Delivered Revenue Within Guidance Range and Adjusted EBITDA Well Above the High-End of Guidance Range
First Quarter Revenue Decline of 1.5% Year-Over-Year; Revenue Growth on a Constant Currency Basis of 0.2%
Net Loss of $8.8 million; Adjusted EBITDA of $9.5 million
Strong Balance Sheet With Cash and Cash Equivalents of Approximately $594.9 million and No Debt
LOS ANGELES, May 11, 2026 (GLOBE NEWSWIRE) -- WEBTOON Entertainment Inc. (Nasdaq: WBTN) ("WEBTOON Entertainment" or "the Company"), a leading global entertainment company and home to some of the world's largest storytelling platforms, today announced results for its first quarter ended March 31, 2026. More information about these results can be found in the Company's shareholder letter on the investor relations section of its website.
First Quarter 2026 Highlights (vs. First Quarter 2025)
-- Total revenue of $320.9 million declined 1.5%, driven by declines in IP
Adaptations and Advertising, partially offset by growth in Paid Content.
-- Revenue on a constant currency basis was $326.4 million, growing 0.2%,
driven by growth in Paid Content and Advertising, offset by a decline in
IP Adaptations.
-- Net Loss was $8.8 million, compared to $22.0 million in the prior year,
driven primarily by better gross profit.
-- Adjusted EBITDA was $9.5 million, compared to $4.1 million in the prior
year , due to effective cost controls. Adjusted EBITDA Margin was 3.0%,
compared to 1.3% in the prior year.
-- Diluted loss per share was $0.07, compared to diluted loss per share of
$0.17 in the prior year.
-- Adjusted Earnings Per Share was $0.07, compared to $0.03 in the prior
year.
-- Cash and cash equivalents of approximately $594.9 million plus another
$11.1 million of short-term deposits included in prepaid expenses and
other current assets.
-- Cash outflow from operations was $11.8 million, compared to a cash
outflow of $18.7 million in the prior year.
Junkoo Kim, Founder and CEO, said, "We are pleased to share our solid first quarter results with constant currency revenue of $326.4 million, in line with our expectations, and a significant Adjusted EBITDA increase of 132% year-over-year."
Kim continued, "Importantly, we are continuing to strategically invest across our flywheel. We remain focused on expanding our creator ecosystem, and will introduce major updates to our amateur CANVAS platform throughout the year, positioning us well to produce even more diverse content that our users love. As we look to the rest of the year, we will remain focused on investing in the business to drive further innovation and long-term growth."
Second Quarter 2026 Outlook
For the second quarter 2026, the Company expects:
-- Revenue growth on a constant currency basis in the range of 1.7%-4.6%.
This represents revenue in the range of $332-$342 million, based on
current FX rates.
-- Adjusted EBITDA in the range of $0.0-$5.0 million, representing an
Adjusted EBITDA Margin in the range of 0.0%-1.5%.
Conference Call & Webcast Details
As previously disclosed, the Company will host a webcast and conference call on May 11, 2026, at 4:30 p.m. Eastern Time, to discuss the Company's financial results for its first quarter ended March 31, 2026.
A live webcast of the conference call will be available online at https://ir.webtoon.com/.
For those unable to listen to the live webcast, an archived version will be available at the same location for up to one year.
About WEBTOON Entertainment Inc.
WEBTOON Entertainment is a leading global entertainment company and home to some of the world's largest storytelling platforms. As the global leader and pioneer of the mobile webcomic format, WEBTOON Entertainment has transformed comics and visual storytelling for fans and creators.
With its CANVAS UGC platform empowering anyone to become a creator, and a growing roster of superstar WEBTOON Originals creators and series, WEBTOON Entertainment's passionate fandoms are the new face of pop culture. WEBTOON Entertainment adaptations are available on Netflix, Prime Video, Crunchyroll, and other screens around the world, and the company's content partners have included Warner Bros. Animation, Discord, HYBE, and Duolingo, among many others.
With approximately 145 million monthly active users, WEBTOON Entertainment's IP & Creator Ecosystem of aligned brands and platforms include WEBTOON, Wattpad--the world's leading webnovel platform--WEBTOON Productions, Studio N, Studio LICO, WEBTOON Unscrolled, LINE MANGA, and eBookJapan, among others.
