HYBE Co., the K-pop behemoth behind BTS, suffered a double-digit profit fall in the third quarter amid the ongoing feud with Min Hee-jin, the creative director of the girl group NewJeans and the absence of new albums released during the 2024 Paris Summer Olympics.
On Tuesday, HYBE reported a 25.4% drop to 54.2 billion won ($39 million) in operating profit in the July-September quarter, compared with the same period of last year.
Net profit plummeted 98.6% to 1.4 billion won in the same period, with revenue down 1.9% to 527.8 billion won, hit by a decline in music album and download sales.
HYBE founder and Chairman Bang Si-hyuk has been in legal disputes with Min, former CEO of ADOR, the label of NewJeans. HYBE claimed Min had attempted a coup to take over ADOR with outside investors, but she refuted the allegations.
After ousting her from the CEO position, ADOR’s board of directors extended her three-year term as a board member last month, effective from Nov. 2. But the board has refused to reinstate Min as CEO of ADOR.
In the third quarter, HYBE held fewer concerts than before and did not release new albums on fears the Paris Olympics from late July to early August would take some of the shine off its artists’ performance.
The Netflix documentary series of Pop Star Academy: Katseye, which features the girl group’s apprentice period and the film of Seventeen tour follow again to cinemas made contributions to its revenue, offsetting declines in music album and download sales.
OUTLOOK
Looking ahead, the entertainment powerhouse expects a recovery in its revenue and profits in the fourth quarter of this year and pictured a rosy outlook for 2025 as the seven members of the boy band BTS are being discharged from military service.
In June, Jin, the oldest member of the group, finished the mandatory national service and J-Hope wrapped up the service in October.
“The remaining BTS members are scheduled to be discharged from the military in June next year and the day to see all its seven members in a group is getting closer,” said a HYBE official.
HYBE noted its operating margin continued to improve to 10.3% in the third quarter, versus 7.9% in the second quarter and 4.0% in the first quarter.
For all of 2024, its revenue is expected to reach 2 trillion won for a second consecutive year.
HYBE forecast a revenue growth in the current quarter as its star artists will be releasing new songs, including Jin’s his first solo act Happy scheduled for a Nov. 15 debut.
ENHYPEN, another seven-member boy band, will release a repackage album titled Romance: Untold-daydream. Girl group Le Serrafim’ new single will hit the market in Japan in December.
BoyNextDoor, a six-member boy band, will start its first concert tour next month.
SEVENTEEN has kicked off a world tour with its 13th mini album Spill the feels, which sold 3.16 million copies in the first week of its release.
Shares in HYBE gained 2.64% to close at 202,500 won, versus a 0.47% dip in the Kospi index.
By Da Eun Choi
max@hankyung.com
Yeonhee Kim edited this article.
