Webtoon Entertainment Inc (WBTN) Q2 2025 Earnings Call Highlights: Revenue Growth and Strategic ...

Release Date: August 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Webtoon Entertainment Inc (NASDAQ:WBTN) reported revenue growth of 5.5% on a constant currency basis, with an 8.5% increase in reported revenue. The company announced a significant partnership with Disney to bring iconic comics from Disney, Marvel, 20th Century Studios, and Star Wars to their platform. Webtoon Entertainment Inc (NASDAQ:WBTN) saw a 19% increase in English platform web comic app MAU for the second consecutive quarter. The company's IP adaptation business experienced a 42.6% revenue increase year over year on a constant currency basis. Advertising revenue grew by 10.2% on a constant currency basis, driven by growth in Korea and Japan.

Negative Points

Webtoon Entertainment Inc (NASDAQ:WBTN) reported a net loss of $3.9 million, although this was an improvement from the previous year's $76.6 million loss. Global MAU declined by 7.6%, primarily due to decreases in Korea and the rest of the world. The company faced challenges with Wattpad, including a government ban in one country and a new ban in another, impacting MAU. Adjusted EBITDA decreased to $9.7 million from $20.4 million in the prior year. The rest of the world saw a revenue decline of 4.4% year over year on a constant currency basis, driven by declines in paid content and advertising.

Q & A Highlights

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Q: Can you provide more details on the Disney partnership and its potential impact on user growth and monetization? A: David Lee, CFO and COO, explained that the collaboration with Disney is a significant milestone due to Disney's vast IP portfolio, including Marvel, 20th Century Studios, and Star Wars. This partnership is expected to accelerate user growth by introducing new stories in a vertical scrolling format, appealing to Gen Z consumers. However, no short-term financial benefits are included in the Q3 guidance, as the collaboration is built for long-term strategic value.

Q: Are there any marketing arrangements or other aspects of the Disney partnership you can discuss? A: David Lee noted that the partnership allows Disney to reach Gen Z users, who spend significant time on the platform. While specifics weren't disclosed, the collaboration is seen as a strategic opportunity for both parties to attract new users and enhance engagement.

Q: How should we think about user trends with the new onboarding process and revamped home tab? A: David Lee highlighted the new onboarding process, home tab, and search tab, which enhance personalization and content discovery. These updates have driven nearly 19% growth in English web comic app MAU over the last three quarters. The improvements are expected to continue driving user engagement and ARPU growth, especially in English-speaking regions.

Story Continues

Q: Can you discuss your advertising outlook for Q3 and the second half, particularly regarding video? A: David Lee stated that advertising remains a strong growth driver, with a 10.2% increase in Q2. Video ads offer an alternative way for users to access content and create habit formation. While it's early days in North America, the company is focused on building a foundation for future financial returns, particularly through collaborations with Disney and IDW.

Q: How does the success of bringing existing IP to the platform impact the strategy for user-created content? A: David Lee and Yong Soo Kim, Chief Strategy Officer, explained that the collaboration with Disney complements the existing creator ecosystem. The partnership includes opportunities for original content creation, allowing creators to develop new storylines from established franchises. This strategy is expected to increase user engagement and consumption.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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