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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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Q1 2026 guidance assumes flat revenue growth as the company completes infrastructure projects in Japan and laps specific advertising headwinds in the Korean market.
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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.
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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.
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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.
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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.
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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.
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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.
