WEBTOON Entertainment (NASDAQ:WBTN) Releases Earnings Results, Misses Expectations By $2.82 EPS

by · The Markets Daily

WEBTOON Entertainment (NASDAQ:WBTN – Get Free Report) released its quarterly earnings data on Tuesday. The company reported ($2.86) earnings per share for the quarter, missing the consensus estimate of ($0.04) by ($2.82), reports. The firm had revenue of $330.69 million during the quarter, compared to analysts’ expectations of $336.77 million. WEBTOON Entertainment had a negative net margin of 9.28% and a negative return on equity of 2.14%. The business’s revenue for the quarter was down 6.3% on a year-over-year basis. During the same period in the previous year, the business earned ($0.03) earnings per share.

Here are the key takeaways from WEBTOON Entertainment’s conference call:

  • WEBTOON completed a strategic agreement with The Walt Disney Company (Disney acquired ~2.7M shares for ~$32.8M), and the companies are building an all‑new digital comics platform targeting a 2026 launch with WEBTOON operating the platform and recognizing revenue and costs.
  • While adjusted EBITDA improved (Q4 adjusted EBITDA $0.6M; full year $19.4M), GAAP results showed large net losses driven by goodwill impairments—Q4 net loss $336.5M and full year net loss $373.4M—largely attributable to Wattpad.
  • User engagement shows signs of recovery—company MPU turned positive in Q4 (+0.7% overall; Korea +3.3%; rest of world MPU +5.7%)—but MAU declined (global MAU down 1.7% in Q4, down 7.1% for the year), with some MAU distortion from automated Wattpad web traffic in non‑core markets.
  • Q1 2026 guidance is modest (revenue -1.5% to +1.5% CC, $317M–$327M; adjusted EBITDA $0–$5M), while management expects to return to double‑digit YoY revenue growth by the end of 2026 driven by paid content, advertising recovery, and IP adaptations.
  • Content and IP initiatives continue to accelerate—examples include 12 Disney reformats already launched, Amazon MGM green‑lighting Lore Olympus, 20 new anime projects in Japan, and new anime/live‑action adaptations—supporting cross‑platform monetization and discovery.

WEBTOON Entertainment Price Performance

Shares of WEBTOON Entertainment stock traded down $0.88 during trading on Wednesday, hitting $10.64. 299,222 shares of the company’s stock traded hands, compared to its average volume of 317,028. The firm’s fifty day moving average price is $12.33 and its 200 day moving average price is $14.63. The company has a market cap of $1.39 billion, a PE ratio of -10.53 and a beta of 1.94. WEBTOON Entertainment has a twelve month low of $6.75 and a twelve month high of $22.47.

Analyst Upgrades and Downgrades

A number of equities analysts have recently weighed in on WBTN shares. Zacks Research lowered shares of WEBTOON Entertainment from a “strong-buy” rating to a “hold” rating in a research report on Thursday, November 20th. UBS Group cut WEBTOON Entertainment from a “buy” rating to a “neutral” rating in a report on Friday, November 14th. Weiss Ratings restated a “sell (d-)” rating on shares of WEBTOON Entertainment in a report on Wednesday, January 21st. HSBC cut WEBTOON Entertainment from a “buy” rating to a “hold” rating and set a $11.50 price target on the stock. in a research report on Wednesday. Finally, Wall Street Zen cut shares of WEBTOON Entertainment from a “hold” rating to a “sell” rating in a research note on Monday. Four investment analysts have rated the stock with a Buy rating, five have issued a Hold rating and one has issued a Sell rating to the company. According to MarketBeat, the company currently has a consensus rating of “Hold” and a consensus price target of $15.79.

Read Our Latest Stock Report on WEBTOON Entertainment

Trending Headlines about WEBTOON Entertainment

Here are the key news stories impacting WEBTOON Entertainment this week:

  • Positive Sentiment: Company highlights full‑year 2025 revenue growth (2.5% YoY; 3.9% on a constant currency basis) and reported cash and cash equivalents of roughly $582 million with no debt — a defensive balance sheet that can support content investment and M&A optionality. WEBTOON Entertainment Inc. Reports Fourth Quarter and Full Year 2025 Financial Results
  • Positive Sentiment: Management is engaging the investor community by scheduling participation in upcoming investor conferences — increases visibility and provides an opportunity to outline strategy and cost/revenue levers. WEBTOON Entertainment Inc. to Participate in Upcoming Investor Conferences
  • Neutral Sentiment: Earnings call transcript and analyst writeups are available for deeper read — useful for investors who want line‑by‑line color on user metrics, content costs and FY26 priorities but don’t change the headline story on results. WBTN Q4 2025 Earnings Call Transcript
  • Negative Sentiment: Q4 results missed expectations on profit and revenue: the company reported a sizable EPS shortfall and revenue slightly below consensus; Q4 revenue declined ~6.3% YoY and net margin remained negative — headline misses are a principal reason for downward pressure. WEBTOON earnings and call
  • Negative Sentiment: Management lowered Q1 2026 revenue guidance to $317M–$327M versus a ~$347.5M consensus — the guidance cut is a clear near‑term negative catalyst, increasing upside risk to analysts’ estimates. (Guidance disclosed in company filings/earnings materials.)
  • Negative Sentiment: HSBC downgraded WBTN from Buy to Hold, setting a $11.50 price target (slightly below recent trading) — analyst downgrade adds selling pressure and signals reduced conviction on near‑term growth.
  • Negative Sentiment: Ongoing litigation risk: a securities‑fraud shareholder action survived a motion to dismiss, which preserves potential legal overhang and uncertainty for long‑term holders. Grabar Law Office Investigates Claims

Institutional Trading of WEBTOON Entertainment

Hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Invesco Ltd. acquired a new position in shares of WEBTOON Entertainment during the first quarter worth about $123,000. Jacobs Levy Equity Management Inc. acquired a new stake in WEBTOON Entertainment during the 1st quarter worth approximately $228,000. Dynamic Technology Lab Private Ltd acquired a new position in WEBTOON Entertainment in the 1st quarter valued at $129,000. Jane Street Group LLC acquired a new stake in WEBTOON Entertainment in the 1st quarter worth about $619,000. Finally, Geode Capital Management LLC raised its position in shares of WEBTOON Entertainment by 12.3% in the 2nd quarter. Geode Capital Management LLC now owns 505,892 shares of the company’s stock valued at $4,594,000 after buying an additional 55,434 shares in the last quarter.

About WEBTOON Entertainment

(Get Free Report)

Webtoon Entertainment Inc operates WEBTOON, a leading digital comics platform offering a diverse library of user-generated and professionally produced webcomics. The company enables creators around the world to publish serialized content in a vertical-scrolling format optimized for mobile and web consumption. Through its platform, readers can access thousands of titles across genres such as romance, fantasy, drama, and action, with both free-to-read episodes and advanced access options supported by microtransactions and advertising.

Founded as part of Naver Corporation and launched internationally in 2014, Webtoon Entertainment has grown rapidly by fostering a direct connection between comic creators and global audiences.

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