Borchetta Buys Back Big Machine Brand as HYBE Profit Falls 73%

Scott Borchetta has pulled off one of the rarest maneuvers in modern music business history: the reverse brand acquisition.

As of Thursday, the Nashville mogul has exited HYBE America, taking the iconic Big Machine Records name and trademark with him to launch a new independent venture. In exchange, HYBE retains the "engine" that made the machine big: the artist roster, the distribution infrastructure, and the lucrative back catalog.

This uncoupling marks the final chapter of the Ithaca Holdings era, effectively scrubbing Scooter Braun’s original acquisition team from HYBE’s org chart while bifurcating one of country music’s most dominant forces.

The asset split

This isn't a standard exit package. The separation agreement slices intellectual property away from revenue-generating assets in a way that suggests HYBE is prioritizing cash flow over legacy branding.

Scott Borchetta gets:

The Big Machine Records brand name and trademarks.

Full autonomy to relaunch as an independent competitor.

A clean slate to sign new talent under a heritage banner.

HYBE America keeps:

The Roster: Contracts for superstars like Thomas Rhett, Carly Pearce, and Brett Young stay put.

The Catalog: Crucially, HYBE retains the master recordings—including the controversial six-album Taylor Swift catalog that drove the original acquisition.

Publishing: Big Machine Music remains under HYBE ownership.

Key distinction: Borchetta owns the flag, but HYBE owns the fort. The Nashville office will undergo an immediate rebrand to shed the "Big Machine" moniker while managing the same assets.

A 73% reality check

The timing of this divorce is inextricably linked to HYBE’s FY 2025 earnings, released the same day. While the K-pop giant posted record revenues of 2.65 trillion KRW ($1.86 billion), its profitability has cratered.

Operating profit plummeted 72.9% YoY to just $35.1 million, driven by restructuring costs and underperformance in the U.S. division. Specifically, streaming revenue for HYBE’s U.S. labels (including Big Machine and QC) fell to roughly $82.3 million, down from the previous year.

The strategic pivot: HYBE is moving toward a "label-centered IP business model." By letting Borchetta walk with the name, they cut high-level executive overhead while keeping the catalog annuities that investors value most.

Nashville's new battlefield

For managers and A&R reps on Music Row, this split creates immediate fragmentation. The market now has to process two distinct entities:

The New Big Machine: Borchetta’s indie startup, likely to be aggressive, agile, and well-capitalized, trading on two years of pent-up ambition.

HYBE Nashville (Rebranded): A corporate major with massive market share and deep pockets, but currently lacking its founder's vision and facing a morale-testing leadership transition.

The risk: Managers with acts on the HYBE roster face uncertainty. With the "Big Machine" identity gone, priority lists may shuffle as new leadership installs its own culture over the existing framework.

Founder leverage returns

Borchetta’s move signals a broader trend where founders are finding ways to reclaim their identities from conglomerate buyers.

For HYBE, this is a calculated bet that the assets (Swift’s masters, Rhett’s hits) are more valuable than the operator. For Borchetta, it is a bet that his reputation can build a second empire faster than the first one. The deal proves that in the current high-interest rate environment, even massive conglomerates are willing to barter prestige brands to streamline their bottom line.