From intimate independent workshops to global co-productions and award-winning features, 2025 proved to be a paradoxical year for India’s animation industry, creatively vibrant yet economically challenging. Studios large and small pushed boundaries across formats, technologies and markets, even as they weathered financial headwinds, shifting client expectations, and tectonic changes brought on by artificial intelligence (AI). One sentiment that stood out across the industry was resilience.
The latest Ficci-EY report titled, “Shape the future: Indian media and entertainment is scripting a new story” revealed that the sector witnessed a 19 per cent decline the previous year. Hence, 2025 was all about surviving the difficult times while attaining achievable milestones one by one. If 2025 was the year of reinvention, the coming year is shaping up to be the year of impact.
To understand the views of the animation industry and get a sneak peak of their year’s performance, AnimationXpress got in touch with the heads of various companies:
Annual progress or milestones achieved
For Mumbai-based Vaibhav Studios, 2025 delivered both creative highs and emotional lows.
On the commercial side, the studio rolled out a series of distinctive campaigns- from Talking Cookies for Britannia Chunkies and Dancing Towers for Vodafone Idea to the creation of the brand mascot for Tata Play. They also designed and produced the trailer for a new animated IP by the studio’s friend Rohin Kathula. Their flagship series Lamput scored its second International Emmy nomination, spotlighting India’s homegrown ingenuity on a global stage.
A major internal milestone was the studio’s first-ever in-house stop-motion workshop, drawing participants from across the country. This was a new chapter in its 25-year contribution to animation education.
With global partnerships and a diverse slate of high-value projects, Toonz Media Group had a productive year. They have grown into an integrated ecosystem of 500 people in India and 400+ across other geographies, supported by 11 offices around the world and a distribution reach that extends to over 200 countries.
Toonz Media Group’s large-scale partnerships and high-profile productions includes: Tiny Head, their co-production with Gamond Animation, France; Hangry Petz, created in partnership with Jay@Play has already gained remarkable traction on YouTube; Witch Detective, co-produced with Method Animation and their much awaited full-length animated feature Pierre the Pigeon Hawk co-produced with Ja3kman Productions and Exodus Film Group. The studio earned recognition for some of the original shows developed by their in-house teams- Issa’s Edible Adventures, Adventures of Rusty, and Paddy Paws. They further expanded their slate with bold, innovative content, including an animated horror anthology in collaboration with Robot Playground Media.
Exploring the surging demand for anime, Toonz entered into a significant partnership with one of Japan’s leading animation studios. Additionally, they joined hands with New-Gen Universe and Ketchup Entertainment for an exciting series based on the New-Gen Nanobot Heroes and another meaningful partnership this year was with MVP Kids.
For Charuvi Design Labs (CDL), 2025 was a year defined by creative breadth. The studio worked on their short film Narasimha Awakens – Legend of Prahlad, delivered multiple immersive films (including the overall experience design), and executed several large art installations. They currently engage about 60 artists at their main office in Gurugram.
“Over the next 12 months, we will be looking to establish a second office within India,” revealed CDL founder and creative director Charuvi Agrawal.
The current year served as a milestone year for Assemblage Entertainment- ambitious, globally collaborative, and packed with meaningful wins.
The studio delivered three major animated features: Sneaks, DreamWorks’s Gabby’s Dollhouse: The Movie, and Stitch Head. They also contributed to Netflix series Wolf King, which went on to earn both Annie and multiple Children’s & Family Emmy Awards nominations.
Another major highlight was the addition of top-tier Mikros talent to their team, bringing in global experience, fresh creative energy, and strengthening Assemblage Entertainment’s ability to deliver at a world-class level.
For Studio Eeksaurus, 2025 was filled with creative fulfillment, personal milestones, and landmark recognition. The major projects done by the studio included- Desi Oon, a commercial for Cadbury Milkinis and The Aurobindo Five Dreams project.
Founder Suresh Eriyat also experienced a once-in-a-lifetime moment, meeting Hayao Miyazaki while serving on the jury at the Tokyo Anime Awards Festival. “The year also brought major recognitions: the Annecy Jury Cristal, an AICP Award, and the first-ever inclusion of an Indian film in the MoMA archives, along with nearly 30 festival wins. All of this made 2025 a year filled with creative and emotional validation,” Eriyat shared.
