Kartoon Studios, Inc. (NYSE American: TOON) today
announced its streaming service business, which premiered in June
2020, has achieved record revenue, increased its paid subscribers,
expanded its international market coverage and reached break-even
EBITDA in the fourth quarter of 2024.
Kartoon Channel! has steadily grown to become a pre-eminent
children’s entertainment destination that delivers thousands of
episodes of carefully curated, and family-friendly content. In
2023, paid subscribers increased 19% over 2022, in contrast to a
number of streaming services that have been experiencing declines.
Importantly, free trials, a leading indicator for future growth,
more than doubled in Q4 2023 compared to the same period in
2022.
Kartoon Studios’ streaming business recently hit break-even for
the latest quarter, a notable accomplishment among streaming
services, many of which have struggled with losses. In addition,
the Company has successfully reduced its customer acquisition costs
by 50% from the first half to the second half of 2023, driving
bigger margins through improved media efficiency and a successful
content strategy.
Kartoon Studios CEO, Andy Heyward stated, “In
3½ years, the growth of the Kartoon Studios’ streaming business in
the U.S. and globally has been impressive. Even Netflix took many
years to reach break-even. We challenged our leadership to learn
from its practices and to surpass it. Not only have we already
reached EBITDA break-even, but we are now experiencing solid
growth, as we see consumers responding to the Kartoon Channel!’s
brand of age-appropriate children’s content and the easy to
navigate interface.”
Heyward continues: “We attribute the growth to the quality of
the curated content, and most importantly to the leadership of the
management of the channels, led domestically, by Toon Media
Networks’ President Todd Steinman, and internationally by President
of Kartoon Channel! Worldwide Paul Robinson, former Managing
Director of Disney Channel Worldwide. I feel we have some of the
brightest and most talented executives in the global content
distribution and OTT/Streaming business. Combining expanding market
reach, growing revenue, and quality of service based on our Apple
app store user ratings, we believe our streaming services will be
an important component of Kartoon Studios’ growth strategy for
years to come.”
In the Apple app store, Kartoon Channel! continues to sustain a
top rating, 4.9 out of 5 stars, outperforming major competitors,
including Netflix, YouTube Kids, and Disney+.
Kartoon Channel! has firmly established itself as a top-tier
entertainment destination for children, featuring content such as
Stan Lee’s Superhero Kindergarten, Rainbow Rangers, Peppa Pig
Shorts, Barney, Kidaverse Roblox Rumble, Llama Llama, Super Simple
Songs, Melodee’s, Finny the Shark, Angry Birds, Yu-Gi-Oh! and more.
The service has reached nearly 100% penetration of U.S. television
households and is available across a broad range of platforms,
including iOS, Android Mobile, Web, Amazon Prime Video, Apple TV,
Android TV, Amazon Fire, Roku, Tubi, Pluto TV, Xumo, Comcast, Cox,
Dish, Sling TV, Samsung and LG Smart TVs.
Todd Steinman, President of Toon Media
Networks, who oversees the Company’s Kartoon Channel!,
Ameba, and Frederator Networks, stated, “We are humbled by the
positive feedback our services are receiving in the market from
both children and parents. This is best evidenced by our subscriber
growth and the significant increase in new trials.”
Internationally, Kartoon Channel is poised to increase market
penetration. Concurrently, Kartoon Channel! branded
blocks are available daily across Europe, Middle East, Africa, and
Latin America. Kartoon Channel! is currently available in Africa
and Sub-Sahara Africa (StarTimes), India (Jio), Australia and New
Zealand (Samsung TV Plus), Germany (Waipu), Philippines (Tap TV),
Malaysia (Astro), Vietnam (BHD Cineplex), Indonesia (Linknet),
United Arab Emirates (Etisalat), Mongolia (Mobinet), and Maldives
(SSNet).
