TOONMEDIUM SIGNALFINANCIAL10-K

Kartoon Studios reported revenue growth of 21% but net losses widened as the company continues executing its content production and distribution strategy amid declining balance sheet strength.

The company shows operational progress with meaningful revenue expansion and substantially higher gross profit margins, suggesting improved monetization of its animated content portfolio. However, widening net losses and a 25% decline in stockholders' equity indicate continued cash consumption and potential financing pressures that investors should monitor closely.

Comparing 2026-03-31 vs 2025-03-31View on EDGAR →
FINANCIAL ANALYSIS

The company demonstrated solid top-line growth with revenue increasing 21% to $39.4M while gross profit roughly doubled, indicating improved operational leverage in content monetization. Operating losses narrowed modestly to $12.9M, but net losses widened to $24.5M, reflecting non-operating costs that offset operational improvements. The balance sheet contracted with total assets declining 17% and stockholders' equity falling 25%, suggesting ongoing cash consumption that may require attention to capital structure sustainability.

FINANCIAL STATEMENT CHANGES
Gross Profit
P&L
+96.1%
$426K→$835K

Gross profit expanding — improving pricing power or product mix shift toward higher-margin offerings.

Capital Expenditure
Cash Flow
+29.1%
$117K→$151K

Capex increased 29.1% — ongoing investment in capacity or infrastructure for future growth.

Stockholders Equity
Balance Sheet
-25.1%
$35.0M→$26.2M

Equity decreased 25.1% — buybacks or losses reducing book value, monitor solvency ratios.

Operating Income
P&L
+24%
-$17.0M→-$12.9M

Operating income improving — cost discipline or growing revenue base absorbing fixed costs.

Revenue
P&L
+20.7%
$32.6M→$39.4M

Revenue growing 20.7% — solid top-line momentum, watch margins for quality of growth.

Accounts Receivable
Balance Sheet
-19.6%
$12.0M→$9.6M

Receivables declined — improved collection efficiency or conservative revenue recognition.

Net Income
P&L
-18.3%
-$20.7M→-$24.5M

Net income declined 18.3% — review whether driven by operations, interest costs, or non-recurring items.

Total Assets
Balance Sheet
-17%
$85.5M→$70.9M

Total assets contracted 17% — asset sales, write-downs, or balance sheet optimization underway.

Total Liabilities
Balance Sheet
-11.5%
$49.0M→$43.4M

Liabilities reduced 11.5% — deleveraging improves balance sheet strength and financial flexibility.

LANGUAGE CHANGES
NEW — 2026-03-31
PRIOR — 2025-03-31
ADDED
As of March 31, 2026, the registrant had 56,336,035 shares of common stock outstanding.
(formerly, Genius Brands International, Inc.) (the Company, Kartoon Studios, we, us or our ) is a global content and brand management company focused on the creation, production, licensing, and distribution of multimedia animated content for children.
Led by experienced industry personnel, the Company s core business includes original intellectual property ( IP ) development, third-party IP production services, media agency, and content monetization through licensing and owned distribution platforms.
Kartoon Studios owned and produced titles include Stan Lee s Superhero Kindergarten (starring Arnold Schwarzenegger), Llama Llama (starring Jennifer Garner), Rainbow Rangers , KC!
The Company s library also includes titles such as Baby Genius , Thomas Edison s Secret Lab , Warren Buffett s Secret Millionaires Club , Team Zenko Go!
The Company maintains a strategy of leveraging owned IP and third-party relationships to expand distribution and consumer product licensing.
( Wow ), through which the Company operates Mainframe Studios - one of the largest animation production studios globally.
Mainframe Studios is a producer-for-hire for several major streaming platforms and IP holders.
To date, Mainframe has produced over 1,200 television episodes, 70 movies, and 3 feature films, including titles such as Barbie Dreamhouse Adventures , Octonauts: Above Beyond , Cocomelon , SuperKitties , It s Andrew!, and Unicorn Academy , in partnership with leading global media companies.
Frederator operates a leading animation-focused creator network, Channel Frederator Network, on YouTube encompassing over 2,500 channels.
REMOVED
As of March 31, 2025, the registrant had 47,784,964 shares of common stock outstanding.
Reverse Stock Split On February 10, 2023, we effected a 1-for-10 reverse stock split of our outstanding shares of common stock.
Unless noted, all references to shares of common stock and per share amounts contained in this Annual Report on Form 10-K have been retroactively adjusted to reflect a 1-for-10 reverse stock split.
Summary of Risk Factors We are providing the following summary of the risk factors contained in this Annual Report on Form 10-K to enhance the readability and accessibility of our risk factor disclosures.
We encourage you to carefully review the full risk factors contained in this Annual Report on Form 10-K in their entirety for additional information regarding the material factors that make an investment in our securities speculative or risky.
These risks and uncertainties include, but are not limited to, the following: Risks Relating to our Business We have incurred net losses since inception.
The value of our investments is subject to significant capital markets risk related to changes in interest rates and credit spreads as well as other investment risks, which may adversely affect our results of operations, financial condition or cash flows.
Changes in the United States, global or regional economic conditions could adversely affect the profitability of our business.
Protecting and defending against intellectual property claims may have a material adverse effect on our business.
Any additional future acquisitions or strategic investments may not be available on attractive terms and would subject us to additional risks.
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