SM Entertainment Posts Record Q4 Revenue as Concert and Merchandise Sales Surge

SM Entertainment has reported record fourth-quarter revenue for 2025, capping a year in which its live touring and merchandise businesses became the company's biggest growth engines. The Seoul-based agency behind Aespa, Exo and NCT Dream disclosed quarterly revenue of 319 billion won (roughly $221 million), up 16.6% from a year earlier.

The company's core operations, excluding subsidiaries, generated 202.2 billion won ($139.9 million), a 12.1% year-over-year increase. Concerts were the standout performer, climbing 53.6% to 34.5 billion won, while merchandise sales jumped 50.6% to 78.1 billion won. SM's artists staged 122 live performances during the quarter, and merchandise revenue was buoyed by strong sales of "official fan-light" light sticks for Aespa and Super Junior, as well as licensing tied to Aespa's collaboration with battle royale game PUBG.

That strength helped offset a 22.8% decline in physical and digital music sales, which totaled 64.8 billion won, as SM released fewer albums during the period. Even so, physical album sales remained sizable, with 2.72 million units sold, including 1.02 million copies of NCT Dream's "Beat It Up" and 710,000 copies of Riize's "Fame." Appearance and event fees added another 24.1 billion won, up 12.3% year over year.

Net income for the core business more than doubled to 29.3 billion won, up 106.5% from the prior year, while consolidated net income reached 27.4 billion won. Including major subsidiaries, total quarterly revenue rose 23.8% to 169.1 billion won, with concert-focused unit Dream Maker posting a 228.8% surge to 16.5 billion won and SM Japan growing 27.1% to 25.7 billion won.

Speaking on the earnings call, co-CEOs Dmitry YJ Tak and Daniel Jang framed the results as validation of the company's "SM Next 3.0" strategy, which Tak said is aimed at building "a sustainable growth structure" rather than chasing short-term scale. Jang added that the company's "Multi-Creative" production system is designed to improve efficiency and consistency across its roster's intellectual property.

Following the announcement, SM shares rose roughly 5% to top 120,000 won (about $83), though the stock remains down nearly 10% since the start of 2026. It is up 28% compared with mid-February 2025, reflecting investor confidence in the agency's live-business pivot even as album sales cool industry-wide.