South Korea\u2019s SM Entertainment<\/a>, known for K-pop acts such as NCT 127, EXO, Riize, and aespa, has reported a massive increase in revenue and profit, driven by a streak of hit albums, rising concert revenue and growth at fan platform DearU.<\/p>\n The company reported a 261.6%<\/strong><\/span> year-over-year increase in operating profit for the third quarter of 2025, to 48.2 billion<\/strong> won, or USD $34.8 million<\/strong> at the average exchange for the quarter.<\/p>\n Revenue came in at KRW 321.6 billion<\/strong> ($232 million<\/strong>), up 32.8% YoY<\/strong><\/span>. The higher revenue, combined with gains in non-operating income and lower corporate taxes, propelled the company to a 1,107.0% YoY<\/strong><\/span> increase in net income, to KRW 44.7 billion<\/strong> ($32.3 million<\/strong>).<\/p>\n Excluding subsidiaries, digital and physical music sales at the parent company grew 32.7% YoY<\/strong><\/span> to 96.7 billion<\/strong> ($69.8 million<\/strong>), driven by a string of million-selling albums, including NCT WISH<\/strong>\u2019s mini-album Color<\/em> (1.48 million<\/strong> album equivalents sold), aespa<\/strong>\u2019s mini-album Rich Man<\/em> (1.13 million<\/strong>) and NCT DREAM<\/strong>\u2019s Go Back to the Future<\/em> (1 million<\/strong>).<\/p>\n Concert revenue rose 37.5% YoY<\/strong><\/span> to KRW 52.5 billion<\/strong> ($37.9 million<\/strong>). Despite a decrease in the total number of shows, revenue grew thanks to an \u201cexpansion in scale of SM artists\u2019 performances,\u201d Chief Financial Officer Jeongmin Jang<\/strong> said on the company\u2019s earnings call Wednesday (November 5).<\/p>\n The company posted solid growth in merchandising and licensing revenue, up 32.8% YoY<\/strong> to KRW 50.3 billion<\/strong> ($36.3 million<\/strong>), which Jang attributed to sales of aespa merch and pop-up stores for NCT WISH and Super Junior<\/strong>. SM also saw 6.7% YoY<\/strong><\/span> growth in revenue from appearances (TV, advertising and events) to KRW 24.1 billion<\/strong> ($17.4 million<\/strong>).<\/p>\n \u201cOur leading artists have continued to prove their solid capabilities while new IPs are growing rapidly and adding fresh energy to the company,\u201d CEO Cheol-hyuk Jang<\/strong> said on the call.<\/p>\n \u201cThis generational synergy further reinforces the foundation of our IP portfolio, exemplifying the virtuous cycle of a sustainable IP ecosystem that SM Entertainment aims to build.\u201d<\/p>\n \u201cOur leading artists have continued to prove their solid capabilities while new IPs are growing rapidly and adding fresh energy to the company.\u201d<\/p>\n Cheol-hyuk Jang, SM Entertainment<\/span><\/p>\n<\/blockquote>\n One new earnings driver at the company is fan platform DearU<\/strong>, which operates Bubble, a messaging service that connects artists with fans. SM consolidated DearU into its balance sheet earlier this year after taking a larger stake<\/a> in the platform. SM now controls 45.1%<\/strong> of DearU.<\/p>\n DearU accounted for KRW 22.3 billion<\/strong> of SM\u2019s revenue, up 10.5%<\/strong><\/span> from the second quarter, when the platform first appeared in SM\u2019s earnings. Growth was driven by an increase in subscribers and a subscription price hike in July, CFO Jang said.<\/p>\n The company\u2019s subsidiaries are experiencing a significant turnaround, swinging to a positive operating profit of KRW 13.5 billion<\/strong> ($9.7 million<\/strong>), compared to an operating loss of KRW 10.1 billion a year earlier.<\/p>\n Net income came in at KRW 15.3 billion<\/strong> ($11.0 million<\/strong>), compared to a loss of KRW 10.6 billion a year earlier.<\/p>\n That came on the back of a 20.6% YoY<\/strong><\/span> increase in revenue at the subsidiaries, to KRW 146.8 billion<\/strong> ($105.9 million<\/strong>).<\/p>\n Talent agency, TV production company and travel agency SM C&C<\/strong>, the company\u2019s largest subsidiary by revenue, reported a 2.5% YoY<\/strong><\/span> increase in sales to KRW 25.4 billion<\/strong> ($18.3 million<\/strong>), which the company attributed to an increase in advertising revenue.<\/p>\n\n
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