Despite falling stock prices and a net loss during the third quarter, Kartoon Studios Inc. is looking to grow this year with a number of series orders and collaborations planned.
Andrew Heyward, the chief executive of the Beverly Hills creator, distributor and licensor of children’s entertainment brands, said that the company continued to build on the positive results achieved in the first half of the year.
“Revenue for the nine months ending Sept. 30, reached $23.2 million, reflecting a 4% increase in revenue for Q3 2024 from Q2 2024 and a 38% growth for Q2 2024 from Q1 2024,” Heyward said in a statement.
“This growth highlights rising demand for our animated productions through Mainframe Studios, currently our largest revenue-driving unit, as the industry steadily recovers from the disruptions caused by the 2023 Writers Guild of America and Screen Actors Guild strikes,” he added.
With series orders for over 145 episodes and a contracted pipeline secured through 2025 and 2026, Mainframe in Vancouver is positioned for continuing growth, Heyward continued.
Collaborating with partners like Sony Kids, The Walt Disney Co., Spin Master and others, Mainframe attracts clients who demand superior work in animation, he said.
“Their commitment to technical (quality) and innovation, combined with a scalable infrastructure, enables Mainframe to deliver high-quality content at an unprecedented scale,” Heyward said. “This strength is attracting production orders from across the entertainment industry.” Kartoon Studios recently released its third quarter financials.
The company reported on Nov. 14 a net loss of -$2 million (5 cents a share) for the quarter ending Sept. 30, compared to a net loss of -$15.5 million (44 cents) in the same period of the previous year. Revenue dropped by nearly 14% from the third quarter of the prior year to $8.7 million.
Its stock price has lost about 52% of its value since the beginning of last year, when it closed on Jan. 2 at $1.37 and on Dec. 27 when it closed at 66 cents.
The share price closed at 53 cents on Jan. 2.
Redefining its business around proven IP
Kartoon Studios has also redefined its business around three core pillars: Kartoon Channel, Stan Lee Universe and Winnie-The-Pooh, with each providing proven brand equity, and a foundation for growth and global brand expansion in 2025 and beyond, Heyward said.
“In (the third quarter), we achieved meaningful progress across each of the three pillars,” he added.
Kartoon Channel broadened its international footprint by launching first with Samsung Plus across India, UK, and Italy, with a footprint of 1.5 billion potential viewers. Recently, it added Indonesia’s Link Net, giving Kartoon Channel access to nearly 300 million potential viewers in the fourth most populous country in the world.
Kartoon Channel is available across multiple domestic platforms, including Amazon Prime Video, Apple TV, Amazon Fire, Roku and Pluto TV, among others.
In the Stan Lee Universe, the company is releasing “The Excelsiors” as a graphic novel first through Legible Comics in Vancouver, and then following it up with film and television adaptations from Michael Uslan, the executive producer of the “Batman” film franchise.
And, finally, the company announced back in November it had struck a deal with the publicly traded digital media company LiveOne Inc. in Beverly Hills to produce and distribute all the original music from the Winnie-The-Pooh series and films it intends to make.
