Shares of WEBTOON Entertainment Inc. (WBTN) plummeted 27.32% during intraday trading on Thursday, following the release of disappointing third-quarter results and a weak fourth-quarter outlook. The digital comics firm's stock price tumbled to $12.35, erasing a substantial portion of its year-to-date gains.

WEBTOON reported Q3 revenue of $378.04 million, falling short of analysts' expectations of $385.1 million. The company also posted a net loss of $11.05 million, or $0.09 per share, compared to a profit of $19.986 million in the same quarter last year. Adding to investor concerns, WEBTOON forecasted a Q4 revenue decline between 2.3% and 5.1%, contrasting sharply with analysts' projections of a 12.3% increase. The company also expects an adjusted core loss of $1.5 million to $6.5 million in Q4, compared to the market's expectation of a $12.5 million profit.

In response to the disappointing results and outlook, several brokerages have cut their price targets for WEBTOON. JP Morgan reduced its target to $13 from $22, citing volatility in results and external challenges such as advertiser pullback in Korea and regulatory actions. Deutsche Bank also lowered its price target to $19 from $25. Analysts noted that while management remains committed to investing in maintaining webcomic leadership, WEBTOON now faces a "show-me story that requires solid execution" to regain investor confidence.