HYBE, the Korea-headquartered powerhouse behind BTS, SEVENTEEN and other global stars, recently reported record annual revenues of KRW 2.2545 trillion (US $1.65bn) for 2024, representing a near-4% YoY increase.
The company confirmed on its latest earnings call that its artists generated 5.2 billion streams globally on Spotify in 2024, capturing a 3.5% share of all streams within the platform’s Global 200 chart.
(Presumably, those 5.2 billion streams included music from girl group NewJeans. Over the past fortnight, headline-grabbing legal drama between NewJeans and HYBE subsidiary ADOR has reached a crescendo – with the band, forced by court order to remain signed to ADOR, announcing a sudden hiatus.)
Despite posting its highest-ever annual revenue in 2024, HYBE’s annual operating profit declined 38% YoY in the year to KRW 184.8 billion ($138m), as its operating margin fell to 8.2%.
HYBE’s CEO Jason Jaesang Lee and CFO Kyung-Jun Lee commented extensively on the firm’s financial results and strategic outlook during its Q4 earnings call on February 25.
Here are five key insights from their presentation:
1. HYBE’s concert business reached all-time highs in 2024, more than doubling year-over-year
HYBE’s artists held an impressive 172 concerts and fan meetings in 2024, with concerts revenue up by 25.6% YoY on an annual basis, and up by a whopping 111% YoY in Q4 2024.
The company said major tours by SEVENTEEN, ENHYPEN, and Tomorrow X Together (TXT) fueled this growth, with SEVENTEEN alone attracting more than 1 million ticket purchases throughout its Follow and Right Here tours.
According to Lee, SEVENTEEN, ENHYPEN, and TXT claimed the top three spots on Billboard‘s K-Pop Concert sales chart for 2024.
“SEVENTEEN held an encore show of the Follow Tour that started in 2023 and went on to the Right Here tour starting in October in Goyang that included 34 shows in 15 cities, selling more than 1 million tickets,” Jaesang Lee explained. “Tomorrow X Together entertained approximately 540,000 people through 33 shows in 17 cities. ENHYPEN attracted around 460,000 fans to 35 shows in 16 cities.”
HYBE plans to continue this momentum in 2025, with BTS member J-Hope recently kicking off his solo tour, which will include shows in North America, Central America, and Japan.
SEVENTEEN, TXT, and ENHYPEN are also preparing for new album releases and world tours, while LE SSERAFIM is scheduled for a world tour after holding their first tour in 2023.
Lee noted that HYBE’s concert geography would expand beyond Korea, the U.S., and Japan in 2025 to include more shows in Europe and Latin America.
2. HYBE’s US and Latin American operations pulled down the bottom line in 2024 – but the firm is optimistic these investments will pay off long-term
Why did HYBE’s operating profit margin drop to 8.2% in 2024, vs. the double-digit levels we saw in the prior year?
The firm’s CFO, Kyung-Jun Lee, pointed to international expansion costs as a primary factor behind this decline.
“In [the] music business, our revenue mix by artists has changed with the absence of BTS and the debut of new groups,” he said.
“Furthermore, investments related to the debut of KATSEYE in the US, [plus] lack of activities by artists under the management of HYBE America, and expenses to establish human resources and infrastructure for HYBE Latin America, pulled down the bottom line,” Lee explained.
HYBE recorded a net loss of KRW 26 billion in Q4, “mainly due to the loss impairment recognition as goodwill of Ithaca Holdings as a non-operating loss,” said Lee.
HYBE acquired Ithaca Holdings, founded by Scooter Braun, in 2021. The firm then became the bedrock of HYBE America, with Braun as its CEO.
“investments related to the debut of KATSEYE in the US, [plus] lack of activities by artists under the management of HYBE America, and expenses to establish human resources and infrastructure for HYBE Latin America, pulled down the bottom line.”
Kyung-Jun Lee, CFO, HYBE on 2024’s performance
HYBE CEO, Jaesang Lee, further acknowledged the financial impact of international investments on the company in 2024, but also emphasized their long-term strategic value.
Lee said on the Q4 earnings call that HYBE’s investment into the US had helped drive “significant growth in [our] labels business as well as new businesses”.
He commented that while these investments may not show immediate financial returns, they provide “intangible benefits”, of which HYBE’s US operation is “already feeling the impact and positive effect[s]”.
“Unfortunately, these are not shown in the short-term earnings numbers, but [they] are very valuable,” Lee added. “Just like developing a new K-pop group takes a lot of investment, [investing in HYBE America] will later lead to revenue contribution and earnings contribution in the long term.”
Lee cited KATSEYE’s successful debut in partnership with Geffen Records as a recent example, as well as HYBE America’s ability to secure top talent like producer Ryan Tedder for future projects.
CFO, Kyung-Jun Lee, expressed optimism that global margins would improve in 2025, driven by “the comeback of BTS, economies of scale from the growth of HYBE Music Group artists, enhanced artist management capabilities with Cade Hudson, and revenue contribution from HYBE Latin America”.
Who’s Cade Hudson? A former CAA agent who, HYBE has confirmed, has been hired by Braun to help lead HYBE America’s management arm, SB Projects.
