SM Entertainment Co. crossed the symbolic $1 billion revenue line for the first time last year, propelled by stronger results at key subsidiaries and rising income from concerts, merchandise and licensing tied to its artists.
In a regulatory filing Tuesday, the K-pop company said consolidated revenue for 2025 reached about $810 million, up 18.7% from a year earlier. Operating profit more than doubled, climbing 109.6% to roughly $126 million.
Net income jumped to about $245 million, surging more than 43,000% from the prior year, a leap the company attributed to improved operations and comparison effects.
Momentum continued into the final quarter. SM posted revenue of about $220 million, up 16.6% from the same period a year earlier, while operating profit rose 62.2% to around $38 million. The company swung back to a quarterly net profit, reporting approximately $19 million.
SM said growth was driven by expanding tours, artist merchandise and licensing businesses, as well as improved earnings from major affiliates. Operating profit was lifted by higher parent-company sales, a return to black ink at subsidiaries and the consolidation of fan-platform operator DearU.
Alongside the earnings release, management elaborated on its “SM NEXT 3.0” blueprint, which emphasizes sustainability and efficiency over rapid top-line expansion.
Co-Chief Executive Tak Young-jun said the strategy is designed to build a durable structure rather than chase short-term scale. By adopting a multi-creative production system, SM aims to give content divisions more autonomy while making performance outcomes more predictable, he said.
Tak added that the company will pursue new intellectual property and global expansion in tandem, seeking to strengthen growth, profitability and the long-run competitiveness of its roster.
Co-Chief Executive Jang Cheol-hyuk said the international push will rely more heavily on strategic partnerships and a finer segmentation of target markets based on each act’s characteristics, an approach he said should improve both visibility of returns and execution.
For investors, the milestone highlights how K-pop agencies are evolving into diversified entertainment platforms, less dependent on album cycles and increasingly driven by global touring networks, IP monetization and overseas infrastructure.
