SM Entertainment (A041510) Q2 2024 earnings summary

Executive summary

• Consolidated sales rose 5.9% year-over-year to KRW 253.9 billion, driven by higher album and concert sales.

• Operating profit fell 30.7% year-over-year to KRW 24.7 billion due to subsidiary deficits and increased content costs.

• Net profit dropped 70.3% year-over-year to KRW 8.4 billion, impacted by higher income tax and subsidiary performance.

Financial highlights

• Gross profit decreased 6.6% year-over-year to KRW 77.7 billion.

• SG&A expenses increased 11.6% year-over-year to KRW 53.0 billion.

• Parent company sales surged 25.4% year-over-year to KRW 174.1 billion, with strong growth in album and concert revenue.

• Parent operating profit rose 4.6% year-over-year to KRW 29.3 billion, but net income declined 22.5% year-over-year to KRW 13.5 billion.

Outlook and guidance

• Upcoming music releases from major artists and new groups are scheduled for 3Q24 and 4Q24.

• Extensive concert tours planned across Asia, Europe, and the Americas in the second half of 2024.