[Edaily Reporter Han Jeon-jin ] South Korea’s three major department store chains—Lotte, Shinsegae Co.,Ltd., and HYUNDAIDEPARTMENTSTORECO.,LTD—all posted strong financial results for the second quarter of this year. All three saw operating profits in their department store divisions surge by more than 50%, marking a significant improvement in profitability. Amid sluggish domestic consumption, a surge in foreign tourists has filled the gap, and investments in the renovation of key stores—which have been ongoing for several years—are now beginning to yield tangible results.

According to industry sources on the 11th, all three department store companies saw significant increases in both sales and operating profit in their department store divisions during the second quarter. Lotte saw the largest improvement in profitability, with operating profit surging by over 80%, while Shinsegae Co.,Ltd(004170)recorded the highest sales growth rate among the three companies. HYUNDAIDEPARTMENTSTORECO.,LTD(069960)also continued its growth momentum, achieving its highest-ever second-quarter sales in the department store division.

LOTTE SHOPPING CO., LTD.(023530) The Department Store Division posted second-quarter sales of 891.2 billion won, a 9.2% increase year-over-year, marking the highest second-quarter sales in history. Operating profit rose 84% to 119.7 billion won. Customer traffic remained strong, particularly at large stores such as the Main Store and the Jamsil Store, and the results were driven by increased sales to foreign customers and balanced growth across all product categories. Overseas operations also maintained stable growth, with Lotte Mall West Lake Hanoi in Vietnam posting its highest operating profit for the sixth consecutive quarter.

Shinsegae Co.,Ltd.’s second-quarter sales reached 738.5 billion won, up 17.5% year-over-year, while operating profit rose 53.5% to 108.8 billion won. It posted the largest sales growth among the three companies. Renovations centered on the Main Store and Gangnam Store, along with investments in content, drove the improvement in performance. Luxury goods sales rose 35% in the first half of the year, while fashion (10.1%), home goods (16.6%), and food (13.7%) also saw steady growth. Sales to foreign customers reached 580 billion won, a 120% increase compared to the same period last year.

HYUNDAIDEPARTMENTSTORECO.,LTD also recorded its highest-ever second-quarter sales in the department store sector, with sales of 643.8 billion won—a 9.1% increase year-over-year. Operating profit rose 58.6% to 110.1 billion won. This result stems from strong sales of luxury goods, watches, jewelry, and fashion, combined with an increase in foreign customers. In the first half of the year, foreign sales at The Hyundai Seoul and the Trade Center branch rose by 134% and 131%, respectively, and the share of foreign sales at these two stores expanded to approximately 20%.

The recovery in foreign consumer spending is cited as a key driver of the department store’s improved performance. According to the Korea Tourism Organization, the number of foreign tourists visiting Korea in the first half of this year reached 10,709,919, a 21.3% increase compared to the same period last year. During the same period, foreign credit card spending on tourism surged 50.8% to 10.0389 trillion won. Industry observers attribute the improvement in overall department store performance to the expansion of foreign consumer spending—which had previously been concentrated on luxury goods—to domestic fashion, home goods, and food.

Competition among stores is expected to intensify further in the second half of the year. Lotte Department Store plans to refine its “Townization” strategy—centered on Myeongdong and Jamsil—and expand it to its Incheon branch. Shinsegae Co.,Ltd will sequentially launch the overseas luxury designer apparel section at DaeguDepartmentStore, the women’s fashion section at the Hanam branch, and “Hyperground” at the Cheonan-Asan branch. HYUNDAIDEPARTMENTSTORECO.,LTD plans to continue targeting foreign customers, focusing on key locations such as The Hyundai Seoul and the Trade Center branch.

A retail industry official stated, “The department store sector is recovering faster than expected, driven by a combination of rising tourist arrivals and the effects of renovations,” adding, “However, companies that continue to secure differentiated content and competitive spatial offerings—rather than relying solely on foreign demand—are likely to maintain their growth momentum in the second half of the year.”