SM And YG Entertainment Demoted From Top Blue-Chip Companies To Regular Mid-Size Businesses Due To Poor Performance And Increased Losses

[MVSica]

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[ARandomFan]

 

[Seriously]

That's.... a tragedy​

 

[UMJI MOODS]

Who qualify as the big 3 now?
JYP, HYBE and ???​

 

[Ackerman]

Considering most of their profits came from touring, this was expected. SM especially, they have a gigantic roster of artists they need to pay and they haven't been touring.

 

[Pandaa]

meanwhile jyp stiull blue chip thanks to twice (nation girl groyp)

 

[MedicationHelps87]

As expected. A lack of touring hurt a lot of people in the music industry.
Hopefully they can regain what they lost in other ways.

 

[Whisky23]

Considering most of their profits came from touring, this was expected. SM especially, they have a gigantic roster of artists they need to pay and they haven't been touring.

JYPE also earns money from touring, but they're still churning a profit. Idols aren't salaried staff - they earn based on profit sharing, so if they're not touring, they are also not earning. If SM & YG can't stay profitable without touring, then it means that physical and digital sales, CFs and TV appearance fees aren't enough for them to survive (while other agencies are able to do as smaller groups tour less often).

The difference between SM & YG vs JYPE is their high overheads due to their involvement in other business that are also losing money in this COVID era (and in SM's case, their hefty payout to Lee Soo Man through his "consulting company").On the other hand, JYPE has rationalized their business, and even let go of other businesses that are not core to the business (i.e. actors), so their cost structure is lower.