Why Did Solo Leveling's Studio Lose $1.2 Million Despite Breaking Records?

How Can A-1 Pictures Face Financial Crisis While Creating the World's Most-Watched Anime?

I need to tell you something that might surprise you about the anime industry. The studio that created Solo Leveling just lost over a million dollars, even though their show became the biggest hit on Crunchyroll.

Let me explain what happened to A-1 Pictures and why this matters for anime fans everywhere.

The Shocking Financial Reality

A-1 Pictures reported a net loss of 178 million yen (about $1.2 million) for the fiscal year ending March 2025. This came as a complete shock because:

• The previous year, they made a profit of 24 million yen
• This represents their biggest loss in ten years
• Solo Leveling became Crunchyroll's most-watched anime of all time

I find this situation fascinating because it shows how the anime business really works behind the scenes.

Solo Leveling's Record-Breaking Success

Before we dive into the financial problems, let me show you just how successful Solo Leveling became:

Streaming Achievements

• Became Crunchyroll's most-rated anime with over 610,000 user ratings
• Surpassed One Piece and Demon Slayer in popularity
• Maintained a 4.9-star average rating

Awards Recognition

• Won 9 awards at the 2025 Crunchyroll Anime Awards
• Claimed the top prize: Anime of the Year
• First Korean animation to win both the highest honor and most awards

The show's success was undeniable. So why did the studio lose money?

The Real Reason Behind the Loss

I want you to understand how anime production actually works. A-1 Pictures operates under what we call the "production committee model."

Here's what likely happened:

Budget Overruns

• Aniplex (the parent company) set a production budget
• A-1 Pictures exceeded this budget to maintain quality
• The studio had to cover the difference from their own funds

Profit Distribution

• Sony and Aniplex receive most profits from streaming and merchandise
• A-1 Pictures only gets their contracted production fee
• Studios rarely share in the massive profits their shows generate

This explains why even the most successful anime can leave studios struggling financially.

Sony's Financial Performance Context

To put this in perspective, let me show you Sony's overall performance. Sony's Pictures segment, which includes anime operations, reported:

• Total sales of 1.5 trillion yen for fiscal 2025
• Operating income of 117.3 billion yen
• Crunchyroll contributed significantly to revenue growth

The parent company is thriving while the actual animation studio faces losses.

Industry-Wide Problem

This situation isn't unique to A-1 Pictures. I've seen this pattern across the anime industry:

• Studios work on tight margins with fixed budgets
• They don't receive streaming or merchandise revenue shares
• Production costs often exceed initial budgets
• Quality demands require expensive talent and resources

What This Means for Fans

You might worry about how this affects future anime quality. Here's what I think:

Short-term Impact

• A-1 Pictures will continue operating normally
• Sony has the resources to support the studio
• Solo Leveling Season 3 production won't be affected

Long-term Concerns

• This model makes studios vulnerable to financial stress
• Talented animators may seek better opportunities elsewhere
• The industry needs structural changes to support creators better

A-1 Pictures' Track Record

Despite this setback, A-1 Pictures remains one of Japan's premier animation studios. They've created:

• Sword Art Online series
• Fairy Tail
• Kaguya-sama: Love is War
• Your Name (co-production)

Their expertise and reputation in the industry remain strong.

Looking Forward

I believe this financial loss highlights important issues in anime production. While fans celebrate Solo Leveling's success, the people who actually created it face financial challenges.

The anime industry needs to find better ways to:

• Share profits with production studios
• Provide realistic budgets for high-quality animation
• Support the talented artists who bring these stories to life

For now, A-1 Pictures will continue creating amazing anime with Sony's backing. But this situation shows us that success in anime isn't always shared equally among all the people who make it possible.

The next time you watch Solo Leveling or any anime, remember the dedicated artists working behind the scenes who often sacrifice financial stability to bring these incredible stories to life.