[Edaily Reporter KIM HYUNSIK ] SM ENTERTAINMENT CO., Ltd. (041510) announced on the 4th that it recorded consolidated revenue of 291.1 billion won and operating profit of 35.5 billion won for the third quarter of this year. Revenue and operating profit decreased by 9.5% and 26.4%, respectively, compared to the same period last year.

The company disclosed that it posted a net loss due to factors such as foreign exchange losses resulting from the strengthening of the Korean won. SM explained, “We strategically conducted various overseas performances to strengthen our fanbase and small-scale events to engage with fans, which led to a reduction in domestic promotional activities for new albums. As a result, revenue from album sales, digital music, and concerts, as well as operating profit at some major subsidiaries, decreased.”
Third-quarter revenue on a standalone basis totaled 173.4 billion won, down 22.8% year-over-year. Operating profit for the period was 28.4 billion won, and net income was 11.1 billion won, representing year-over-year declines of 29.2% and 65.7%, respectively.
Looking at revenue by business segment, the Performance Division recorded 29.2 billion won, up 21.3% year-over-year, driven by an increase in artists’ advertising and event activities. The Merchandise (MD) and Licensing Division recorded 62.1 billion won, a 23.5% increase, due to strong sales of event-themed merchandise and the positive impact of intellectual property (IP) collaborations.
Among major subsidiaries, DEAR U Co.,Ltd. posted an operating profit of 9.2 billion won in the third quarter, driven by an increase in subscribers and more efficient server operations. This represents a 5.6% increase compared to the same period last year. DreamMaker returned to profitability as a result of expanded collaboration with the parent company, and KEYEAST Co., Ltd. also returned to profitability due to increased revenue from new drama productions.
However, SM Culture & Contents Co., Ltd. saw its losses widen due to increased costs associated with music-related content production, while SM Life Design Group (LDG) reported a year-over-year decline in operating profit due to a decrease in album printing revenue.
SM announced today that △NCT WISH △Yesung △Choi Kang-changmin △Xiao Jun △RIIZE △Red Velvet’s Irene & Seulgi △NCT DREAM △Taeyeon △EXO Unit (Kai, Sehun) △U-Know Yunho, among others, will release new albums domestically and internationally in the fourth quarter of this year. In the first quarter of next year, △RIIZE △Hearts2Hearts △Seulgi △Jaehyun △SUPER JUNIOR-83s △NCT’s Jeno and Jaemin △Chen Lu, among others, will release new albums.
Artists scheduled to perform domestically and internationally in the fourth quarter of this year and the first quarter of next year include △NCT 127 △EXO △WayV △Choi Kang-chang-min △Minho △Yesung △U-Know Yunho △Chanyeol △Red Velvet’s Irene & Seulgi △SUPER JUNIOR-83s △NCT WISH △aespa, among others.
SM stated, “We plan to build a balanced IP portfolio by actively promoting the expansion of activities for our legacy artists, the growth of our newer artists, and entry into new markets.”