With 25 creatives in Mumbai and a presence in Kochi, Eeksaurus is producing four independent director-led films, nurturing original voices internally.
Talking about the annual milestones achieved, PunToon Kids founder and CEO Sourabh Kumar shared, “We increased our episode release frequency by 20 per cent and expanded into producing longer-format videos. Additionally, we launched two major initiatives in 2025: the PunToon Kids Games App and our offline IP, The Rising Rooks- Kids Chess Championship. We successfully completed six editions of the championship this year, receiving an overwhelming response from parents and children.”
The studio operates with a team of 45–50 full-time members in their Mumbai office, supported by additional 10–12 freelancers and consultants who work remotely.
PunToon Kids’ collaborations with mall chains across India brought thousands of children into workshops and cultural programs. Their YouTube brand partnerships with Duolingo, FirstCry, Bumtums, and Gritzo strengthened content value.
Dominant trends & technology
According to Agrawal, the strongest trend they observed was the growing Indian appetite for animation- a sign, they believe, of the industry entering its commercial growth phase. There is also a clear focus on moving towards lower-cost software and especially towards AI which, while still largely a slot-machine like tool, is being adopted widely.
Toonz Media Group observed that 2025 has been a year of profound shifts across the animation and entertainment ecosystem, in content, technology, production workflows, and global market behaviour. These are the various trends that marked the year:
- AI is the year’s biggest disruptor, a creative enabler that boosts efficiency, expands possibilities, and supports the need for speed and scale. Studios that use it smartly will shape the next storytelling era.
- Gen Alpha and Gen Z now set global entertainment trends, demanding content that’s fast, fresh, interactive, and relatable. Adapting to their tastes is essential to stay relevant.
- Production pipelines must accelerate. Traditional workflows are too slow for today’s rapid cycles. Short-form, digital-first, snackable content dominates, making speed and agility critical.
- Global markets are recovering, pushing digital-first strategies forward. IP must live as immersive, multi-platform universes across screens and formats to reach audiences everywhere.
Moving further, Eriyat pointed out that the success of Mahavatar Narasimha and the strong response to the Baahubali animated trailer show that audiences are increasingly open to Indian stories in animation, a shift that could significantly uplift the entire ecosystem.
PunToon Kids’ Kumar too mentioned that AI reshaped animation production in 2025 by speeding up storyboarding, asset creation, and clean-ups, allowing studios to create more content quickly and experiment with new styles without higher costs. At the same time, global studios increasingly embraced co-productions, collaborating across regions to develop culturally diverse kids’ content and expand their reach.
He also pointed out that parents gravitated toward meaningful, culturally rooted Indian stories and sought safer, more controlled platforms for their children. In response, platforms pushed “safe for kids” content, while broadcasters and OTT players commissioned more Indianised IPs reflecting festivals, values, and everyday life. New kids-only OTT services offering curated, ad-free experiences, along with the growing demand for gamified formats- games, quizzes, and interactive learning further shaped the evolving kids’ content landscape.
Challenges that cut across studios
“This year brought a unique set of challenges for us,” noted Toonz Media Group former CEO P. Jayakumar. The most demanding aspect has been the sheer velocity at which technology is shifting. Tools and workflows that were cutting-edge a few quarters ago quickly become outdated. For an animation studio operating at a global scale, this means constantly reinventing how we work while continuing to deliver uncompromised quality.”
Furthermore, the global market remained tight, with strong demand but smaller budgets, slower commissioning, and more cautious partners, pushing Toonz to prioritise long-term value projects over short-term opportunities. Also, scaling production required careful resource balancing, leading them to restructure pipelines, adopt smarter digital tools, and build flexible teams that maintain efficiency without overburdening talent.
Developing original IP remains a major ambition for Indian studios but is highly capital-intensive, leading them to rely on international partnerships and co-productions to share risk, enhance creativity, and reach global markets. Ultimately, adaptability enabled them to overcome these challenges- diversifying revenue models, strengthening pipelines with emerging technologies, and investing in continuous team upskilling to ensure Toonz continues to thrive despite a complex year.
