[Click eStock] "DearU, Subscription Growth Continues with New Lineup Expansion"

On the 26th, Korea Investment & Securities analyzed that DearU should be noted for its continuous increase in subscriptions due to the benefits from K-pop growth and the expansion of new lineups.

Andoyoung Ahn, a researcher at Korea Investment & Securities, stated in a report on the same day, “DearU, which holds major IPs such as SM and JYP, strengthened its domestic lineup by acquiring NCSoft’s fandom platform Universe in January,” adding, “In February, Starship’s IVE, Monsta X, and IST’s The Boyz joined the platform, and in April, Cube Entertainment’s (G)I-DLE and BTOB also joined.”

With the expansion of existing artists’ fandoms and the acquisition of Universe’s IPs, the number of subscriptions in the first quarter increased by 400,000 in just one quarter, reaching 2.05 million. The second quarter is also expected to see growth from existing IPs along with the fandom influx effect from Cube Entertainment.

Researcher Ahn said, “Additional growth is expected through securing overseas IPs,” and added, “In Japan, which is expected to be the first market to enter, a joint venture with the fan platform operator m-up Holdings will be established to launch the ‘bubble for Japan’ service.” The expected launch is in the fourth quarter of this year, with DearU’s anticipated stake in the JV at 44%, recognizing royalty revenue and equity-method income rather than consolidated sales.

He analyzed, “m-up already has over 2 million paid subscribers and more than 300 IPs, so a steep increase in subscriptions is expected after the service launch,” and “Lineups in China and the United States are also planned to be expanded thereafter.”

Furthermore, he explained, “After the acquisition of Universe, concerns about IP departure arose due to misunderstandings regarding SM’s entry into other platforms and JYP’s news about building its own platform, which caused the stock price to underperform,” but clarified, “The former was collaboration in terms of fan clubs and MD, not Bubble’s private messaging, and the latter was about strengthening its own platform for MD sales.”

He emphasized, “The two entertainment companies, which are the company’s largest revenue sources, and Kakao Entertainment, which joined in February, are linked to DearU through equity relationships, so concerns about their departure are minimal,” and added, “Rather, attention should be paid to the increase in subscriptions due to the growth of existing major IPs such as NCT and Stray Kids and the expansion of lineups.”

He added, “Along with the increase in subscriptions, in the third quarter, paid items such as handwritten fonts and emoticons will be added, and the fan club function, currently used only by one team (Stray Kids), is expected to be expanded, leading to an increase in ARPU.”

This content was produced with the assistance of AI translation services.