Hive Q3 earnings conference call summarized

📮 [Meritz Securities Entertainment Kim Min-young]

🗒️ Hive Q3 earnings conference call summarized

▶️ Details of performance
Revenues of KRW 527.8 billion (-1.9% YoY, -17.6% QoQ) and operating profit of KRW 54.2 billion (-25.4% YoY, +6.4% QoQ) are in line with consensus

▶️ Key content of each artist
- BTS: Jin will be actively engaged in entertainment, broadcasting, pictorials, and commercials after being discharged from the military in June. Full Super Tuna will be released in October, his first solo album will be released on November 15, and his fan showcase will be held. J-Hope will be discharged from the military in October. The rest of BTS members will be discharged from the military in June next year
- SEVENTEEN: The comeback of the 12th mini album in October. On the day of its release, the album sold 3.16 million copies in the beginning, recording the triple million seller record. "SEVENTEEN Street" was held to commemorate the comeback, and the event in collaboration with Airbnb attracted 40,000 people on the website for reservation. The event will continue through early 25 years of its large-scale tour in Korea, the U.S., Japan, the Philippines and Singapore. Japan is collaborating with The City Project
- TOMORROW X TOGETHER: 11/4 comeback, release of YEONJUN's solo album in Q3. Revealing the official character Polbatu, produced by the members themselves participating in the planning. Larger-than-expected sales
- ENHYPEN: It sold 2.34 million copies in its second full-length album in July, an increase of +25% compared to its previous album. Repackaged album released in November and third world tour starting with domestic stadium tour in October
- Le Seraphim: August Mini 4th comeback. Entered Billboard Hot 100 for 2 consecutive weeks. Gold certification from Japan Records Association, with more than 100,000 local shipments of 1st, 3rd, and 4th mini albums. Scheduled to be released in Japan on December 11th. Official character who participated in the planning, Pims Club will be released and special pop-up will be held
- NEWJINS: Bunny's camp in June. Steady popularity on various music charts, ads in Q3
- Boy Next Door: Initial sales of 760,000 copies in its third mini album. Good momentum continued in Korea, the U.S. and Japan. Cumulative sales in Korea reached 1 million. Expectations are high for next activity as new fans are actively entering the market. The first world tour will be held in December
- EYELIT: Comeback of the 2nd mini album in October. Showing Japan's growing album power, including No. 2 in Oricon weekly album rankings. Cumulative sales surpassed 1 million in seven months after debuting
- Cats-I: Spotify listeners are distributed in various countries including the U.S., Southeast Asia, Japan, and South America. Among them, the U.S. listeners account for the highest percentage. They have been on Billboard's Pop Airplay chart for two consecutive weeks. They appear on Netflix documentaries and live broadcasts right after the album's release. They will carry out promotional tours in the U.S. and Asia, and continue various activities until the end of the year
- Hive America (QC Music, BLMG): Ariana Grande stars in Wicked, releases OST LP. Lil Baby topped the UK charts with collaborative songs, announces JT's first solo project, and is on tour in 20 cities. BLMG artists are also active. Artists under Hive America will continue their various activities in the fourth quarter
Hive Latin America is securing a lineup by recruiting Latin artists. Preparing to debut in a localization band

▶️ Weverse Comments
- Weverse DM: opening various labels and artists in Weverse as well as Hive. Antim, Eyelet, CatsEye, TXT open, expect to expand the use of domestic artists in the future
- Early this year, the company introduced in-platform ads and operated them as a trial. It plans to expand the transmission of external ads within the platform. In September, external ads will be sent to the main home screen. Samsung Galaxy ads will be sent to the app's launch screen. Video ads will also be applied to live broadcasting and VOD in the fourth quarter
- Subscription Membership Service Launched In Q4. 2025 Will Be a Time for Revenue to Improve With New Digital BM
- Weverse KPI: MAU recorded an average of 9.7 million people in the third quarter. ARPPU and payment amount decreased slightly by waiting for the previous quarter as artist activity decreased during the third quarter, but the introduction of a new service Weverse in the fourth quarter is expected to increase the number of users and payment amount. Weverse's profitability will also continue to improve in the future through the introduction of an advertising model

▶️ Financial performance
- Sales in the third quarter reached 527.8 billion won. Among them, direct participation sales, such as music studios, performances, advertisements, and appearances, amounted to 323 billion won, accounting for 61% of total sales. Sales of MD/licensing/content/fan clubs amounted to 204.9 billion won, accounting for 39% of total sales
- In the third quarter, even though there were not many releases of Hive artists' albums due to the Olympics, the fandom power grew, and indirect participatory sales rose sharply compared to the previous year
-Operating profit in the third quarter was 54.2 billion won and operating profit margin was 10.3%. Net profit was recorded at 1.4 billion won reflecting non-operating losses. Valuation loss due to shares of other companies and profit and loss from foreign currency conversion due to falling dollar exchange rate are significant
- [Record source] KRW 214.9 billion (-18.8% YoY, -14.0% QoQ)
Even though the album was released to avoid the Olympics, ENHYPEN and Bonec also maintained solid performance due to album growth and BTS Jimin Leceraphim's music performance. Cats Eye music performance contributes to sales
- [Performance] 74 billion won (-14.8% YoY, -48.6% QoQ)
TXT is one of Japan's top four domed tours in the shortest period of time. It contributes to the sales of performances by holding fan meetings such as ANTIM, Leceraphim, and SEVENTEEN. In the fourth quarter, there will be overall growth in direct participation sales due to increased artist activities
- [MD/Content] KRW 99.1 billion (+15.7% YoY), KRW 79.8 billion (+63.6% YoY)
TXT's Polbatu MD pop-up is popular around the world, and tour MDs, including light sticks, contribute to sales. Contents are Cats Eye Netflix documentary and Seventeen Stadium concert movie release contribute to sales
Comment for 2025
- When various projects that have been invested over the years begin to show results in earnest. Expectations are high on the performance of projects that encompass musical diversity, solution business, platform, game, AI, etc. established through the multi-label strategy

▶️ Q&A
Q. Description of Weverse Membership Service?
A. A service that can be selectively used by artists who want improved functions such as offline storage of VOD and video advertisement removal. Additional functions such as video subtitles will also be updated continuously in the future. In order to provide all users with improved and comfortable platform options, we will be open to all Weverse artists. All functions of Weverse can be used free of charge without having to subscribe to a membership