Webtoon 2025 Q3 Earnings Sharp Net Loss Deterioration of 155.3%

Webtoon (WBTN) reported a net loss of $11.05 million in Q3 2025, a 155.3% deterioration from $19.99 million net income in Q3 2024, while revenue rose 8.7% to $378.04 million. The company forecasted a Q4 revenue decline of 5.1%-2.3%, missing analyst expectations.

Revenue

Webtoon’s Q3 revenue totaled $378.04 million, driven by robust performance in Paid Content, which accounted for $286.81 million, while Advertising revenue stood at $39.37 million and IP Adaptations added $51.86 million. The total reflects an 8.7% year-over-year increase, though Advertising revenue fell short of expectations.

Earnings/Net Income

The company swung to a loss of $0.09 per share, a 160% negative change from $0.15 per share in Q3 2024. Net income plummeted to a $11.05 million loss, marking a 155.3% deterioration from the prior year’s $19.99 million profit. This sharp decline underscores significant earnings pressure.

Post-Earnings Price Action Review

Following the earnings report, Webtoon’s stock surged 7.10% in the latest trading day but faced a 21.82% drop over the preceding full week and a 29.93% monthly decline. The mixed short-term performance highlights investor uncertainty amid the company’s earnings shortfall and weak guidance.

CEO Commentary

Webtoon’s CEO emphasized strategic partnerships with Disney and Warner Bros. as growth catalysts, highlighting the launch of 10 animated projects and a digital comics platform. Despite the Q3 loss, the CEO expressed confidence in long-term monetization potential, citing momentum in English-speaking markets and innovation in content formats like video episodes.

Guidance

The company projected Q4 revenue between $330-$340 million, a decline on a constant currency basis, with adjusted EBITDA expected to show a loss of $6.5-$1.5 million. The guidance reflects near-term challenges in advertising and IP adaptation timing but underscores commitment to cost management.

Additional News

Webtoon announced a nonbinding partnership with Disney to develop a digital comics platform featuring 35,000 titles and a 2% equity stake by Disney. Separately, a collaboration with Warner Bros. Animation for 10 animated series was unveiled, targeting global distribution. Evercore ISI reduced its price target to $20 from $23, citing ad revenue weakness, while the stock hit a 52-week high of $19.63 earlier in the year.