After reporting seven consecutive years of financial losses, Studio Kai, the animation house behind the 2026 surprise hit Sentenced to Be a Hero and the latest two seasons of Umamusume: Pretty Derby, may finally be on the brink of insolvency. However, oddly, fans don’t seem too concerned, as they think that its parent company, ADK Holdings, which is owned by South Korean video game publisher Krafton, will ultimately bail them out.
As reported by Gamebiz (via Automaton), Studio Kai’s latest financial earnings report revealed that the anime studio saw a net loss of roughly 248 million yen for its seventh consecutive year, which amounts to roughly $1.5 million. This bumps their total reported net losses up to 565 million yen, which is approximately $3.5 million. According to Gamebiz’s report, this means that Studio Kai “is currently in a state of insolvency.”
Studio Kai started on the back foot in 2019. Before the release of their first anime, Umamusume: Pretty Derby 2nd Season, in January 2021, Studio Kai declared a total net loss of 165 million yen (just over $1 million) in its 2020 fiscal year earnings report. The studio has been slowly accumulating more and more debt with each passing year, and it has never actually reported a profit in the seven years it’s been operating.
The thing is…this doesn’t make any sense. By all accounts, Umamusume: Pretty Derby 2nd Season is—and this is not an exaggeration—one of the best-selling anime Blu-rays of all time. In fact, it was the best-selling anime of 2021 on Blu-ray until the release of Demon Slayer: Kimetsu no Yaiba Mugen Train. Just to put that into perspective for you, Demon Slayer: Kimetsu no Yaiba Mugen Train was the highest-grossing film of 2020. Not in Japan, but worldwide.
Studio KAI reports Financial Loss of $3.5 Million as of December 2025.
'Sentenced to be a Hero' is their Recent Popular Title which was delayed and aired in 2026, with Season 2 being Announced recently. pic.twitter.com/Y7tLs6z23x
— AniTV (@AniTVOfficial) April 13, 2026
The studio has also been going from strength to strength in the past five years, releasing incredibly popular series such as Skeleton Knight in Another World in 2022, the third season of Umamusume: Pretty Derby in 2023, and Sentenced to Be a Hero earlier this year. The second season of Skeleton Knight in Another World is also set to drop in 2026, with the fourth season of Umamusume: Pretty Derby reportedly set to follow it in late 2026/early 2027.
Studio Kai has also just released the first season of The Ramparts of Ice and Snowball Earth, and it has already announced that a second season of Sentenced to Be a Hero is in production. So, what’s going on here? How is Studio Kai supposedly on the verge of insolvency, yet they’ve produced some of the most popular anime of the last decade, and still apparently have enough in the bank to start work on new projects?
Well, fans think it’s pretty simple; Japan apparently has its own spin on Hollywood accounting. “It’s done on purpose to avoid tax. They are doing just fine in reality,” stated one commenter on r/anime. “Their parent company is keeping them afloat with capital injections and they are also the ones who profit the most from the anime committee deals.”
Look, there’s no real way to verify this. I’m pretty sure the Japanese government would have already done something about it if there was. However, I do find it hard to believe that Studio Kai has helmed so many back-to-back smash hits and apparently never generated enough money to move past its initial $1 million reported losses.
Either way, I’m not particularly worried. While valuations for Studio Kai’s parent company, ADK Holdings, vary wildly, the one figure that can be confirmed is that Krafton purchased them for 75 billion yen ($517 million) in 2025. I think ADK probably has enough change stashed behind the couch cushions to bail Studio Kai out (if, indeed, they actually need to be bailed out in the first place).
