[Featured Stock] Ultimately a Catastrophe... HYBE Plummets 6% Following NewJeans Contract Termination

NewJeans, Stock Plummets After Exclusive Contract Termination Announcement
Record Breaker 'Adore's NewJeans' Enters History
Conflicting Positions Over Contract Termination... Legal Dispute Expected

HYBE's stock price fell below 200,000 KRW for the first time in 10 trading days. This appears to be influenced by the termination of NewJeans' exclusive contract.

As of 9:03 AM on the 29th, HYBE is trading at 193,900 KRW, down 4.72% (9,600 KRW) from the previous trading day. This is the first time HYBE's stock has traded below 200,000 KRW since the 15th (intraday low of 197,500 KRW). Right after the market opened, the stock price broke below 190,000 KRW, dropping as low as 189,300 KRW.

The day before, all five members of NewJeans held an emergency press conference near Samsung Station in Seoul and announced that they plan to terminate their exclusive contracts as of the 29th. The reason for the contract termination is that their agency, ADOR, failed to fulfill contractual obligations and showed no signs of improvement despite repeated requests. The conflict, which began in April, has ultimately reached a breaking point. They emphasized that since the fault lies with ADOR and HYBE, they will not pay any penalties. Although they may no longer be able to use the name "NewJeans" after terminating the exclusive contract, they said they will try to keep the name. Meanwhile, they plan to fulfill scheduled advertisements and events, and expressed a desire to work with former ADOR CEO Min Hee-jin in the future.

In response, ADOR stated, "We regret that the exclusive contract termination press conference was planned and held without sufficient review before receiving a reply to the certified letter," and rebutted, "ADOR, as the party to the exclusive contract, has not violated the contract, and a unilateral claim of broken trust does not constitute grounds for termination." They also said the exclusive contract is still valid and hope that future schedules will be carried out together with ADOR.

NewJeans, which debuted on July 22, 2022, is a girl group that set new K-pop records in a short period. They were the fastest K-pop group ever to top the US Billboard 200 after debut and achieved 1 billion cumulative streams on Spotify in the shortest time, earning a Guinness World Record. NewJeans was also the first K-pop girl group to have three or more songs simultaneously on the Billboard Hot 100, the main singles chart. Additionally, they set records such as the shortest time for a foreign female artist to reach 100 million streams on Japan's Oricon chart and entered Tokyo Dome in just 1 year and 11 months after debut, the shortest period for a foreign artist. They were also very popular domestically, ranking first alongside Lim Young-woong in Gallup's "Singers Who Shined in 2023" survey last year.

The "ADOR's NewJeans," a symbolically and genuinely representative domestic girl group, has now faded into history. It is still unknown which company they will work with or what name they will use in the future. It is expected that legal battles with ADOR will continue due to the unilateral declaration of exclusive contract termination. However, the possibility of NewJeans withdrawing the contract termination is slim, given their strong bond with former CEO Min Hee-jin. Some speculate that the penalty fees could amount to several hundred billion KRW.