TOON · Kartoon Studios Inc.

Kartoon Studios reported Q1 2026 results reflecting continued operational improvement. Total revenue of $7.2 million declined from $9.5 million in the prior year period, primarily due to timing of production deliveries at Mainframe Studios, with several projects shifting to later quarters. However, distribution revenue grew 15% to $2.3 million, driven by increased engagement and monetization on owned streaming platforms Kartoon Channel! and Ameba, which both achieved record paid subscriber levels. Subscriber engagement on Kartoon Channel! rose over 80% year-over-year, while Ameba engagement more than doubled. The company also expanded its content library by licensing Mattel's Masters of the Universe (2002) and American Girl (2016). Operating expenses declined 20% to $10.0 million, reflecting cost discipline as the company moves beyond its peak investment phase. General and administrative expenses fell 10% to $5.1 million. As a result, loss from operations narrowed 9% to $2.8 million. Management highlighted progress on flagship franchises Hundred Acre Wood and Stan Lee Universe, which are advancing toward market introduction with broadcast partners to be announced. The company ended the quarter with $6.0 million in cash and marketable securities and stockholders' equity of $22.6 million. The results indicate that Kartoon Studios is transitioning to an IP-driven growth model, with improving operating leverage and a focus on higher-margin revenue streams.