SM Entertainment (hereafter SM) posted solid revenue growth driven by its artists' active global concert tours, the expansion of its merchandise and licensing businesses, and improved earnings at its subsidiaries.
SM said on the 5th that its second-quarter consolidated revenue rose 15.4% year-on-year to 349.6 billion won, while operating profit increased 11.0% to 52.9 billion won. On a standalone basis, second-quarter revenue rose 9.2% year-on-year to 240.6 billion won, showing balanced growth as appearance revenue grew 27.9%, concert revenue 23.6%, and merchandise and licensing revenue 22.0%. Standalone operating profit and net profit fell 4.6% and 18.1% year-on-year to 43.8 billion won and 24.1 billion won, respectively. "The results reflect concert revenue growth from the expanded scale of performances by legacy intellectual property (IP), as well as an overall improvement in management performance driven by higher revenue at major subsidiaries," SM said. "The revenue structure is also continuing to diversify through IP-based revenue growth, including expanded concert tours by veteran artists and advertising and event activities by our artists."
In the second quarter in particular, global tours by a range of artists, including TVXQ, Super Junior, EXO, aespa, and NCT WISH, contributed to the expansion of performance revenue. In addition, large-scale concert merchandise sales, along with a pop-up marking NCT's 10th anniversary and pop-up events tied to new album releases by aespa, RIIZE, and NCT WISH, broadened points of contact with fandoms and led the growth. Major subsidiaries also posted solid results in their respective business areas, contributing to overall growth. DREAMMAKER achieved substantial profit growth through an increase in domestic concert productions and expanded collaboration with the headquarters, while DearU continued its upward trend with improved profitability from subscription fee increases and a shift to web-based payments.
SM plans to remain active in the global music market in the second half of this year based on a diverse artist lineup. In the third quarter, releases include a Red Velvet mini-album (out August 3) and a full-length album by NCT 127, as well as mini-albums by Minho and WayV and a single by Girls' Generation-Hyoyeon-Sooyoung. In the fourth quarter, full-length albums by Yesung, Taeyeon, Jaehyun, and NCT DREAM, mini-albums by Max Changmin, Xiaojun, and NCT WISH, and a single by Hearts2Hearts are scheduled for release.
The concert segment will also continue active activities centered on the global stage. Along with aespa's new global tour, which begins at Seoul's Gocheok Sky Dome on the 7th and 8th and extends to North and Central America and Europe, concert tours by U-Know Yunho, Super Junior-83z, Yesung, Ryeowook, NCT 127, and WayV, as well as an NCT WISH fan-meeting tour, will take place.