Forward-Looking Statements
This release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, and involves risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed or implied by forward-looking statements. Forward-looking statements cover all matters which are not historical facts and include, without limitation, statements or guidance regarding or relating to our future financial position, results of operations and growth, plans and objectives for future capabilities, ability to attract users in both our core and underpenetrated geographies, ability to grow Paid Content, Advertising and IP Adaptations businesses, the impact of our product development initiatives, including our use of AI, our financial condition and liquidity, and other statements concerning the success of our business and strategies. Forward-looking statements may be identified by the use of words such as "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future periods. Forward-looking statements speak only as of the date on which they are made. They are not assurances of future performance and are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Therefore, you should not place undue reliance on any of these forward-looking statements. Although we believe that the forward-looking statements contained in this release are based on reasonable assumptions, you should be aware that many factors could cause actual results to differ materially from those in such forward-looking statements, including, but not limited to: weakness in the economy, market trends, uncertainty and other conditions in the markets in which we operate, and other geopolitical or macroeconomic factors beyond our control; inability to attract, empower, properly support or incentivize our creators; inability to retain, attract and engage with our users; inability to anticipate, understand and appropriately respond to market trends and changing user preferences; failure to retain or increase our paying users; failure to effectively operate in highly competitive markets; inability to innovate and expand our Advertising business; inability to continue to diversify our monetization strategy or to increase revenues from IP Adaptations; failure to control our content-related costs; exposure to significant legal proceedings and regulatory investigations which may result in significant expenses, fines and reputational damage; failure to provide a safe online environment for children; exposure to claims that we violated third parties' intellectual property rights; failure to obtain, maintain, protect or enforce our proprietary and intellectual property rights; exposure to liability and adverse effects from the use of AI; rise of conflicts of interests with NAVER Corporation, our majority stockholder; and other risks and uncertainties set forth under the caption "Risk Factors" in our most recent Annual Report on Form 10-K, and in other filings we make with the SEC in the future.
Additionally, forward-looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Other than in accordance with our legal or regulatory obligations, we undertake no obligations to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Non-GAAP Financial Measures & Definitions
This release contains certain financial information that is not presented in conformity with U.S. GAAP. These non-GAAP measures include Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Earnings Per Share (Adjusted EPS), revenue on a constant currency basis and revenue growth on a constant currency basis.
We believe that these non-GAAP measures provide users of the Company's financial information with additional meaningful information to assist in understanding financial results and assessing the Company's performance from period to period. Management believes these measures are important indicators of operations because they exclude items that may not be indicative of our core operating results and provide a better baseline for analyzing trends in our underlying businesses, and they are consistent with how business performance is planned, reported and assessed internally by management and the board of directors of the Company. Our non-GAAP financial measures should not be considered in isolation, or as substitutes for, financial information prepared in accordance with GAAP. Non-GAAP measures have limitations as they do not reflect all the amounts associated with our results of operations as determined in accordance with GAAP, and should only be used to evaluate our results of operations in conjunction with the corresponding or the most directly comparable GAAP measures. We strongly encourage investors and shareholders to review our financial statements and publicly filed reports in their entirety and not to rely on any single
financial measure.
A reconciliation is provided at the end of this release for each historical non-GAAP financial measure to the most directly comparable financial measure stated in accordance with U.S. GAAP. We encourage investors and shareholders to review the related U.S. GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures, and not to rely on any single financial measure to evaluate our business. We do not provide a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures on a forward-looking basis because we are unable to predict with reasonable certainty or without unreasonable effort non-recurring items that may arise in the future.
Adjusted EBITDA: We define Adjusted EBITDA as net income (loss), adjusted to remove the impact of interest income, interest expense, income tax expense (benefit) and depreciation and amortization, with further adjustments to eliminate the effects of loss on equity method investments, effect of applying the valuation method of fair value through profit or loss, impairment of goodwill, non-cash stock-based compensation and certain other non-recurring costs.
