YG Swings to Deficit in Q1

연합뉴스 / 2024-05-10 11:33:20

▲ An undated file photo of YG Entertainment's CI. (Yonhap)

SEOUL, May 10 (Yonhap) -- YG Entertainment reported a deficit in the first quarter of this year, recording an operating loss of 7 billion won.

This operating loss, reported by the K-pop behemoth on the 10th, significantly differed from market expectations as shown in Yonhap Infomax's earlier forecast (operating profit of 7.1 billion won).

Revenue decreased by 44.5% year-on-year to 87.3 billion won. Net profit plummeted by 98.7% to 42 million won.

YG explained that this loss was due to increased expenses related to investments in new intellectual property (IP), including the recently debuted girl group BABYMONSTER and other rookie artists preparing for launch.

Additionally, the company cited the performance decline of YG Plus, its subsidiary responsible for album distribution, due to global economic slowdown and increased market volatility, as well as investment losses in YG Investment.

"Initial investments in new talents may pose short-term cost burdens, but they are integral to our future growth strategy," YG emphasized, noting that the current performance includes costs related to new content development and marketing.

Furthermore, YG expressed its commitment to enhancing the company's competitiveness and fostering growth in various markets in the long term.

YG aims to kickstart a project to nurture and debut at least one new rookie group by the end of the year. Additionally, they plan to collaborate with local entertainment companies like Japan's Avex to host global auditions.

BABYMONSTER, which officially debuted last month, set a new record for first-week sales of a debut album by a K-pop rookie girl group, selling over 400,000 copies of their first mini-album within a week.