Management attributed positive MPU growth to the successful deployment of AI-driven personalization tools, which increased content discovery and user engagement by providing more relevant title recommendations.
The 3.9% constant currency revenue growth for 2025 was supported by expansion across all revenue streams, despite a Q4 slowdown driven by volatility in IP adaptations and specific e-commerce advertising headwinds in Korea.
In Korea, the company achieved a record paying ratio of 15.1% by focusing on deepening engagement within its most mature market through advanced machine learning and content diversity.
The Japan segment maintained its position as the #1 revenue-generating app by focusing on infrastructure investments intended to support future AI-driven recommendation scaling.
Management emphasized the ‘flywheel’ effect where IP adaptations, such as the greenlit ‘Lore Olympus’ series at Amazon MGM Studios, drive top-of-funnel awareness and re-engage users with the core digital comics platform.
The company exercised significant cost discipline in G&A and marketing to deliver positive adjusted EBITDA of $19.4 million for the full year, despite reporting a net loss driven by non-cash goodwill impairments primarily related to Wattpad.
Management projects a return to double-digit year-over-year revenue growth by the end of 2026, driven by a recovery in paid content and the stabilization of advertising trends.
The strategic agreement with Disney includes the launch of an all-new digital comics platform by the end of 2026, which WEBTOON will build and operate to leverage Disney’s vast content library.
Q1 2026 guidance assumes flat revenue growth as the company completes infrastructure projects in Japan and laps specific advertising headwinds in the Korean market.
The company plans to launch at least one original series in collaboration with Disney in 2026, moving beyond the 12 reformatted titles already introduced to the platform.
Future margin expansion is expected to be driven by cross-border content distribution efficiencies and the scaling of higher-margin advertising products in the Rest of World markets.
A significant net loss of $336.5 million in Q4 was primarily due to a goodwill impairment charge, with the majority of the impact attributed to the Wattpad business unit.
Management flagged a 10 percentage point temporary increase in Wattpad MAU due to automated web traffic in non-core markets, though they noted this had no material impact on financial performance or app-based metrics.
Advertising revenue in Korea was negatively impacted by a decline in spending from specific e-commerce partners, highlighting a concentration risk within the domestic ad segment.
IP adaptation revenue remains inherently volatile due to milestone-based recognition, as evidenced by the 29.7% decline in Q4 despite 35.5% growth for the full year.
