Intensifying Competition in Shareholder Returns as Entertainment Companies Strengthen Dividend Policies

Major domestic entertainment companies are enhancing their shareholder return policies to boost shareholder value. An increasing number of firms are actively utilizing dividends despite poor financial performance, signaling a new trend in the industry.

HYBE recently decided to introduce the first minimum dividend system among K-content companies, guaranteeing at least 500 won per share. The company previously established a medium-to-long-term shareholder return policy aiming to allocate up to 30% of its consolidated net profit to shareholder returns each year. For the 2024 fiscal year, it paid a cash dividend of 200 won per share ( totaling 8.3 billion won ).

A new three-year shareholder return strategy has also been formulated. Specifically, the company plans to shift the dividend calculation basis from net profit to consolidated free cash flow (FCF), which reflects actual cash generation capacity. From 2025 to 2027, it intends to use up to 30% of its free cash flow for shareholder returns.

Y ENTERTAINMENT continues its three-year shareholder return policy, allocating 10–20% of its standalone net profit as cash dividends annually. The dividend for the 2025 fiscal year was set at 300 won per share ( totaling 5.56406 billion won ), following payouts of 300 won and 250 won per share in the previous two years, respectively.

Other entertainment companies are also pursuing aggressive dividend policies. SM paid 1,200 won per share in 2022 and 2023, before reducing it to 400 won in 2024 and 1,620 won in 2025 ( totaling 37.0894 billion won ). JYP Ent. institutionalized its dividend policy in 2018 and decided to pay 534 won per share in 2024 and 877 won per share in 2025 ( totaling 29.05769 billion won ).

Notably, these companies continue to pay dividends even when facing poor financial results. Y ENTERTAINMENT distributed dividends in 2024 despite recording an operating loss, while HYBE also decided to pay a dividend despite its operating profit dropping by 72.9% year-on-year and incurring a net loss of 2.5668772 trillion won.

By demonstrating shareholder-friendly practices, these companies aim to prove the transparency of their management and show their commitment to returning profits to shareholders. This approach can help attract long-term investment. As ESG management gains global emphasis, improving shareholder value holds significant weight in such evaluations, which also drives the expansion of dividend policies.