Paul Robinson, President of Kartoon Channel! & Head
of International Distribution, concluded: “We
continue to expand our international footprint with new Kartoon
Channel! launches. We have ambitious plans for the first half of
2024, which includes expansion into new territories that we
anticipate would bring our reach to a combined population of over
1.8 billion people. The high-quality original productions,
brand name titles and movies appeal to parents, caregivers and
children across different continents and cultures, and we could not
be more excited about the international growth of the
business.”
About Kartoon Studios Kartoon Studios (NYSE
AMERICAN: TOON) is a global end-to-end creator, producer,
distributor, marketer, and licensor of entertainment brands. The
Company’s IP portfolio includes original animated content,
including the Stan Lee brand, Stan Lee’s Superhero
Kindergarten, starring Arnold Schwarzenegger, on Kartoon Channel!
and Ameba; Shaq’s Garage, starring Shaquille O’Neal, on
Kartoon Channel!; Rainbow Rangers on Kartoon Channel! and
Ameba; the Netflix Original, Llama Llama, starring Jennifer
Garner, and more.
In 2022, Kartoon Studios acquired Canada’s WOW! Unlimited Media
and made a strategic investment becoming the largest shareholder in
Germany’s Your Family Entertainment AG (FRA:RTV), one of Europe’s
leading distributors and broadcasters of high-quality programs for
children and families.
Toon Media Networks, the company’s wholly owned digital
distribution network, consists of Kartoon Channel!, Frederator
Network, and Ameba. Kartoon Channel! is a globally distributed
entertainment platform with near full penetration of the U.S.
market. Kartoon Channel! and Ameba are available across multiple
platforms, including iOS, Android Mobile, Web, Amazon Prime Video,
Apple TV, Amazon Fire, Roku, Pluto TV, Comcast, Cox, Dish, Sling
TV, Android TV, Tubi, Xumo, and Samsung and LG Smart TVs.
Frederator Network owns and operates one of the largest global
animation networks on YouTube, with channels featuring over 2000
exclusive creators and influencers, garnering billions of views
annually.
Forward Looking Statements: Certain statements
in this press release constitute "forward-looking statements"
within the meaning of the federal securities laws. Words such as
"may," "might," "will," "should," "believe," "expect,"
"anticipate," "estimate," "continue," "predict," "forecast,"
"project," "plan," "intend" or similar expressions, or statements
regarding intent, belief, or current expectations, are
forward-looking statements. While the Company believes these
forward-looking statements are reasonable, undue reliance should
not be placed on any such forward-looking statements, which are
based on information available to us on the date of this release.
These forward looking statements are based upon current estimates
and assumptions and are subject to various risks and uncertainties,
including without limitation, our ability to generate revenue or
achieve profitability; our ability to obtain additional financing
on acceptable terms, if at all; the potential issuance of a
significant number of shares, which will dilute our equity holders;
fluctuations in the results of our operations from period to
period; general economic and financial conditions; our ability to
anticipate changes in popular culture, media and movies, fashion
and technology; competitive pressure from other distributors of
content and within the retail market; our reliance on and
relationships with third-party production and animation studios;
our ability to market and advertise our products; our reliance on
third-parties to promote our products; our ability to keep pace
with technological advances; our ability to protect our
intellectual property and those other risk factors set forth in the
“Risk Factors” section of the Company’s most recent Annual Report
on Form 10-K and in the Company's subsequent filings with the
Securities and Exchange Commission (the "SEC"). Thus, actual
results could be materially different. The Company expressly
disclaims any obligation to update or alter statements whether as a
result of new information, future events or otherwise, except as
required by law.
MEDIA
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INVESTOR RELATIONS
CONTACT:
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Photos accompanying this announcement are available at:
https://www.globenewswire.com/NewsRoom/AttachmentNg/861b9991-ec9b-4b2d-baab-45b64bc7ae09
https://www.globenewswire.com/NewsRoom/AttachmentNg/237370d0-0fcf-4ebe-bf7c-6fa6c81e812d
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