SM Entertainment, home to K-pop groups such as NCT 127, SuperM and Girls’ Generation, reported revenues of KRW 238.1 billion ($165 million at September 30 exchange rates) from July 1 to September 30. – a year-on-year increase of 65.4%. up 29.1% sequentially, the company announced on Monday (Nov. 14).
Operating margin — operating income as a percentage of sales — improved to 12.5% in the third quarter of 2022, from 6.9% in the prior-year period. Net income was KRW 29.2 billion (US$20.2 million), up 129.5% year-on-year and 15% higher than the second quarter.
The company’s diversified business, which generates revenue across all facets of its artist careers, improved across the board, with recorded music revenue up 46.6% to 135.1 billion won ($93.6 million). SM Entertainment’s album sales improved to 4.7 million units from 3.25 million units in the same period last year. It had two standout releases in the quarter: NCT 127 2 villains reached #3 on the Billboard 200 albums chart and Aespas Girls: The 2nd Mini Album crowned billboard‘s top album sales chart.
Concert receipts rose to 10.9 billion won from practically nothing a year ago. For the quarter, performance revenue — including television, advertising and events — rose 96.4% to KRW 24.3 billion (US$16.8 million). Licensing revenue rose 76.1% to KRW 26.4 billion (US$18.3 million).
Revenues from SM Entertainment’s subsidiaries rose 119.5% to KRW 136.9 billion (US$94.9 million). These companies include Dream Maker, a Hong Kong-based concert booking agency; SM Culture & Contents, a content production and advertising company; and Keyeast, a Korea-based merchandising and licensing company. According to the press release, these subsidiaries benefited from the reopening of domestic and international tours and increased demand for promotional promotions and business-to-business travel.
Several SM Entertainment artists are touring in Q4: NCT 127 has nine dates in Korea, the US, Thailand and Indonesia; Super Junior has six concerts in Indonesia, Hong Kong and Taiwan; and Ryeowook and NCT Dream have six and five concerts in Japan, respectively.
The company’s Q4 release schedule includes new mini-albums by Chen, BoA and Red Velvet, as well as Red Velvet member Seulgi. Red Velvet’s feel my rhythm Album peaked at number 20 on the Billboard Global Excl. US chart in April; It also charted Indonesia Songs (No. 3), Malaysia Songs (No. 5), Phillippines Songs (No. 15), and Taiwan Songs (No. 16). that of the group The ReVe Festival: Finale EP reached number 40 billboard‘s top album sales chart in January 2020.
Shares of SM Entertainment rose 0.5% to KRW 65,800 on Monday. With a fall of just 11.3% in 2022, SM Entertainment’s stock price has outperformed Korean music companies HYBE (down 61.2%) and YG Entertainment (down 26.4%), but lags behind JYP Entertainment ( plus 12.0%) back, home of Twice, Stray Kids and iTZY.
Shares of SM Entertainment rose 19% on September 16 after the company announced it would early terminate a deal with a production company owned by the company’s founder and largest shareholder. Lee Sooman. However, its share price has since fallen 14%.