Adjusted EBITDA Margin: We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue.
Adjusted Earnings Per Share (Adjusted EPS): We define Adjusted Earnings Per Share as Earnings Per Share before interest expense, interest income, income tax expense (benefit) and depreciation and amortization with further adjustments to eliminate the effects of loss on equity method investments, effect of applying the valuation method of fair value through profit or loss, impairment of goodwill, non-cash stock-based compensation and certain other non-recurring costs. We calculate Adjusted Earnings Per Share by making the adjustments described herein from Net Income (Loss) and dividing by basic and diluted weighted average shares of common stock outstanding, respectively, for the applicable period.
Revenue on a Constant Currency Basis: We define revenue on a constant currency basis as revenue adjusted to remove the impact of foreign currency rate fluctuations and the impact of deconsolidated and transferred operations. We calculate revenue on a constant currency basis in a given period by applying the average currency exchange rates in the comparable period of the prior year to the local currency revenue in the current period. We calculate revenue on a constant currency basis in each of our revenue streams -- Paid Content, Advertising and IP Adaptations -- using the same method as laid out herein.
Revenue Growth on a Constant Currency Basis: We define revenue growth on a constant currency basis as period-over-period growth rates of revenue, adjusted to remove the impact of foreign currency rate fluctuations and the impact of deconsolidated and transferred operations. We calculate revenue growth (as a percentage) on a constant currency basis by determining the increase in current period revenue over prior period revenue, where current period foreign currency revenue is translated using prior period average currency exchange rates.
Financial Statements
WEBTOON Entertainment Inc.
Consolidated Balance Sheets
(unaudited)
(in thousands of USD, except share and per share data)
------------------------------------------------------------------------
As of
March 31, 2026 December 31, 2025
---------------- ---------------------
Assets
Current assets:
Cash and cash equivalents $ 594,852 $ 581,806
Receivables(1) , net of
allowance for credit losses of
$1,703 and $3,378 at March 31,
2026 and December 31, 2025
respectively 182,781 176,779
Prepaid expenses and other
current assets, net(2) 73,369 72,647
----------- --------------
Total current assets 851,002 831,232
Property and equipment, net 10,594 8,339
Operating lease right-of-use
assets 20,510 23,705
Debt and equity securities 64,348 69,669
Intangible assets, net 150,923 157,804
Goodwill, net 330,832 336,825
Equity method investments 76,212 80,440
Deferred tax assets 23,643 22,302
Other non-current assets,
net(3) 65,681 65,194
----------- --------------
Total assets $ 1,593,745 $ 1,595,510
=========== ==============
Liabilities and equity
Current liabilities:
Accounts payable(4) $ 137,695 $ 136,962
Accrued expenses(5) 53,837 66,690
Current portion of operating
lease liabilities(6) 8,679 9,617
Contract liabilities 94,640 89,994
Taxes payable 7,000 4,136
Provisions and defined pension
benefits 7,013 8,766
Other current liabilities 3,913 2,457
----------- --------------
Total current liabilities 312,777 318,622
Non-current liabilities:
Long-term operating lease
liabilities(7) 11,673 14,055
Defined severance benefits 24,502 25,069
Deferred tax liabilities 5,879 5,755
Other non-current liabilities 3,683 3,737
----------- --------------
Total liabilities 358,514 367,238
Commitments and Contingencies
(Note 8)
Redeemable non-controlling
interest in subsidiary $ 24,336 $ 24,540
Stockholders' equity:
Common stock, $0.0001 par
value (2,000,000,000
authorized, 134,635,086
shares and 130,776,161 shares
issued and outstanding as of
March 31, 2026, and December
31, 2025, respectively) 13 13
Additional paid-in capital 2,177,445 2,137,926
Accumulated other comprehensive
loss (137,007) (114,363)
Accumulated deficit (862,579) (853,124)
----------- --------------
Total stockholders' equity
attributable to WEBTOON
Entertainment Inc. 1,177,872 1,170,452
Non-controlling interests in
consolidated subsidiaries 33,023 33,280
----------- --------------
Total equity $ 1,210,895 $ 1,203,732
=========== ==============
Total liabilities, redeemable
non-controlling interest, and
equity $ 1,593,745 $ 1,595,510
(1. Includes amounts due from related parties of $54,303
and $55,156 as of March 31, 2026, and December 31,
2025, respectively.)
