Anime: Balancing Demand and Difficulties

The anime market outside of Japan grew a record 26% in 2024, according to an October 2025 report from the Association of Japanese Animations (AJA). This extends a period of growth for the anime market (beyond Japan) that has been ongoing since 2012. Revenue growth for the Japanese market, meanwhile, was just 2.8% in 2024, and total revenue from overseas markets recently surpassed the total for the domestic Japanese market. These trends continued into 2025 by all accounts. 

The bulk of anime is still produced in Japan and, despite the continued expansion in global demand, the industry is facing significant challenges:  

• Studios tend to be unprofitable, with most of the proceeds from their productions going to the companies that finance their projects. Teikoku Databank, a financial analyst, tracked eight studio closures in the first nine months of 2025, tied for the most failures during that period over the last decade. And less than half of studios have reported increases in profits over the past couple of years, even as topline revenues have been robust. Many studios are taking steps such as turning to AI or outsourcing productions (through contracted or proprietary offshore studios) to regions with more inexpensive labor. Some are also looking into global co-productions to improve their financial picture, something that has not traditionally been the norm in Japan. 

• Animators in Japan receive much lower average wages than their counterparts in the U.S. or elsewhere, despite very long working hours. The Nippon Animation & Film Culture Association (NAFCA) found that 40% of workers in 2023 earned less than 2.4 million yen (about $25,000), compared to $49,200 for the average Japanese worker across all industries. Studios also rely heavily on freelancers that command even lower fees and receive no benefits. NAFCA is working on certifications meant to standardize skills, promote living wages for entry-level roles, and expand labor availability.

• There are significant labor shortages, putting pressure on animators, studios, and the industry and raising questions about whether the fast pace of growth is sustainable. The AJA survey found that 310 anime series were produced in Japan in 2024, the highest number ever recorded. Fewer than 6,000 trained animators are employed by the industry — not a large number for that output. 

• Due to the long hours and the pressure to crank out a lot of content quickly, animators tend to get burnt out, some to the point of ending up in the hospital or worse. Some studios, especially the larger ones and those who work with international distributors or coproducers, have been taking steps to improve working conditions. And a Freelance Law created by the Japan Fair Trade Commission came into force in November 2024. It requires that freelancers have contracts, outlines pay terms, mandates timely payments, and bars unpaid overtime. 

• Complaints are on the rise, especially from fans and pundits in Japan, about the quality of the anime being produced, with labor shortages, cost-cutting, and the huge volume of work all contributing. Some of the complaints include that the work tends to be derivative, lacking in interesting storytelling and artwork, or too often rooted in manga or other franchise IP.

• The industry is struggling with the role of AI. As noted, some studios are turning to AI for cost-cutting and enhanced efficiencies. But when studios have used AI for some early tasks, such as dubbing, they have received backlash from fans. The AJA, Japan Cartoonists Association, and 17 publishers have also come out against the use of certain AI tools, mainly on copyright grounds. Studios are awaiting the release of several tools developed in Japan that are touted as assisting rather than replacing human animators. 

Despite these challenges, the Japanese Ministry of Economy, Trade, and Industry has big goals for anime and related content, especially abroad. It wants exports of anime to grow from 2.1 trillion yen (about $13.2 billion) in 2024 to 6 trillion yen ($37.8 billion) in 10 years, representing 186% growth over the period. In addition, it wants video games to go from exports of 3.4 trillion yen to 12 trillion yen ($21.4 billion to $75.6 billion) and manga to increase from $0.3 trillion yen to 1 trillion yen ($1.9 billion to $6.3 billion), representing increases of 253% and 233%, respectively. It plans to support this expansion with some financing that will help recipients decrease their reliance on commercial funders and allow them to retain more of the profits. 

Whether the industry can achieve these robust projections, which are part of the government’s “New Cool Japan Strategy,” remains to be seen.

While all of these challenges are worrisome for the health of the anime business in Japan, and ultimately globally, the pace of licensing deals involving anime and manga has not slowed to date. To name just a few recent examples touching on the U.S. market, BoxLunch marked its 10th anniversary in January with shop-in-shops in 10 stores featuring a range of manga-themed products (one of its top-selling categories) from Mag.Net, whose properties include Frieren: Beyond Journey’s End, Inuyasha, Ranma 1/2, and Uzumaki; U.K.-based agency Reemsborko signed an agreement to represent the Ghost in the Shell franchise globally outside of Asia; and Jakks Pacific has been leaning into anime and manga over the past few months, launching a new anime division in February, followed by announcements of deals with Crunchyroll for a variety of properties, Kodansha for Attack on Titan and Gachiakuta, and Viz Media for Naruto. 

Even as demand for anime remains healthy around the world, it is worth keeping an eye on industry trends in Japan for their potential impact on supply and demand in the U.S. and other global territories.  

A reminder that Raugust Communications’ monthly e-newsletter goes out tomorrow, May 19, 2026. The Licensing Topic of the Month will look at a new use for crowdfunding in the licensing business, while the Datapoint research spotlight will examine the exhibitors at this year’s Licensing Expo and what the breakdown says about the licensing landscape. If you do not yet receive this free publication, you can subscribe here.