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WEBTOON Entertainment Inc
(NASDAQ:WBTN)
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Rating:47Neutral
Price Target:
$9.50
▲(5.56% Upside)
Action:Reiterated
Date:08/11/26
The score is held down primarily by weak financial performance (sharp TTM revenue contraction, continued losses, and negative TTM free cash flow) and bearish technical trends (below major moving averages with negative MACD). Partially offsetting this are a conservative balance sheet and a moderately constructive earnings outlook that points to modest near-term growth and a stated goal to re-accelerate revenue growth by year-end.
Positive Factors
Strong liquidity and low leverage
A large cash balance and minimal leverage give the company durable financial flexibility to fund product investments, IP deals, and operating losses without near-term refinancing risk. This supports multi-quarter execution of growth initiatives even if cash burn persists.
Negative Factors
Sharp TTM revenue contraction
A severe trailing-twelve-month revenue drop indicates top-line instability that undermines planning and scale economics. Persistent revenue volatility makes sustainable margin expansion and predictable cash conversion difficult over the medium term without clear, sustained reacceleration.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong liquidity and low leverage
A large cash balance and minimal leverage give the company durable financial flexibility to fund product investments, IP deals, and operating losses without near-term refinancing risk. This supports multi-quarter execution of growth initiatives even if cash burn persists.
Read all positive factors
WEBTOON Entertainment Inc (WBTN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.17B
Dividend YieldN/A
Average Volume (3M)399.51K
Price to Earnings (P/E)―
Beta (1Y)1.58
Revenue Growth-0.49%
EPS Growth-238.97%
CountryUS
Employees1,800
SectorGeneral
Sector StrengthN/A
IndustryInternet Content & Information
Share Statistics
EPS (TTM)-2.63
Shares Outstanding135,711,070
10 Day Avg. Volume426,872
30 Day Avg. Volume399,512
Financial Highlights & Ratios
PEG Ratio-0.04
Price to Book (P/B)1.45
Price to Sales (P/S)1.23
P/FCF Ratio-253.36
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda>-0.01
Forecast
1Y Price Target
$11.00Price Target Upside22.22% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
EPS Forecast (FY)-0.18
Revenue Forecast (FY)$1.41B
WEBTOON Entertainment Inc Business Overview & Revenue Model
Company Description
WEBTOON Entertainment Inc. manages a global digital platform dedicated to narratives. This platform cultivates an active community, empowering both content creators and readers to find, develop, and distribute original stories. Its primary offerin...
How the Company Makes Money
WEBTOON primarily monetizes its platform through a mix of digital content sales and advertising, supplemented by licensing of intellectual property. (1) Paid digital content: The company sells access to premium episodes/chapters and offers paid fe...
WEBTOON Entertainment Inc Earnings Call Summary
Earnings Call Date:Aug 10, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call conveyed a generally constructive strategic narrative: strong operational performance in Korea, robust advertising and rest-of-world revenue growth, meaningful product and AI initiatives, and decisive investments to capture more IP upside (Allied Games and $100M adaptation fund). Offsetting these positives were near-term profitability pressures (larger net loss, lower adjusted EBITDA and margins) driven by elevated marketing spend and mixed user/monetization trends in Japan and certain app metrics. Management provided near-term guidance that implies modest sequential growth with an explicit objective to return to double-digit revenue growth by year-end. Overall, the company appears to be investing now to strengthen long-term growth and monetization while accepting short-term margin impact.Positive Updates
Revenue and Constant-Currency Growth
Reported revenue of $339.0M in Q2 FY26; down 2.8% year-over-year on a reported basis but up 5.2% on a constant currency basis driven by growth across paid content, advertising, and IP adaptations.
Negative Updates
Widening Net Loss
Net loss of $14.6M in Q2 FY26 compared to a net loss of $3.9M in the prior-year quarter, primarily driven by higher income tax expense and elevated marketing investments.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue and Constant-Currency Growth
Reported revenue of $339.0M in Q2 FY26; down 2.8% year-over-year on a reported basis but up 5.2% on a constant currency basis driven by growth across paid content, advertising, and IP adaptations.
