SM Entertainment (Co-CEOs: Jang Cheol-hyuk, Tak Young-jun) announced on the 7th that it recorded a consolidated operating profit of 32.6 billion KRW in the first quarter of this year, an increase of 109.6% compared to the same period last year. During the same period, sales increased by 5.2% to 231.4 billion KRW, and net profit surged to 24.29 billion KRW, a remarkable 1,852.4% increase, driven by the acquisition of a stake in Dear U, the operator of the paid fan-artist messaging platform ‘Bubble.’
On a separate basis, performance figures increased by 21.5% in sales to 165.5 billion KRW, 105.2% in operating profit to 41.3 billion KRW, and 94.1% in net profit to 32.2 billion KRW. Despite a slight decrease in album sales, the expansion of music sales, growth in global concerts, and increased revenue from MD and IP licensing contributed to the performance improvement.
In the first quarter, rookie girl group ‘Hot Issue’ formed a global fandom by surpassing 400,000 copies with their debut single, while trainee group ‘SMTR25’ garnered attention even before debut with the release of content, proving the growth potential of new IPs.
The monetization strategy for IPs is also gaining momentum. Initiatives such as the character pop-up store of Riize, collaboration between SHINee Key and Hello Kitty, and the diversification of MD and IP businesses are underway. Plans to accelerate expansion into overseas markets through collaborations with Tencent Music in China and the integration of Dear U are also in progress.
In the second quarter, major artists such as aespa, Red Velvet, and NCT Doyoung are scheduled to release new albums, and it is expected that concert revenue will also pick up momentum through global tours of Kai, Riize, and NCT Dream. In the third quarter, large-scale IP-based releases are planned, including Super Junior’s 20th-anniversary regular album and aespa’s mini-album.
Co-CEO Jang Cheol-hyuk stated, “The rapid establishment and monetization of new IPs have contributed to the growth in performance,” and expressed the commitment to continue promoting the diversification of IP businesses and expansion into the global market based on the SM 3.0 strategy.