER’s encore concert and seventh mini album release, ENHYPEN’s repackaged album on November 11th, LE SSERAFIM’s Japanese single in December, BOYNEXTDOOR’s first solo concert tour in December, and the ongoing promotions of &TEAM, who recently surpassed one million album sales.
Having already made over 1.5 trillion won in the first nine months of this year, HYBE is on track to reach 2 trillion won in annual revenue for the second year in a row.
Despite these achievements, HYBE faces ongoing challenges. Disputes with former executives and internal controversies, such as the leaked industry report, have led to fan backlash and potential negative impacts on the company’s reputation.
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Furthermore, HYBE has drawn criticism after granting 12,174 restricted stock units valued at 3.6 billion won to 20 executives on October 22nd, even amid a steep drop in net profit. ADOR CEO Kim Joo Young, who recently appeared at a parliamentary audit, received the largest share with 2,141 units valued at around 420 million won.
HYBE CFO Lee Kyung Jun commented, “We are currently in discussions with the BTS members regarding a potential full-group comeback in 2026. While a reunion would certainly generate substantial revenue, we expect the growth of other artists and new business areas to coincide, so the overall revenue increase may not be as high as in the past.”
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