Challenges such as internal power struggles at HYBE, BTS’s Suga’s recent DUI incident, and personal issues involving the company’s leadership have led to a decline in HYBE’s stock, although there was a brief recovery.
Nonetheless, the stock price took another hit when NewJeans publicly voiced their dissatisfaction with HYBE, further eroding investor confidence.
On September 13th, HYBE’s stock dropped by 2.96%, continuing a downward trend that started after NewJeans urged ADOR’s management to revert to its original structure under Min Hee-jin by September 25th.
The tensions between HYBE and Min, which commenced in April, appeared to conclude with her removal as CEO in August. However, NewJeans’ recent remarks have rekindled uncertainty, resulting in further stock declines.
Despite the widespread appeal of K-pop, HYBE and other entertainment stocks have faced difficulties this year, with HYBE’s stock decreasing by 29.6%. Similar downturns have been observed for JYP, SM, and YG Entertainment. This underperformance has been attributed to diminishing profits, even in the face of robust album sales.
Critics contend that the revenue model of K-pop, which heavily depends on album sales and fan-oriented purchases of physical merchandise, faces inherent limitations. The slowdown in album sales this year has further impacted the financial health of major entertainment companies. However, analysts believe that stock prices may recover in late 2024, driven by potential catalysts such as new artist debuts and enhanced monetization strategies for HYBE’s fan platform, Weverse.
Source: Daum
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