Korean music company HYBE, which represents K-pop supergroup BTS, lost $1.7 billion in market value in the first hour of stock trading on Wednesday (June 15) after the band announced it was going on hiatus. . On Tuesday, June 14, the seven band members announced that they would be taking a break – via translator – to pursue solo work, which almost instantly caused HYBE’s shares in South Korean trade to plummet by nearly 28%, reports ‘Variety’.
HYBE shares had fallen around 25,000 won on Wednesday morning and continued to decline throughout the day, wiping out $1.7 billion in market capitalization.
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In the first hour of trading, shares jumped slightly from their starting point of 140,000 won to 145,500 won. The company is currently heading for its lowest close since its IPO in 2020.
However, on Wednesday, HYBE released a statement backtracking on the use of the word “pause.” The group had spoken in Korean in their video announcement and the word “hiatus” was used in the English subtitles. “BTS is not taking a break. The members will be focusing more on solo projects at this time,” the statement read.
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Additionally, BTS’s Jung Kook went live on the V Live app and clarified the misunderstandings by saying through a translator that the group will be working on solo projects, but that doesn’t mean they will stop working as a team. . He also reiterated that BTS is not disbanding – as they insisted upon announcement – just taking a new direction in planning, as they will continue to shoot their “Run BTS” web series on the V Live app. .
The clarification came shortly after Jung Kook released a solo single dedicated to the fan group “Army” titled “My You,” reports “Variety.”
In the nine years since their debut, BTS has accounted for 27% of HYBE’s album sales and streams in the United States, additionally making up almost all of the company’s touring revenue. According to HYBE’s 2021 fourth quarter earnings report, BTS led to a 980.5% (year-on-year) increase in concert sales, earning the company about 49.7 billion won ($42,000,000). . The majority of that revenue came from BTS’s “Permission to Dance” concerts in Los Angeles.
In 2021, HYBE acquired Ithaca Holdings from Scooter Braun, which expanded the company from its revenue from BTS and absorbed 45% of the South Korean company’s album sales in the United States.
BTS also recently released their 35-track anthology album “Proof” (Big Hit/Geffen) which is now set to debut with the second biggest sales of the year, after Harry Styles’ “Harry’s House”.