South Korean entertainment giant SM Entertainment Group reported a 5.2% YoY jump in group revenue for the first quarter of 2025, driven by increased music and concert revenue.
The agency, home to K-pop acts such as NCT 127, EXO, RIIZE, and aespa, booked KRW 231.4 billion (approx. USD $165.7 million at the average exchange rate for the quarter) in Q1 group revenue, up from KRW 220.1 million ($157.5m) a year earlier, according to its quarterly report published Wednesday (May 7).
Of that total, revenue at parent company SM Entertainment rose 21.5% YoY to KRW 165.5 billion ($114m), which it attributed to strong music revenue despite a drop in new album sales.
New album sales in Q1 2025 dropped to 920,000 units from 2.76 million albums sold in Q1 2024. This was offset by an increase in concert revenue as NCT, aespa, TVXQ!, YESUNG, MINHO, TAEYEON and WayV went on global tours during the quarter.
Meanwhile, revenue at the group’s major subsidiaries plunged 16.8% YoY to KRW 104.5 billion ($72m) as revenue at SM Culture & Contents, the group’s advertising, production, travel and talent subsidiary, continued to drop, falling 26.1% YoY in Q1 to KRW 17.7 billion ($12.2m).
Revenue at SM’s Japan-focused subsidiary Stream Media Corporation fell 23.9% YoY to KRW 20.8 billion ($14.3m) due to reduced number of concerts in Japan, while revenue at SM’s SM Brand Marketing unit, which focuses on intellectual property (IP) licensing, management, and marketing, fell 82.3% YoY due to a decrease in the number of dramas aired.
Overall, operating profit in Q1 soared 109.6% YoY to KRW 32.6 billion ($22.5m), which the company attributed to “revenue mix change and one-off music revenue.”
Net profit during the quarter skyrocketed 1,852.4% YoY to KRW 242.9 billion ($167.4m), boosted by the acquisition of superfan app operator DearU. In a presentation that accompanied its Q1 results, SM Entertainment said the DearU consolidation further enhanced its earnings.
The company added that it witnessed an increase in asset value through the revaluation of its equity interest in DearU. DearU is set to launch in China via a strategic partnership with Tencent Music, SM revealed.
SM Entertainment recently launched its new girl group, Hearts2Hearts, whose debut album, which dropped on April 24, already sold 408,000 copies in its first week.
During the first quarter, SM rolled out a number of initiatives to further grow its business. In March, the company announced that it will launch a training academy for K-pop hopefuls in Singapore, via its subsidiary SM Universe.
Looking ahead, a number of the company’s artists are set to drop new singles and albums in Q2 and Q3 including new singles from SHINee, aespa and Hearts2Hearts, and new albums from KAI, RIIZE, BoA, SUPER JUNIOR, KEY, and NCT DREAM.
SM rival HYBE also published its Q1 results recently, posting a 38.7% YoY jump in revenue to KRW 500.6 billion ($358.5m), a 50.3% YoY increase in operating profit to KRW 21.6 billion ($15.5m), and a 398% YoY jump in net profit to KRW 55.3 billion ($39.6m).
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