(2. Includes amounts due from related parties of $4,053
and $4,730 as of March 31, 2026, and December 31,
2025, respectively.)
(3. Includes amounts due from related parties of $33,786
and $33,913 as of March 31, 2026, and December 31,
2025, respectively.)
(4. Includes amounts due to related parties of $24,207
and $18,765 as of March 31, 2026, and December 31,
2025, respectively.)
(5. Includes amounts due to related parties of $6,048
and $6,849 as of March 31, 2026, and December 31,
2025, respectively.)
(6. Includes amounts due to related parties of $4,953
and $5,221 as of March 31, 2026, and December 31,
2025, respectively.)
(7. Includes amounts due to related parties of $3,933
and $5,371 as of March 31, 2026, and December 31,
2025, respectively.)
WEBTOON Entertainment Inc.
Consolidated Statements of Operations and Comprehensive
Loss
(unaudited)
(in thousands of USD, except share and per share data)
Three Months Ended
------------------------------------
March 31, 2026 March 31, 2025
---------------- ------------------
Revenue(1) $ 320,872 $ 325,707
Cost of revenue(2) (237,824) (254,096)
Marketing(3) (30,520) (31,543)
General and administrative
expenses(4) (60,559) (66,702)
----------- -----------
Operating income (loss) (8,031) (26,634)
Interest income 4,374 5,113
Interest expense (17) (2)
Gain (loss) on equity method
investments, net (446) (569)
Other income (loss), net(5) (2,005) 2,670
----------- -----------
Income (loss) before income tax (6,125) (19,422)
Income tax expense (2,672) (2,547)
----------- -----------
Net income (loss) $ (8,797) $ (21,969)
=========== ===========
Net income (loss) attributable to
WEBTOON Entertainment Inc. (9,455) (22,389)
Net income (loss) attributable to
non-controlling interests and
redeemable non-controlling
interests 658 420
Other comprehensive income
(loss):
Foreign currency translation
adjustments, net of tax (23,747) 6,572
Share of other comprehensive loss
of equity method investments, net
of tax $ (15) $ (143)
----------- -----------
Total other comprehensive income
(loss), net of tax (23,762) 6,429
----------- -----------
Total comprehensive income (loss) $ (32,559) $ (15,540)
=========== ===========
Total comprehensive income (loss)
attributable to WEBTOON
Entertainment Inc. $ (32,099) $ (15,999)
Total comprehensive income (loss)
attributable to non-controlling
interests and redeemable
non-controlling interests (460) 459
Weighted average shares
outstanding
Basic 133,618,587 129,598,942
Diluted 133,618,587 129,598,942
Income (loss) per share
attributable to WEBTOON
Entertainment Inc.
Basic $ (0.07) $ (0.17)
Diluted $ (0.07) $ (0.17)
(1. Includes amounts earned from related parties of
$18,243 and $17,713 for the three months ended March
31, 2026, and March 31, 2025, respectively.)
(2. Includes amounts incurred from related parties
of $27,071 and $28,131 for the three months ended
March 31, 2026, and March 31, 2025, respectively.)
3. Includes amounts incurred from related parties
of $(1,729) and $(2,581) for the three months ended
March 31, 2026, and March 31, 2025, respectively.
(4. Includes amounts incurred from related parties
of $7,817 and $6,913 for the three months ended March
31, 2026, and March 31, 2025, respectively.)
(5. Includes amounts earned from related parties of
$408 and $411 for the three months ended March 31,
2026, and March 31, 2025, respectively.)
WEBTOON Entertainment Inc.
