Jakarta, CNBC Indonesia - The largest entertainment agency in South Korea, HYBE, has suffered a significant loss of more than US$ 423 million (Rp 6.7 trillion) in market capitalization. This occurred after the company's shares were locked up by 6.97% on Friday (29/11). The share lock-up happened after the girl group NewJeans announced the termination of their contract with the sub-label HYBE, ADOR.

Unraveling the HYBE-NewJeans Saga: Losses and Controversies

Share Lock-up and Its Impact

The share lock-up of HYBE's shares had a profound impact on the company's market capitalization. It led to a substantial decrease in the value of the company, reflecting the uncertainty and turmoil in the entertainment industry. This event raised questions about the stability and future prospects of HYBE. 2: The share lock-up also affected the confidence of investors and stakeholders. It created a sense of unease and doubt among those who had placed their trust in HYBE. The company now faces the challenge of regaining the trust and confidence of the market to ensure its continued growth and success.

The NewJeans-ADOR Dispute

The announcement of NewJeans leaving the agency due to ADOR's alleged contract violation was a significant event. It highlighted the internal disputes and power struggles within HYBE. The members of NewJeans expressed their dissatisfaction and frustration with the situation, stating that they saw no reason to continue with ADOR. 2: This dispute not only affected the members of NewJeans but also had a ripple effect on the entire HYBE ecosystem. It raised concerns about the management and decision-making processes within the company and led to speculation about the future of HYBE and its various sub-labels.

Other HYBE Artists and Their Impact

HYBE is not only home to NewJeans but also to other popular Korean idol groups such as BTS, SEVENTEEN, and LE SSERAFIM. The internal disputes and challenges faced by HYBE have implications for these other groups as well. It raises questions about the stability and future of the entire HYBE entertainment empire. 2: The success of NewJeans as one of the most popular faces of K-Pop has added to the pressure on HYBE. The company now needs to carefully manage its various assets and ensure the continued success of its artists while addressing the internal issues that have arisen.

Financial Performance and Challenges

HYBE's net profit saw a nearly 99% decline year-on-year in the third quarter of 2024. This was attributed to factors such as limited artist resources and activities during the 2024 Olympics, as well as higher costs associated with the launch of the local group KATSEYE in the US. 2: The financial challenges faced by HYBE highlight the need for the company to carefully manage its resources and make strategic decisions to ensure its long-term viability. It also raises questions about the company's ability to adapt to changing market conditions and maintain its competitive edge.