WEBTOON Q2 revenue beats expectations

Overview

• WEBTOON Q2 revenue rises 8.5%, beating analyst expectations, per LSEG data

• Adjusted EPS for Q2 beats consensus, despite net loss of $3.9 mln

• Company announces strategic collaboration with Disney for iconic comics

Outlook

• WEBTOON expects Q3 revenue growth of 9.4%-12.2% on constant currency basis

• Company anticipates Q3 revenue between $380 mln and $390 mln, based on current FX rates

• WEBTOON forecasts Q3 adjusted EBITDA of $2 mln-$7 mln

• Company sees Q3 adjusted EBITDA margin of 0.5%-1.8%

Result Drivers

• REVENUE GROWTH - Driven by increases in Paid Content, Advertising, and IP Adaptations

• COST MANAGEMENT - Lower general & administrative expenses contributed to reduced net loss

• APP UPDATES - Recent updates to the webcomic app aimed at increasing user engagement

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the online services peer group is "buy"

• Wall Street's median 12-month price target for Webtoon Entertainment Inc is $11.00, about 16.9% above its August 11 closing price of $9.14

Press Release: ID:nGNX6y2VpF