HYBE Shares Fall, SM Entertainment Stock Slips Amid EXO Mediation

The share prices of two K-pop giants, HYBE and SM Entertainment, suffered steep losses in a week in which few music stocks mustered even small gains. 

In the week ended Friday (Sept. 26), HYBE’s stock fell 7.5% to 268,500 KRW ($190.53) amid a broader monthly downturn of approximately 9%. The company’s founder and chairman, Bang Si-hyuk, is currently facing a securities litigation probe. Additionally, on Tuesday (Sept. 23), HYBE sold its stake in YG Entertainment’s YG Plus. 

While HYBE maintains exposure to YG Plus through the 10.2% stake owned by HYBE subsidiary Weverse, the disposal of its 4.8 million shares worth a total of 38.22 billion KRW ($27 million) will help shore up the company’s finances. HYBE’s operating profit rebounded in the second quarter, but in 2024, the company reported that cash flow from operating activities was at its lowest since the COVID-19 pandemic began in 2020. HYBE held 412 billion KRW ($292 billion) in cash and cash equivalents at the end of 2024, an improvement from 2023 but lower than in both 2021 and 2022. 

SM Entertainment fared even worse than HYBE, falling 13.9% to 131,700 KRW ($93.46) after the company’s first court-led mediation with three members of the group EXO failed to resolve a $430,000 contract dispute. The artists claimed last year that they were being overcharged by SM for the distribution of music. 

Despite their recent struggles, the two K-pop companies are among the best-performing music stocks in 2025. Year to date, SM Entertainment is up 81.4% — third-best behind Netease Cloud Music (134.2%) and Tencent Music Entertainment (111.9%) — and HYBE has gained 33.6%. 

The Billboard Global Music Index (BGMI) fell 2.1% to 3,034.75 this week, lowering its year-to-date gain to 40.8%. That marked the first decline in four weeks and just the sixth losing week in the second half of the year. Only two stocks posted gains for the week, while 16 lost value and one was unchanged. 

Global markets were mixed this week as investors weighed the damage that could arise from a possible federal government shutdown in the U.S. The Nasdaq composite index fell 0.7% to 22,484.07 after closing the previous week at an all-time high. The S&P 500 ended a three-week winning streak, closing down 0.3% to 6,643.70. The U.K.’s FTSE 100 rose 0.7%. South Korea’s KOSPI composite index slid 1.7% and China’s Shanghai Composite Index rose 0.2%.

Universal Music Group had the week’s largest gain, rising 2% to 24.00 euros ($28.09). Madison Square Garden Entertainment, which improved 0.3% to $45.29, was the week’s only other music stock in positive territory.

Live Nation fell 1.2% to $161.79, bringing its two-week decline to 6.9%. Live Nation and Ticketmaster were sued by the U.S. Department of Justice on Sept. 18 over allegedly violating the Better Online Ticket Sales (BOTS) Act and engaging in “systemic unfair and deceptive practices,” according to the lawsuit. The stock received good news earlier in the week, however, when Seaport Global increased its price target to $190 from $170 and maintained its “buy” rating. 

Music streaming companies were among the week’s biggest losers. Tencent Music Entertainment fell 5.9%, Anghami slipped 4.8%, Netease Cloud Music dropped 4.4% and Spotify, the BGMI’s most valuable company, dipped 2.5%.

Another streaming company, LiveOne, executed a 10-to-1 reverse stock split on Friday (Sept. 26) that allowed it to meet the Nasdaq exchange’s minimum bid requirement of $1 per share. After accounting for the split, LiveOne’s share price fell 5.5% to $4.82, deepening its year-to-date loss to 65.1%. 

iHeartMedia had the second-largest decline of the week, falling 10.6% to $2.71. Despite the stock suffering its first decline in three weeks, iHeartMedia shares have risen 69.4% over the past seven weeks and have gained 27.2% year-to-date. The stock has been on a roll since its Q2 earnings on Aug. 11 showed that the company beat guidance by posting a small revenue gain.