Consolidated Statements of Cash Flows
(unaudited)
(in thousands of USD)
For the Three Months Ended
---------------------------------------
March 31, 2026 March 31, 2025
------------------- ------------------
Operating activities:
Net income (loss) $ (8,797) $ (21,969)
Adjustments to reconcile
net loss to net cash
used in operating
activities:
Allowance for credit losses (749) 443
Depreciation and
amortization 7,998 8,437
Operating lease expense 2,541 1,985
Gain on foreign currency, net (6,207) (2,793)
Deferred tax benefit (2,151) (1,143)
Loss on debt and equity
securities, net 2,627 930
Change in severance
benefit, net 1,562 574
Loss on equity method
investments, net 446 569
Stock-based compensation 7,625 18,253
Other non-cash items (2,963) (1,369)
Changes in operating
assets and liabilities
Changes in receivables (11,669) 750
Changes in other assets (4,122) (2,250)
Changes in accounts
payable 4,083 (2,801)
Changes in accrued
expenses (9,321) (15,342)
Changes in contract
liabilities 7,501 (1,450)
Changes in other
liabilities 2,516 (236)
Changes in operating
lease liabilities $ (2,767) $ (1,240)
Net cash used in operating
activities $ (11,847) $ (18,652)
Investing activities:
Proceeds from maturities
of short-term
investments 684 3,446
Proceeds from sale of
property and equipment 23 77
Purchases of property and
equipment (3,148) (536)
Purchases of debt and
equity securities -- (3,789)
Payment made for
short-term investments (1,368) (4,824)
Payment made for loan
receivable (68) (207)
Purchases of intangible assets (2,867) (2,444)
Other investing
activities -- 249
--- ------------- -----------
Net cash used in investing
activities $ (6,744) $ (8,028)
Financing activities:
Proceeds from issuance of
common stock related to
private placement, net 32,682 --
Proceeds from stock
option exercise -- 82
Net cash provided by
financing activities $ 32,682 $ 82
Effect of exchange rate changes
on cash and cash equivalents (1,045) 4,332
Cash and cash
equivalents:
Net increase (decrease)
in cash and cash
equivalents 13,046 (22,266)
Cash and cash equivalents
at beginning of the
year 581,806 572,402
--- ------------- -----------
Cash and cash equivalents
at end of the year $ 594,852 $ 550,136
=== ============= ===========
Supplemental disclosure:
Income taxes paid $ 2,711 $ 6,826
Reclassification of long-term
advances to current $ (10,901) $ (28,973)
Increase in right-of-use assets
recognized from new lease
agreements $ 4 $ 12,007
Reconciliation of Non-GAAP Measures
------------------------------------------------------------------
The following table presents a reconciliation of revenue
to revenue on a constant currency basis, and ARPPU
to ARPPU on a constant currency basis, respectively,
for each of the periods presented.
Three Months Ended March 31,
-------
(in thousands of USD,
except percentages) 2026 2025 Change
------------- ------------
Total Revenue $ 320,872 $ 325,707 (1.5%)
Effects of foreign
currency rate
fluctuations 5,491 - N/A
------------- ------------
Revenue on a Constant
Currency Basis $ 326,363 $ 325,707 0.2%
============= ============
Paid Content Revenue 261,438 260,226 0.5%
Effects of
foreign currency
rate
fluctuations 4,797 - N/A
------------- ------------
Paid Content Revenue on
a Constant Currency
Basis $ 266,235 $ 260,226 2.3%
============= ============
Advertising Revenue 39,682 39,898 (0.5%)
Effects of
foreign currency
rate
fluctuations 541 - N/A
------------- ------------
Advertising Revenue on
a Constant Currency
Basis $ 40,223 $ 39,898 0.8%
============= ============
IP Adaptations Revenue 19,752 25,583 (22.8%)
Effects of
foreign currency
rate
fluctuations 153 - N/A
------------- ------------
IP Adaptations Revenue
on a Constant Currency
Basis $ 19,905 $ 25,583 (22.2%)
============= ============
Paid Content Average
Revenue Per Paying
User ("ARPPU")
Korea Paid Content
Revenue $ 86,888 $ 77,027 12.8%
Korea ARPPU $ 7.8 $ 7.5 4.0%
Effects of
foreign currency
rate
fluctuations 0.1 - N/A
------------- ------------
Korea ARPPU on a
Constant
Currency Basis $ 7.9 $ 7.5 5.1%
============= ============
Japan Paid Content
Revenue 139,182 150,401 (7.5%)
Japan ARPPU 22.5 22.3 0.9%
Effects of
foreign currency
rate
fluctuations 0.6 - N/A
------------- ------------
Japan ARPPU on a
Constant
Currency Basis $ 23.2 $ 22.3 3.7%
============= ============
Rest of World Paid
Content Revenue 35,368 32,798 7.8%
Rest of World
ARPPU 6.8 6.5 4.4%
Rest of World
ARPPU on a
Constant
Currency Basis $ 6.8 $ 6.5 4.4%
============= ============
1. ARPPU is calculated by taking Paid Content revenue
and dividing it by the number of monthly paid users
("MPU") for such month, averaged over each month in
the given period. ARPPU on a constant currency basis
is calculated by dividing Paid Content revenue on
a constant currency basis by the number of MPU for
such month, averaged over each month in the given
period. Where each metric is country specific, the
numerator is Paid Content revenue on a constant currency
basis by country and the denominator is users by country.
