JYP posts surprise earnings led by Stray Kids; rookie success is the next challenge

[Financial News] Daol Investment & Securities said on the 12th that JYP Entertainment posted results above market expectations in the third quarter of this year, driven by strong album sales and overseas activities by Stray Kids. It maintained its investment rating of “Buy” and its target price of 55,000 won.
Lim Do-young, an analyst at Daol Investment & Securities, said, “Stray Kids continues to deliver results above expectations,” adding, “If the new boy group debuting next January gets off to a strong start, concerns over the military-service hiatus could ease, and the company’s value could also be reassessed.”
JYP’s third-quarter revenue was 267.5 billion won, and operating profit was 48 billion won, up 15.0% and 17.6%, respectively, from the same period last year. Analyst Lim said, “Album sales by Stray Kids in Western markets and revenue from its appearances at festivals in Latin America drove the strong results.”
Album and digital music revenue totaled 99 billion won, with album sales alone generating 79.2 billion won. Concert revenue came to 45.6 billion won, down 31% due to the base effect of last year’s large-scale tour. By contrast, revenue from festival appearances rose 138%, buoyed by the success of festivals in Latin America. Merchandise (MD) revenue reached 58.6 billion won on strong sales of fan-meeting and concert merchandise.
The key question going forward is whether the rookie boy group Of The Blue will succeed. Analyst Lim said, “The assumption is that Stray Kids members will enlist one after another starting with Lee Know in the first quarter of next year, though they could also enlist together,” adding, “The early performance of the group debuting next January will be important.” Lim added, “Debuts and comebacks by boy groups from major agencies will be concentrated in the first half of next year, drawing greater interest from K-pop fandoms.”

[email protected] Choi Doo-seon Reporter