Read all positive updates
Company Guidance
For Q3 FY26 management guided constant‑currency revenue growth of 0.7%–3.3%, implying revenue of $358–$368 million (based on current FX), and adjusted EBITDA of $0–$5 million (adjusted EBITDA margin 0%–1.4%), while reiterating an expectation to return to double‑digit revenue growth by the end of the year; for context, Q2 revenue was $339 million (down 2.8% reported, up 5.2% CC) with adjusted EBITDA of $5.5 million (1.6% margin), gross profit $88.1 million (26% gross margin), adjusted EPS $0.04, GAAP net loss $14.6 million (GAAP loss/share $0.11), and cash plus short‑term deposits of about $594 million ($583M cash + $11M deposits).WEBTOON Entertainment Inc Financial Statement Overview
Summary
Income Statement
27
Negative
Balance Sheet
66
Positive
Cash Flow
34
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.37B | 1.38B | 1.35B | 1.28B | 1.08B |
| Gross Profit | 334.48M | 322.18M | 339.07M | 295.49M | 273.01M |
| EBITDA | -345.02M | -353.92M | -113.09M | -96.81M | -82.58M |
| Net Income | -343.92M | -345.93M | -143.91M | -116.45M | -129.87M |
Balance Sheet | |||||
| Total Assets | 1.59B | 1.60B | 1.94B | 1.78B | 2.02B |
| Cash, Cash Equivalents and Short-Term Investments | 583.14M | 581.81M | 598.73M | 251.62M | 279.71M |
| Total Debt | 22.63M | 23.67M | 17.24M | 33.44M | 53.56M |
| Total Liabilities | 368.64M | 367.24M | 378.87M | 429.13M | 505.13M |
| Stockholders Equity | 1.16B | 1.17B | 1.47B | 1.25B | 1.38B |
Cash Flow | |||||
| Free Cash Flow | -4.01M | -6.70M | 4.73M | -7.54M | -161.80M |
| Operating Cash Flow | 6.07M | 11.22M | 17.88M | 14.80M | -140.61M |
| Investing Cash Flow | -23.53M | -7.50M | -17.28M | -51.98M | -50.70M |
| Financing Cash Flow | 34.23M | 1.47M | 353.87M | -6.50M | 350.34M |
WEBTOON Entertainment Inc Risk Analysis
WEBTOON Entertainment Inc disclosed 74 risk factors in its most recent earnings report. WEBTOON Entertainment Inc reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
WEBTOON Entertainment Inc Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $830.39M | 97.52 | 11.42% | ― | 21.99% | 271.66% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
55 Neutral | $277.84M | -14.34 | -8.50% | ― | -2.78% | 72.47% | |
52 Neutral | $344.44M | -0.70 | -110.37% | ― | -13.33% | 45.52% | |
48 Neutral | $11.39M | -0.30 | -106.67% | ― | -34.19% | 40.60% | |
47 Neutral | $1.17B | -3.24 | -27.51% | ― | -0.49% | -238.97% |
* General Sector Average
WBTN
WEBTOON Entertainment Inc
8.51
-7.93
-48.24%
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WEBTOON Entertainment Inc Corporate Events
Business Operations and StrategyFinancial DisclosuresM&A Transactions
WEBTOON Entertainment Reports Q2 Results, Highlights RI Games Deal
Negative
Aug 10, 2026
On August 6, 2026, WEBTOON Entertainment Inc. agreed to purchase up to 9,000 shares of South Korean game developer RI Games Holdings Inc. from Redice Company in a two-step deal totaling KRW 150 billion. RI Games Holdings focuses on games based on...
Executive/Board ChangesShareholder Meetings
WEBTOON Shareholders Approve Directors, Pay and Auditor
Positive
Jun 4, 2026
On June 3, 2026, WEBTOON Entertainment Inc. held its 2026 Annual Meeting of Stockholders, with approximately 95.2% of the company’s voting power represented in person or by proxy, constituting a quorum. Shareholders elected three nominees...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.