Why K-pop agencies thrive despite slower album sales
Stray Kids perform in front of some 45,000 fans during their concert in Lima, Peru, in April. Courtesy of JYP Entertainment
HYBE, SM, and YG report strong Q1 earnings on surge in concert revenue
K-pop agencies are seeing a resurgence, even as physical album sales decline from their pandemic-era peak.
Fueled by soaring concert revenues and the global popularity of new acts, Korea’s leading entertainment companies are posting stronger-than-expected earnings in early 2025.
According to the music industry on Sunday, three of the “big four” agencies — HYBE, SM Entertainment and YG Entertainment — reported improved first-quarter results compared to the previous year. JYP Entertainment has not yet released its figures but is projected to show a year-on-year decline.
HYBE recorded 500.6 billion won ($368 million) in revenue and 21.6 billion won in operating profit for the first quarter of 2025, up 38.7 percent and 50 percent, respectively, from a year earlier. This marks a sharp turnaround from the same period last year, when both revenue and profit fell.
SM Entertainment also saw growth, posting 231.4 billion won in revenue, up 5.2 percent, and 32.6 billion won in operating profit, a 110 percent jump.
YG Entertainment, which was in the red during the first quarter last year, returned to profitability with 9.5 billion won in operating profit and 100.2 billion won in revenue, a 14.7 percent increase.
The agencies’ improved performance is largely driven by live concerts and artist-related merchandise sales. HYBE’s concert revenue, which stood at 25.2 billion won in the first quarter of 2022, jumped to 44 billion won in 2023 and skyrocketed to 155.1 billion won this year, surpassing its album and digital music sales of 136.5 billion won.
That marks a stunning 615 percent growth over two years. SM also reported a 58 percent increase in concert revenue year-on-year, compared to 23.1 percent growth in album and digital music sales.
Girl group 2NE1 wraps up their world tour with an encore concert in Seoul in April. Courtesy of YG Entertainment
Global tour boom
World tours have played a key role. At HYBE, Seventeen wrapped up a U.S. tour and began an Asia tour in the first quarter, while BTS member J-Hope’s solo tour, which started in February, is expected to attract 450,000 fans across 33 shows in 15 cities.
Tomorrow X Together (TXT) continued their global tour, completing a European leg during the quarter. SM artists, including aespa, TVXQ and NCT 127, also contributed to the improved earnings with their international tours.
Industry insiders say the decline in album sales reflects a market correction after the pandemic, when fans bought albums in bulk to support artists amid limited live events. Now that tours have resumed, agencies are shifting their focus away from physical albums.
“A lot of artists are releasing mini-albums or singles instead of full-length albums due to shorter promotional cycles and intensified competition,” an official at a major K-pop agency said. “Fans are prioritizing concert experiences over album ownership, and international demand for live shows continues to grow. Concerts are likely to account for an even greater share of agency revenues moving forward.”
Kim Do-heon, a pop music critic, said K-pop’s concert market will only see sustainable growth if companies focus on quality content.
“Instead of boosting ticket sales with expensive packages or limited-edition merchandise, the key is to offer performances that leave a lasting impression on audiences,” he said.
BTS member J-Hope in Mexico / Captured from J-Hope's Instagram
This article from the Hankook Ilbo, the sister publication of The Korea Times, is translated by a generative AI and edited by The Korea Times.