SM's Q2 Revenue Rises by 5.9% to 253.9 Billion Won, Operating Profit Falls by 30.7%

▲ This file photo, provided by SM Entertainment, shows its Seoul headquarters in eastern Seoul. (PHOTO NOT FOR SALE) (Yonhap)

SEOUL, Aug. 7 (Yonhap) -- SM Entertainment announced on the 7th that its consolidated revenue for the second quarter of this year reached 253.9 billion won, with an operating profit of 24.7 billion won.

Compared to the same period last year, revenue increased by 5.9%, while operating profit decreased by 30.7%.

SM explained, "The revenue grew due to increased album sales and concerts, but the operating profit decreased due to higher content production costs and operating losses from subsidiaries."

The net profit for the period was 8.4 billion won, a decrease of 70.3%, and the operating profit margin dropped by 5.1 percentage points to 9.7%.

On a standalone basis, Q2 revenue was 174.1 billion won, up 25.4%, and operating profit was 29.3 billion won, up 4.6%. SM attributed the revenue growth to an increase in concerts and merchandise (MD) sales.

This month, SM will introduce the British boy group 'DEAR ALICE', co-produced with local entertainment company Moon&Back for the BBC TV series 'Made in Korea: The K-Pop Experience'.

In the third quarter, new releases from NCT's sub-unit NCT Wish, SHINee's Key, and NCT's Jaehyun's first solo album are expected. SM's first virtual singer, Naevis, is also set to debut.

In the fourth quarter, full-length albums from NCT Dream, mini-albums from Taeyeon and aespa, and a highly anticipated new girl group will be released.

Particularly noteworthy is the formation of a 'Trot Idol' group composed of five talented individuals from 'Mr. Trot', K-pop trainees, and actors. Their growth story will be featured on TV programs in Korea and Japan, followed by a nationwide tour after the show's conclusion.

SM also plans to debut a new male rookie team next year.

Jang Cheol-hyuk, co-CEO of SM, stated, "We are expanding the music genres to include classical, R&B, and trot, and extending our IP not only in Asia but also in English-speaking regions. We aim to achieve IP expansion through various formats such as a multi-production system and internal and external labels."

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