On February 27 By 3:10 PM KST, HYBE‘s stock price had dropped significantly to 202,000 won, marking a decrease of 15,500 won (7.13%) from the previous trading day. The company struggled to maintain the 200,000 won range as the downward trend persisted throughout the afternoon.
Similarly, other major entertainment companies also experienced declines in their stock prices. JYP Entertainment‘s stock was trading at 74,400 won, down 2,800 won (3.63%), while SM Entertainment‘s stock fell to 78,000 won, a decrease of 2,700 won (3.35%). YG Entertainment also saw a decline, with its stock trading at 40,800 won, down 1,300 won (3.09%).
This downturn in entertainment stock prices can be attributed to securities companies revising down their target stock prices, anticipating a decline in industry valuation due to sluggish album sales growth in the music industry.
Despite HYBE’s announcement the previous day of record-breaking sales and operating profit in the previous year, concerns arose about the overall slowdown in album sales growth within the K-pop industry. While HYBE saw significant success, aided by contributions from BTS members and Seventeen, who pursued solo activities, other companies struggled to meet market expectations.
Securities analysts, such as Lee Ki Hoon from Hana Securities, predicted lower-than-expected operating profits for JYP Entertainment, SM Entertainment, and YG Entertainment in the fourth quarter. Factors such as sluggish album sales, particularly in China, were cited as contributing to these forecasts. Additionally, SM Entertainment noted a decrease in album sales in the fourth quarter, with initial sales of aespa’s latest album showing a significant decline compared to previous releases.
JYP Entertainment faced challenges despite the success of Stray Kids, with disappointing album sales from ITZY’s latest release causing concern. The initial sales of ITZY’s 8th mini-album experienced a notable decrease compared to previous albums, highlighting ongoing challenges in the industry despite individual successes.