Webtoon is thought of as the future of comics, but their model is not one which has proven financially solvent so far as they’ve reported massive fourth quarter and year-end losses for 2024 after their company’s IPO.
The site Webtoon is a mobile-friendly comics site that allows creators to reach audiences. They’ve created a cottage industry where the site reaches around 85.6 million users based on the content posted. Several creators have garnered large fanbases where they make money through Webtoon revenue sharing on advertising and through use of Patreons and other crowdfunding attached to the site.
In June 2024, Webtoon announced their initial public offering with the site getting listed on the stock exchange at a price of $21 per share, but the price almost immediately dropped in half to $12 per share. As of this writing, Webtoon is sitting at a price of $9.27.
Much of this is due to the company’s financial woes, which began being reported in Q2 2024 with the IPO. Their first quarterly report posted a loss for the company, followed by a small gain in Q3, but the end of the year brought them back in the negative.
The company lost approximately $153 million in Q4 2024, which is up from $33 million in Q4 2023, posting a full year loss of $214 million up from $135 million in 2023.
Much of their losses came from asset writedowns and currency conversions, with their assets losing $70 million and the conversion costs to foreign currency contributing to $62 million, leaving $21 million in other losses posted by the company on the year.
The company blames a lot of the assets on one-time IPO-related costs and aggressive marketing to get more creators on the platform.
Users note in recent years, Webtoon seems to have gotten more desperate to try to monetize their site, which has created a worse user experience. There are ads above every Webtoon stack which promote “treasure hunts,” where users get coins to spend on the site by signing up for brand email lists and watching more ads.
While they had a “Fastpass” situation where users could read ahead on monetized webtoons to pay creators in advance of the rest of the public, now users don’t have to have coins but can watch ads to get it, and some now have discounted coin prices where readers watch 30 seconds of ads to increase ad revenue.
On top of this, they’ve introduced tipping to the website, encouraging creators to get their readers to do so by having an incentive-based leaderboard to do so.
None of this has brought the site to profitability, though Reddit users have noticed the changes to the site not being positive and have posited that Webtoon is on its way down.
Meanwhile, competitor Arkhaven Comics has reached over 16 million views on its website, running without ads and quietly being built entirely on user support. With Webtoon’s functionality getting more difficult to use, the environment seems ripe for a competitor to take over as the leader in web comics
.What do you think of Webtoon’s financials and their site functionality? Leave a comment and let us know.
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Since it's more or less impossible to sign up for Arkhaven and it's backend is so hard to use that they give you a users manual, I don't see it exploding anytime soon. Tapas and the other manga places will likely take up the slack from webtoons. Substack could swoop in and start hosting comics, but seeing as the site is held together with bubblegum and wishful thinking, I doubt that will happen.
Webtoon thinks comics are made instantly if an artist just concentrates for a moment, and punishes you for the absolute triumph of publishing daily.