Webtoon Entertainment, a leader in webcomics and owner of Wattpad, reported an 8.7% increase in revenue for the third quarter ended September 30, 2025, with sales hitting $378 million. Higher costs, including higher income tax expense, however, resulted in a net loss of $11.1 million compared to net income of $20 million a year ago. Sales rose in Webtoon's paid content group—it largest operating segment—as well as IP adaptations, but advertising sales fell.
In prepared remarks, Webtoon founder and CEO Junkoo Kim glossed over the financial results and instead pointed to progress made in "driving product improvements on our platform and providing a greater diversity of content." He also highlighted the company's expanded relationship with Disney to develop a new digital comics platform as well as a non-binding agreement for Disney to acquire a 2% interest in Webtoon.
Despite Kim's rosy pronouncements, the immediate financial performance for Webtoon is not good. The company projected that revenue would decline on a constant currency basis (which excludes currency fluctuations) in the range of 5.1% to 2.3%, and that it would have an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss in the range of $6.5 million to $1.5 million.
Following the release of the financial report, Webtoon's stock price tumbled, falling by over 20% when the market opened this morning.