The following table presents a reconciliation of net
loss to EBITDA, Adjusted EBITDA and Adjusted EBITDA
Margin for each of the periods presented.
Three Months Ended March 31,
(in thousands of USD, except
percentages) 2026 2025
----------- -----------
Net income (loss) $ (8,797) $ (21,969)
Interest income (4,374) (5,113)
Interest expense 17 2
Income tax expense (benefit) 2,672 2,547
Depreciation and
amortization 7,998 8,437
EBITDA $ (2,484) $ (16,096)
----------- -----------
Stock-based compensation
expense(1) 7,625 17,035
Restructuring, advisory and legal
fees(2) 1,267 1,642
Loss (gain) on fair value
instruments, net(3) 2,627 930
Loss on equity method investments,
net(4) 446 569
Adjusted EBITDA(5) $ 9,481 $ 4,080
=========== ===========
Net income (loss) margin (2.7)% (6.7)%
Adjusted EBITDA Margin 3.0% 1.3%
Weighted average shares
outstanding
Basic 133,618,587 129,598,942
Diluted 133,618,587 129,598,942
Earnings (loss) per share
Basic $ (0.07) $ (0.17)
Diluted $ (0.07) $ (0.17)
Adjusted EPS(6)
Basic $ 0.07 $ 0.03
Diluted $ 0.07 $ 0.03
(1) Represents stock-based compensation expense related
to WEBTOON's equity incentive plan and stock-based
compensation plans of NAVER Corp. and Munpia Inc.,
including amounts which are cash settled.
(2) Represents specific costs that are incremental
and discrete to the periods presented and are not
indicative of our core ongoing operations. For the
three months ended March 31, 2026, these amounts were
comprised of (i) non-routine legal and professional
fees associated with the defense of the 2024 IPO-related
shareholder litigation, which are outside the ordinary
course of business; (ii) one-time advisory fees related
to a purchase agreement, that do not qualify as equity
issuance costs; and (iii) professional fees directly
related to the strategic restructuring initiative
of our Wattpad business. For the three months ended
March 31, 2025, these amounts included (i) non-routine
legal and professional fees associated with the defense
of the 2024 IPO-related shareholder litigation, which
are outside the ordinary course of business, and (ii)
professional fees associated with the initial implementation
of Sarbanes-Oxley ("SOX") compliance and IPO readiness.
(3) Represents unrealized net loss (gain) of financial
assets measured at FVPL, which include the Company's
equity investments.
(4) Represents our proportionate share of recognized
losses associated with our investments accounted for
using the equity method.
(5) Totals may not foot due to rounding.
(6) The numerator for Adjusted EPS is calculated by
adjusting Net Income (Loss) by the same items in the
Net Income (Loss) to Adjusted EBITDA reconciliation.
The denominator for computing Adjusted EPS is the
same as that used for Basic and Diluted EPS.
Contact Information
Investor Relations
Soohwan Kim, CFA & Taylor Giles
investor@webtoon.com
Corporate Communications
Kiel Hume
webtoonpress@webtoon.com
(END) Dow Jones Newswires
May 11, 2026 16:05 ET (20:05 GMT)