SM Entertainment Stock Falls Despite Court Victory Against EXO CBX

• SM Entertainment’s stock dropped 2.15% despite winning all lawsuits against EXO CBX.
• Only six EXO members are set for December events, excluding Baekhyun, Chen, and Xiumin.
• EXO-CBX has yet to pay 10% of their revenue to SM Entertainment.

SM Entertainment's stocks fell on October 29, 2025, despite earning a sweeping legal victory in its long-running dispute with EXO CBX, a sub-group of its most successful idol group EXO.

Even though SM is regarded as one of the "Big 3" of the K-Pop industry, the company's share fell from 121,100 KRW to 118,500 KRW, a drop of about 2.15%, which indicates that legal clarity might not always secure instant investor confidence.

The company announced that EXO will be holding a year-end fan meet around December 13-14 at Inspire Arena, Incheon. The group also has plans to release its eighth full-length album in early 2026.

Nevertheless, only six members are listed in the activities, adding uncertainty about the absence of the CBX trio, composed of members Baekhyun, Chen, and Xiumin.

What Exactly Happened Between EXO CBX and SM Entertainment?

The legal feud, which dates back to 2023, was based on CBX alleging that SM violated "a verbal agreement" to get a 5.5% distribution fee, and as a result, blocked payments. Ever since then, several lawsuits have ensued. CBX also sought the termination of their contract with SM Entertainment, citing a lack of "transparency of earnings, allegations of unfair contracts, and unfulfilled requests for accounting data." 

More than one court was involved in this case, including the Seoul Eastern District Court, High Court, and Supreme Court. Investigations were also carried out by the Korean Ministry of Culture, Sports and Tourism and the Korea Fair Trade Commission, which found no breach by SM Entertainment.

EXO CBX Not to Take Part in EXO Fan Meet? SM Entertainment Responds

CBX’s agency INB100 recently released a statement which said, “While we were working hard to prepare for full EXO promotions, we received an announcement regarding the holding of an EXO fan meeting and the release of a full album, excluding EXO-CBX.” 

The subgroup had reportedly agreed to all of the proposed conditions by their parent company in their second mediation session held on October 2. According to a statement given by the agency of the sub-group, the trio “have chosen to reach an agreement because they value the relationship with their longtime fans above all else.”

Meanwhile, SM Entertainment has refuted these claims of an unconditional approach. The company, in a statement, expressed “deep regret over this distortion of facts,” and said that immediately after the mediation session of October 2, EXO CBX filed for an objection again on October 16.

SM further stated, “Multiple unreasonable lawsuits have not only significantly destroyed trust between our two sides, but have also caused great harm to the group EXO and wounded both the fans and the members. Therefore, it was only natural that the trio should first fulfill the terms of the existing agreement and demonstrate a sincere effort to restore trust.”

INB100 reportedly again reached out to SM on October 30, saying that EXO-CBX “remains committed to paying 10% of their revenue to SM Entertainment,” however, “all negotiations have been based on the premise of full-group EXO activities.” According to an agreement clause initiated on June 18, 2023, each of the members of EXO CBX is also reportedly required to pay 10% of their income, individually, to the company. 

These lawsuits and repetitive legal objections by the sub-group, additionally the rumours of the legal terms, have possibly led to investor concerns. Despite winning the legal battle, there are still questions about how the company manages its partnerships and public image. EXO's full-group return in 2026 could improve SM's success, but if issues with the members persist, fan support and sales may suffer.