SM Entertainment reported its strongest fourth-quarter performance in history, posting consolidated revenue of KRW 319 billion for Q4 2025, up 16.6% year-on-year. Operating profit jumped 62.2% to KRW 54.6 billion, while net income turned positive at KRW 27.4 billion, compared to a loss in the same period last year. Operating margin expanded to 17.1%, a 4.8 percentage point improvement from Q4 2024.
On a standalone basis, the company’s revenue rose 12.1% to KRW 202.2 billion, with operating profit increasing 10.2% to KRW 39.5 billion. Net income more than doubled, rising 106.5% to KRW 29.3 billion, supported by improved core business performance.
Global Touring and IP Monetization Drive Growth
SM’s record quarter was fueled by strong performance in live events and intellectual property (IP) monetization. Tours and concerts by NCT DREAM, aespa, RIIZE, and NCT WISH expanded international reach, while artist-driven merchandising and licensing also contributed to revenue growth.
Subsidiary performance improvements, particularly at SM C&C and SM Japan, along with the consolidation of DearU, further bolstered consolidated earnings.
Strategic Growth Under “SM NEXT 3.0”
The company highlighted progress under SM NEXT 3.0, its long-term strategic framework aimed at sustainable, scalable growth.
“SM NEXT 3.0 is focused on strengthening the foundation of our growth rather than pursuing short-term expansion,” said Co-CEO Daniel Jang. “Through our Multi-Creative system, we are enhancing production autonomy and operational efficiency, enabling greater consistency and scalability across IP development. By advancing new IP incubation alongside disciplined global expansion, we aim to drive revenue growth, improve profitability, and enhance long-term shareholder value.”
Co-CEO Dmitry YJ Tak added, “Our global expansion strategy emphasizes sustainability, operational discipline, and strategic partnerships. By adopting a more focused, IP-specific regional approach aligned with market dynamics, we expect to enhance performance visibility while improving operational efficiency and execution across markets.”
Outlook for 2026
Looking ahead, SM anticipates continued growth in recorded music, digital distribution, and live performances. Upcoming releases include full-length albums from EXO and Irene in Q1, and from TAEYONG, aespa, and NCT WISH in Q2, alongside mini-albums from RIIZE and Hearts2Hearts and a single from RYEOWOOK.
The live concert segment is also expected to maintain momentum. SUPER JUNIOR will continue its 20th anniversary tour in Q1, joined by NCT DREAM, aespa, RIIZE, NCT WISH, and TAEYONG across Asia. In Q2, EXO will embark on its tour, TVXQ! will perform at Nissan Stadium, and Hearts2Hearts will hold its first U.S. showcases.
SM Entertainment’s Q4 2025 performance underscores the company’s ability to scale its IP-driven business model globally while enhancing profitability, positioning it for sustained growth in 2026.