Story · BTS
BTS Concert Success Hurts Hybe's Shares Due to Lower Profit Margins
Despite record Q2 revenue and operating profit driven by BTS' Arirang tour, shares of South Korean K-pop agency Hybe plunged over 16% on Tuesday and Wednesday, wiping $1.96 billion from its market cap. Analysts attributed the sell-off to a miss in profit-margin expectations, as concert revenue—which surged 243% year-on-year—carries lower margins due to higher artist-settlement costs. The market had expected growth to be led by higher-margin merchandise sales. Hybe's operating margin of 11.8% fell short of analyst estimates. Despite the stock drop, brokerages remain positive, citing additional merchandise production, expansion of tours from new groups Cortis and Katseye, and the return of NewJeans following a resolved contract dispute.
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