[E-Daily Reporter Shin Ha-yeon ] On the 20th, independent research firm Valuefinder assessed that Topco Media(134580)’s AI character chat service, “Toptoon Chat,” is driving improved profitability by overcoming the monetization limitations of its existing webtoon business. The analysis suggests the company is expected to benefit as it leverages existing customers, intellectual property (IP), and payment methods to reduce the cost of acquiring new customers, coupled with policies to block illegal webtoon sites. No investment recommendation or target price was provided.

Jeon Woo-bin, a senior researcher at Value Finder, stated, “We believe the company is currently at the very beginning of a phase in which it is being reevaluated—transitioning from a webtoon distributor to an AI interactive content company based on its own intellectual property (IP).”

Topco Media, established in 2007 and listed on the KOSDAQ market in 2013, is a company that plans, produces, and distributes webtoon content and operates a platform. In 2022, it entered the content business by acquiring the Japanese webtoon distribution division from its parent company, Topco, and in April 2025, it consolidated the entire value chain—including planning, production, distribution, and platform operation—by merging with Toptoon.

In particular, analysts note that the quality of revenue is improving as the share of revenue from its proprietary platform is rising rapidly. The proportion of revenue from the platform rose from 43.8% in 2024 to 69.9% last year and reached 70.4% in the first half of this year. While the distribution division recognizes only a portion of total payment amounts as revenue based on settlement ratios, the platform can recognize the full payment amount based on users’ coin spending, resulting in a relatively more profitable structure.

This shift was also evident in the company’s second-quarter results this year. On a consolidated basis, revenue reached approximately 15.5 billion won, a 30.4% increase from the previous quarter, and operating profit turned positive at approximately 3.7 billion won. Net income also returned to the black at approximately 3.2 billion won. The operating profit margin stood at 23.7%, marking the highest quarterly figure since the merger with Toptoon.

Cost efficiency was also notable. Operating expenses in the second quarter totaled approximately 11.8 billion won, a 0.7% decrease from approximately 11.9 billion won in the same period last year. During the same period, advertising and promotion expenses increased by 11.6% from approximately 1.7 billion won to 1.9 billion won, and commission expenses—which include platform payment fees—also rose from 3.7 billion won to approximately 4.1 billion won.

Research Analyst Jeon explained, “The company increased both revenue and marketing spending while reducing total costs—a typical pattern that occurs when items with significantly lower marginal costs are incorporated into the revenue mix.”

He cited Toptoon Chat, launched last March, as the key driver of improved profitability. Toptoon Chat is a service that uses AI to bring characters from the company’s own webtoon IP to life, enabling one-on-one real-time conversations with users.

While traditional webtoons operate on a model where payment ends once users have finished reading all serialized episodes, AI character chats continue to generate revenue as long as the conversation continues. In fact, while approximately 60% of webtoon paying users spend between 10,000 and 50,000 won per month, about 70% of Toptoon Chat paying users spend 50,000 won or more per month. Since it leverages existing IP, the burden of producing additional content is relatively lower compared to creating new webtoons.

Researcher Jeon stated, “With AI character chat, billing continues as long as the conversation continues, and the upper limit is determined not by content inventory but by user engagement and willingness to pay.” He added, “Considering the improvement in profitability relative to revenue growth in the second-quarter results, it appears that Toptoon Chat’s contribution to revenue has begun to be partially reflected.”

Another strength is the ability to seamlessly transition existing Toptoon users to Toptoon Chat. The company integrated the coin systems of Toptoon and Toptoon Chat last May. Users can use the coins they’ve topped up to view webtoons for conversing with AI characters, unlocking illustrations, and advancing storylines—all without the need for separate registration or payment procedures.

Researcher Jeon noted, “This is not a business focused on attracting new users, but rather one aimed at expanding the ‘share of wallet’ among users who already have a payment history,” adding, “Since it directly inherits existing customers, IPs, and payment methods, it is easily accessible to users.”

The government’s policy to block the distribution of illegal webtoons was also cited as a positive factor. Since last May, the Ministry of Culture, Sports and Tourism has implemented a system for the emergency blocking and access restriction of illegal sites. ValueFinder analyzed that the more a small-to-medium-sized webtoon platform relies on paid transactions, the more likely it is that the effects of reduced illegal distribution will be directly reflected in its financial performance.

Overseas expansion of the AI business is also underway. Topco Media launched Toptoon Chat in Taiwan and Japan last May and in the North American market in July. This strategy is seen as a way to boost average revenue per paying user (ARPPU) while reducing the burden of additional development by leveraging existing proprietary platforms and local user bases.

Researcher Jeon emphasized, “In an environment where acquiring new users has become increasingly difficult, the relative appeal of the company’s model—which can drive up ARPPU—is expected to rise,” adding, “We believe the company has laid the groundwork to be reevaluated not merely as a webtoon company but as an AI content company in the future.”