Hudson has previously represented acts including Britney Spears, Usher, Justin Timberlake, Lady Gaga, and Selena Gomez.
3. BTS’s comeback is expected to boost HYBE’s margins in 2025
While HYBE has built a diversified portfolio of successful artists, BTS remains central to the company’s identity and financial performance.
As the group’s members complete their mandatory military service and prepare to resume full activities in 2025, investors are keen to understand how this will impact HYBE’s financials.
When asked about BTS’s revenue contribution, HYBE CEO, Jaesang Lee, acknowledged that while the group was once responsible for approximately 95% of HYBE’s revenue, that percentage has declined “to slightly below 20% as of 2024″ while members have been serving in the military.
“the BTS members will finish their military service, and will make a comeback and resume concerts and other activities.”
Jaesang Lee, HYBE
As mentioned earlier, HYBE CFO Kyung-Jun Lee indicated that HYBE expects its margin to improve in 2025, driven by factors including “the comeback of BTS”.
Jaesang Lee said HYBE expects that BTS will “finish their military service, make a comeback, and resume concerts and other activities”.
Despite their reduced activity in 2024, BTS members still made individual chart impacts. “Solo tracks by BTS Jin, Jimin, V, and Jungkook – and Neva Play by Megan Thee Stallion featuring RM – all entered the Billboard Hot 100,” Lee noted.
The CEO emphasized that regardless of their revenue contribution, “BTS has a lot of symbolic significance for HYBE because BTS was there from the very beginning of this company… we believe that BTS is a representative artist group for HYBE.”
4. HYBE sees KATSEYE’s US success as validation of its K-pop system in Western markets
After years of development, HYBE launched the girl group KATSEYE in the US last year through its partnership with Universal Music Group‘s Geffen Records.
According to HYBE CEO Lee, the group “had the best year in 2024 with their debut album SIS,” with their title track Touch appearing on the Billboard Bubbling Under Hot 100 for two weeks and the Global Song Chart for 13 consecutive weeks.
“The group has received so much attention and affection from listeners and music critics worldwide. The success of KATSEYE demonstrate[s] that the K-pop system can work in the U.S.,” Lee stated.
Building on this achievement, HYBE plans to launch a new boy group project in the US working with Ryan Tedder, “a multi-platinum producer who won four Grammy Awards and worked with global artists, including Beyoncé, Adele and Ed Sheeran”.
Lee framed these efforts as part of HYBE’s goal of “driving innovation in our industry by applying the K-pop system and know-how to other genres.”
The company is pursuing a similar strategy in Latin America, where it established HYBE Latin America in November 2023 and is “currently developing a strategy that is tailored for the local culture and fandom attracting music.”
5. HYBE is diversifying its business with gaming, AI, and digital fan platforms
Beyond its core music business, HYBE is investing heavily in technology-based growth areas including gaming, AI, and its digital fan platform Weverse.
According to Jaesang Lee, the company’s gaming division, HYBE IM, “started the game publishing business in full swing in 2024 and became a comprehensive game company with both in-house development and external publishing capabilities”.
HYBE’s gaming division received approximately KRW 110 billion ($82 million) in funding from investors including Makers Funds and IMM Investment last year, he said.
HYBE IM is developing both in-house games using artist IPs and publishing external titles. Its mobile puzzle game Puzzle SEVENTEEN opened for early registration on the day of the earnings call, with other in-house titles planned for sequential release.
In the AI space, HYBE’s Supertone launched multiple products in 2024, including Supertone Shift, a real-time voice changing technology that has attracted around 350,000 users, plus Supertone Play, a text-to-speech technology that can create 150 different voices in three languages.
Lee noted that Supertone’s CEO Kyogu Lee was “the first Korean to be named in the Time 100 AI 2024 list.”
Weverse, HYBE’s global fan platform, launched its Digital Membership subscription service in December 2024, offering features – for an additional fee – like real-time translation in 18 languages, plus offline saving options, AI-powered video quality enhancement, and exclusive benefits for subscribers.
According to HYBE’s CFO, Kyung-Jun Lee, while the Digital Membership service is “in the beginning stage,” its profits “are expected to increase gradually,” with revenue recognition starting from January 2025 following a month’s free trial for users.
When asked about potential synergies between HYBE’s music and gaming businesses, CEO Lee explained: “I’d like to approach this topic not in terms of the synergies between games and music, but synergies between tech and music.
“There are changing patterns of music consumption and content consumption. As consumption patterns change, I believe that there will be more synergies between technology and music.”
He added that HYBE had considered developing “meta artists” in 2022 – i.e. AI-generated character artists – but dropped the idea because “the market was not ready”.
However, the company remains prepared to respond “when that time comes”.
CFO Kyung-Jun Lee summarized HYBE’s outlook, stating: “2025 will be a year when various businesses that we have been investing in for several years will start to produce tangible results.
“We expect good results from our diversified music portfolio that we have been building through the multi-label strategy, our solutions business designed to offer new and unique entertainment to fans as well as [our] platform, game, and AI business.”Music Business Worldwide
