CJ ENM Reports Operating Loss of 30.4 Billion KRW in 2Q... Two Consecutive Quarters of Deficit

Q2 Sales 1.0489 Trillion KRW, Operating Loss 30.4 Billion KRW
Two Consecutive Quarters of Loss Following Q1
Sales Down 12% Year-on-Year, Turned to Loss

CJ ENM announced its Q2 earnings on the 10th. Revenue was 1.0489 trillion KRW, with an operating loss of 30.4 billion KRW. Following an operating loss of 50.3 billion KRW in Q1, this marks two consecutive quarters of losses. Revenue in Q2 last year was 1.1192 trillion KRW, with an operating profit of 55.6 billion KRW. Revenue fell by 12% compared to one year ago. In Q2 2022, revenue was 1.1925 trillion KRW, with an operating profit of 55.6 billion KRW. ENM operates in four major business sectors: media platform, film and drama, music, and commerce. The media platform and film and drama sectors turned to losses compared to the same period last year.

In Q2, media sector revenue was 342.8 billion KRW, down 11.6% year-on-year. It recorded an operating loss of 29.9 billion KRW, turning to a deficit. Due to economic uncertainty, the broadcast advertising market slowed, with TV advertising revenue decreasing by 30.2% and digital advertising revenue also falling by 27.8% compared to one year ago. However, OTT (online video service) TVING’s subscriber base increased by 69.2% year-on-year, providing some consolation.

The film and drama sector posted revenue of 229.6 billion KRW and an operating loss of 31.1 billion KRW. Revenue decreased by 32.2% compared to the same period last year, turning to a loss. This sector, along with the media platform, recorded losses. While the 'Fifth Season' series contributed to revenue, losses continued due to delays in producing key works such as documentaries.

The music sector recorded revenue of 130.8 billion KRW and an operating profit of 12 million KRW. Revenue increased by 14.2% year-on-year, while operating profit decreased by 1.1%. This was the best-performing sector among ENM’s four main business areas. The release of single albums by JO1 and INI, as well as Kep1er, drove revenue growth. Convention live revenues, including 'KCON Japan 2023' which recorded a record audience of 123,000, and concerts by Lim Young-woong and (G)I-DLE, increased by 29.9% compared to the same period last year.

The commerce sector posted revenue of 345.7 billion KRW and an operating profit of 18.7 billion KRW. These figures represent decreases of 1.7% and 4.2%, respectively, compared to the same period last year. Strengthening portfolio composition leading consumer trends in fashion, travel, and rental resulted in high growth in TV handling volume and mobile live commerce. Along with the music sector, it was one of the two pillars that reduced ENM’s deficit.

Subsidiary Studio Dragon recorded revenue of 163.5 billion KRW and an operating profit of 16.3 billion KRW. Revenue increased by 3.8% year-on-year, but operating profit fell by 39.8%. In the second half of the year, ENM plans to focus on improving scale and profitability through ▲ strengthening synergy between TV channels and TVING in the media platform sector to recover TV advertising and expand subscribers ▲ enhancing content competitiveness and diversifying distribution platforms in the film and drama sector ▲ nurturing in-house artists and expanding global activities of new groups in the music sector ▲ expanding the results of the one-platform strategy and strengthening competitiveness through MLC advancement in the commerce sector.

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