SM Entertainment’s Profits Surge 260% on the Back of K-pop and Fan Platforms

South Korea’s SM Entertainment, home to K-pop acts like NCT 127, EXO, Riize, and aespa, has delivered its strongest quarter yet. The company’s Q3 2025 results were powered by blockbuster albums, larger concerts, and rapid growth at fan platform DearU.

Explosive Financial Growth

Operating profit jumped 261.6% year-over-year to 48.2 billion won ($34.8 million). Net income soared more than 1,100% to 44.7 billion won ($32.3 million). Revenue rose 32.8% to 321.6 billion won ($232 million). In particular, million-selling albums fueled this surge, including NCT WISH’s Color, aespa’s Rich Man, and NCT DREAM’s Go Back to the Future. Concert revenue also climbed 37.5% despite fewer shows; however, larger-scale performances across Asia offset the decline in volume. CFO Jeongmin Jang credited the expansion in concert scale as a key driver.

Meanwhile, merchandising and licensing revenue rose 32.8% to 50.3 billion won ($36.3 million). In addition, aespa merchandise and pop-up stores for NCT WISH and Super Junior boosted sales. Subsidiaries also turned profitable. For example, SM Entertainment Japan grew 11.1% on the back of larger concerts, while SM Brand Marketing gained from stronger album and merch sales. DearU, which runs the Bubble fan messaging service, added 22.3 billion won in revenue. Growth came from new subscribers and a mid-year price hike; therefore, the platform has become a vital earnings driver.

Investing in Next-Generation IP

Looking ahead, CEO Cheol-hyuk Jang highlighted the company’s long-term strategy. SMTR25, a next-generation artist incubation project, is central to that vision. Upcoming projects include Reply High School, a trainee-focused reality series set for 2026, and W.O.W! (Way Outta Walls), a hybrid travel show launched in September with support from the Korea Tourism Organization. As a result, SM is reinforcing its content-driven storytelling approach and strengthening fan connections even before debut.

In summary, SM Entertainment’s record-breaking quarter shows the global power of K-pop and the company’s ability to balance tradition with innovation. With strong financials, expanding fan platforms, and bold new projects, SM is positioning itself as more than a music label. Instead, it is building a cultural powerhouse that shapes the future of entertainment.