Webtoon Entertainment disappointed investors with a weak second-quarter sales forecast that fell short of Wall Street expectations. The digital comics platform projects revenue between $332 million to $342 million, representing growth of just 1.7% to 4.6% on a constant currency basis. Analysts had anticipated $348 million, causing shares to plunge 15% to $11.24 in after-hours trading.

The outlook comes after Webtoon's first-quarter revenue already declined 1.5% to $320.9 million. The company's performance suffered particularly from its IP adaptations segment, which experienced a 23% drop. This weakness in monetizing its comic properties suggests challenges in expanding beyond its core digital readership base and diversifying revenue streams.

Webtoon's tempered growth outlook reflects increasing competition in the digital entertainment space and potential difficulties in monetizing content beyond its platform. The company's narrow revenue growth forecast signals it may need to accelerate new business initiatives or partnerships to regain investor confidence and reignite expansion in the competitive digital comics market.