Financial and Operational Highlights WEBTOON Entertainment reported strong Q2 2025 results, exceeding revenue and Adjusted EBITDA guidance. Revenue grew 8.5% to $348.3 million (5.5% on a constant currency basis), driven by growth in all segments. The company significantly narrowed its Net Loss to $3.9 million from $76.6 million a year ago, primarily due to lower G&A expenses. However, Adjusted EBITDA decreased to $9.7 million. The company maintains a strong balance sheet with $581.5 million in cash and no debt Q2 2025 Key Financial Metrics (vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $348.3M | $321.0M | +8.5% | | Revenue (Constant Currency) | $338.7M | $321.0M | +5.5% | | Net Loss | ($3.9M) | ($76.6M) | +94.9% | | Adjusted EBITDA | $9.7M | $20.4M | -52.5% | | Diluted Loss Per Share | ($0.03) | ($0.70) | +95.7% | | Adjusted EPS | $0.07 | $0.18 | -61.1% | - The company maintains a strong liquidity position with approximately $581.5 million in cash and cash equivalents and no debt on its balance sheet14 - A new strategic collaboration was announced with Disney to bring iconic comics from Marvel, Star Wars, Disney Studios, and 20th Century Studios to WEBTOON's vertical-scroll format5 Management Commentary and Outlook Management expressed satisfaction with the strong Q2 results, which surpassed guidance. The CEO highlighted growth across all three revenue streams (Paid Content, Advertising, and IP Adaptations) and emphasized platform investments, such as updates to the English-language app, to drive user engagement. The company provided a positive outlook for Q3 2025, forecasting continued revenue growth and positive Adjusted EBITDA - CEO Junkoo Kim stated that both revenue and Adjusted EBITDA came in above the top end of the company's guidance range for the quarter3 - Growth was driven by all three revenue streams: Paid Content, Advertising, and IP Adaptations34 - The company is investing in platform enhancements, such as updates to its English-language webcomic app, to improve content discovery and drive deeper user engagement35 Third Quarter 2025 Outlook | Metric | Guidance Range | | :--- | :--- | | Revenue Growth (Constant Currency) | 9.4% - 12.2% | | Revenue (at current FX rates) | $380M - $390M | | Adjusted EBITDA | $2.0M - $7.0M | | Adjusted EBITDA Margin | 0.5% - 1.8% | Financial Statements The consolidated financial statements provide a detailed view of WEBTOON's financial position and performance. The balance sheet shows an increase in total assets to $2.01 billion, supported by strong cash reserves. The statement of operations reflects an 8.5% year-over-year revenue increase in Q2 and a significantly narrowed net loss. The cash flow statement indicates cash used in operations for the first six months of 2025, a reversal from the cash provided in the same period of 2024, alongside positive cash flow from investing activities Consolidated Balance Sheets As of June 30, 2025, the company's balance sheet remains robust with total assets of $2.01 billion, up from $1.94 billion at the end of 2024. Cash and cash equivalents increased slightly to $581.5 million. Total liabilities grew to $411.8 million, while total equity increased to $1.56 billion Selected Balance Sheet Data (in thousands USD) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $581,546 | $572,402 | | Total current assets | $862,018 | $836,372 | | Total assets | $2,009,759 | $1,935,334 | | Total current liabilities | $339,848 | $313,224 | | Total liabilities | $411,802 | $378,873 | | Total equity | $1,560,280 | $1,519,881 | Consolidated Statements of Operations For the second quarter ended June 30, 2025, revenue increased 8.5% YoY to $348.3 million. The company recorded a net loss of $3.9 million, a substantial improvement from a $76.6 million net loss in Q2 2024. This improvement was primarily driven by a significant reduction in general and administrative expenses, which fell from $138.7 million to $65.0 million YoY Q2 Statement of Operations Highlights (in thousands USD) | Account | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $348,271 | $320,972 | | Cost of revenue | ($260,992) | ($237,915) | | General and administrative expenses | ($64,972) | ($138,705) | | Operating income (loss) | ($8,763) | ($79,096) | | Net income (loss) | ($3,883) | ($76,568) | | Diluted loss per share | ($0.03) | ($0.70) | Consolidated Statements of Cash Flows For the six months ended June 30, 2025, net cash used in operating activities was $13.0 million, a decrease from $22.4 million provided by operating activities in the prior-year period. Net cash provided by investing activities was $5.7 million, compared to $7.3 million used in the prior year. Financing activities were minimal, and the company's cash balance increased by $9.1 million during the period Six-Month Cash Flow Summary (in thousands USD) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | ($12,951) | $22,394 | | Net cash provided by (used in) investing activities | $5,711 | ($7,306) | | Net cash provided by (used in) financing activities | $229 | $336,053 | | Effect of exchange rate changes | $16,155 | ($10,581) | | Net increase in cash | $9,144 | $340,560 | Non-GAAP Financial Measures and Reconciliations This section defines the non-GAAP metrics used by management, such as Adjusted EBITDA and Revenue on a Constant Currency Basis, to assess performance. It provides detailed reconciliations of these measures to their nearest GAAP equivalents. For Q2 2025, constant currency revenue growth was 5.5%. Adjusted EBITDA was $9.7 million, reconciled from a net loss of $3.9 million by adding back items like stock-based compensation and restructuring costs Definitions of Non-GAAP Measures The company uses several non-GAAP measures to provide additional insight into its financial performance. Key metrics include Adjusted EBITDA, which excludes items like stock-based compensation; Adjusted EPS, which makes similar adjustments to earnings per share; and Revenue on a Constant Currency Basis, which removes the impact of foreign currency fluctuations - Adjusted EBITDA: Defined as net income (loss) adjusted for interest, taxes, depreciation, amortization, stock-based compensation, and other non-recurring costs17 - Adjusted EPS: Calculated by adjusting Net Income (Loss) for the same items as Adjusted EBITDA and dividing by weighted average shares outstanding1920 - Revenue on a Constant Currency Basis: Revenue adjusted to remove the impact of foreign currency rate fluctuations, calculated by applying prior year average exchange rates to current period local currency revenue21 Reconciliation of Revenue to Constant Currency Basis In Q2 2025, reported total revenue was $348.3 million. After adjusting for a negative $9.5 million impact from foreign currency fluctuations, the revenue on a constant currency basis was $338.7 million, representing 5.5% YoY growth. IP Adaptations showed the strongest constant currency growth at 42.6%, followed by Advertising at 10.2% and Paid Content at 2.0% Q2 2025 Revenue to Constant Currency Reconciliation (in thousands USD) | Description | Amount | Growth vs. Q2 2024 | | :--- | :--- | :--- | | Total Revenue (GAAP) | $348,271 | 8.5% | | Effects of foreign currency rate fluctuations | ($9,543) | N/A | | Revenue on a Constant Currency Basis | $338,728 | 5.5% | Reconciliation of Net Loss to Adjusted EBITDA For Q2 2025, the company reconciled its Net Loss of $3.9 million to an Adjusted EBITDA of $9.7 million. Key adjustments included adding back $8.4 million in depreciation and amortization, $8.5 million in stock-based compensation, and $1.5 million in restructuring and IPO-related costs. This resulted in an Adjusted EBITDA Margin of 2.8%, down from 6.3% in the prior year Q2 2025 Net Loss to Adjusted EBITDA Reconciliation (in thousands USD) | Description | Amount | | :--- | :--- | | Net income (loss) | ($3,883) | | Depreciation and amortization | $8,407 | | Stock-based compensation expense | $8,463 | | Restructuring and IPO-related costs | $1,476 | | Other adjustments | ($3,391) | | Adjusted EBITDA | $9,662 |
Webtoon Entertainment Inc.(WBTN) - 2025 Q2 - Quarterly Results