HYBE (352820) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached KRW 640.5 billion, up 3.1% year-over-year and marking the highest quarterly revenue in company history, driven by strong artist activities and global expansion.

• Operating profit for Q2 was KRW 50.9 billion, down 37.4% year-over-year but up 253.9% from Q1, with net profit at KRW 16.5 billion, a decrease of 85.9% year-over-year.

• HYBE artists sold over 15 million albums in H1 2024, accounting for 34% of Korea's total, despite a declining market and BTS's absence.

• The company is executing a multi-label, multi-genre strategy, expanding globally with new subsidiaries and acquisitions in Latin America and the US.

• Major global achievements include multiple Billboard chart entries, successful world tours, and strong streaming performance.

Financial highlights

• Q2 2024 consolidated revenue: KRW 640.5 billion (+3% YoY), highest ever; H1 2024 revenue: KRW 1,001.4 billion, down from KRW 1,031.6 billion in H1 2023.

• Operating profit: KRW 50.9 billion in Q2; H1 2024 operating income: KRW 65.3 billion, down from KRW 133.9 billion in H1 2023.

• Gross margin for Q2 was 27.2%, and for H1 2024 was 42.3%, both lower than the previous year.

• Total assets as of June 2024 were KRW 5,140.7 billion, with total equity at KRW 3,234.5 billion.

• Cash and cash equivalents at June 30, 2024, were KRW 321.5 billion, down from KRW 357.9 billion at year-end 2023.

Outlook and guidance

• Expectation of larger top-line growth and improved margins in H2 2024 as new businesses mature and BTS returns in 2025.

• Weverse subscription service to launch in Q4, with further monetization and user growth anticipated.

• Continued global expansion, debut of new artists, and investment in technology and platforms, including AI and fan community services.