The challenges for CDL were less about technology or the volume of work coming in, since they focus mostly on IP building and retaining complete creative control. “Our real challenge lies in growing the studio by finding very good talent. By that, I mean artists who are trained across verticals, including fine arts, performing arts, filmmaking, and more,” Agrawal said.
To address this, they expanded their recruitment network, though the search continues.
Vaibhav Studios attained remarkable milestones, yet behind these wins, it was a year of profound strain. Budget cuts across broadcasters, industry-wide financial slowdown, and the rapid adoption of lower-cost AI alternatives led to a sharp dip in commissioned work.
“Our film Return of the Jungle is ready,” Kumaresh said, “but reaching it to our audience is the real challenge.” Despite it all, perseverance defines their path ahead.
For Eriyat and the team, AI was the biggest challenge at the start of the year. “We began with anxiety about how AI might affect our processes and identity. But over time, it shifted from a source of fear to a meaningful tool and eventually a capable creative accomplice. We learned to use it thoughtfully, supporting our directors and artists without ever compromising the human core of our work.”
This year PunToon Kids faced severe revenue drops, nearly 80 per cent due to impact of Children’s Online Privacy Protection Act (Coppa) on monetisation. Unpredictable YouTube algorithms and rising production costs, added further strain. To cope with rising production costs and navigating a competitive market with shrinking budgets, the studio responded with diversification across gaming app ecosystems, offline IPs, mall activations, brand partnerships, automation and hybrid AI-human workflows.
Current projects and 2026 plans
Vaibhav Studios’ Return of the Jungle is now slated for a nationwide theatrical release in summer 2026, with audio mixing and censor certification underway. They are also raising funds for print and advertising campaigns. The promotions will kick off early 2026.
Toonz Media Group is gearing up for the global release of Pierre the Pigeon Hawk. Along with that, two of their high-profile series, Witch Detective and Tiny Head, are also on track for completion in the coming year. Also, several of their development projects are scheduled to move into full-fledged production. The studio is also looking forward to major enhancements across the production ecosystem, from pipeline modernisation to deeper integration of emerging tools, including AI-assisted workflows.
Also, Toonz Media Group’s long-standing chief executive officer Jayakumar stepped down from his role after a tenure of over 26 years leading the company, effective 30 November 2025.
CDL is looking ahead to advance their work in the high-end animation space with more shows, expanding their immersive films and spaces vertical, and focusing on creating new verticals. They will continue to work on short films as well.
According to the Assemblage Entertainment team, 2026 is shaping up to be a year defined by clarity over speed. Their next year’s focus will be refining real-time and stylised animation pipelines; strengthening the global footprint; and prioritising projects with creative depth, not just volume.
Studio Eeksaurus is driven by a clear dream: to make Indian stories globally popular and to make Indian audiences fall in love with Indian animation even more than Bollywood, next year. “A large part of 2026 will involve searching for funding and partnerships that align with this mission. Creating pathbreaking films will continue to remain central to our work,” Eriyat added.
For PunToon Kids, 2026 is set to be a year of expansion and innovation with a focus on strengthening its multi-platform ecosystem. Their priority will be scaling the PunToon Kids Games App with more games, interactive experiences, structured learning modules, and new digital comics, while exploring fresh monetisation models to reduce dependence on YouTube.
They will significantly expand offline IPs. The Rising Rooks- Kids Chess Championship will reach more cities, aiming to become a national learning-driven property. The studio is also building new offline experiences – events, festivals, and themed zones to help kids connect with characters in real life and strengthen its omni-channel presence.
For the industry as a whole, the new year promises to be a year of reinvention, opportunity, and accelerated growth. As these studios step into 2026, one thing is clear, India’s animation ecosystem is no longer just participating in the global conversation, it is shaping it.
With theatrical releases, global co-productions, AI-augmented pipelines, and more original Indian stories ready to take flight, 2026 promises- higher creative stakes, bolder storytelling, smarter production, and a more confident, globally present Indian animation identity.
