How is anime as a whole profitable? (If it is) I'm considering the following facts:


Japanese people have few spare time, with their jobs taking a lot of their time usually, even kids or teenagers have intense schedules.
There are lots of anime series each year, we can easily expect at least 100  series with maybe an average of 20 chapters per each series.
Most anime don't get out of Japan, even if we consider either worldwide legal or illegal services that offer anime, what is seen most are the most well-known series.
Anime is not cheap to produce, we can consider that each anime episode is about 120000 US dollars.
Anime is pretty time consuming to watch in general.


(I'm making up the previous quantities but I don't think I'm that far from the real ones).

With these facts I wonder how it's profitable in general as my guess is that with those conditions most series would not cover their costs, so it looks somehow strange that people are willing to spend much in something that's hardly going to be profitable (although if the anime is successful and moreover, exported worldwide, it can be truly profitable, that's true, maybe it's just that with their big hits they cover all the rest of the unsuccessful series).

I thought that maybe it was subsidized by the government but with an internet search it looks like this doesn't happen often.

What is missing or faulty in my reasoning, or is anime really profitable? Maybe it's what I've said earlier that their successful series cover the costs of the unsuccessful series?

On the other hand, could it be that it's not usually profitable but they still try to do it just because anime is so big in Japan and they love it?
Merchandise, DVD &amp; Blu-ray sales. If the predicted net profit from the sales of Merchandise, DVD &amp; Blu-ray is low then some studios will hire freelancers. For example, Madhouse is known for hiring Freelancers.

Some studios are already powerful and big enough such that they could themselves invest certain amount of money in the anime rather than the production committee giving them a budget. Thus they would get a larger chunk of profit. Example, Kyoto Animation and Sunrise studios.

Some studios are directly owned by big and well known production committee members who have produced not only anime but also video games, soundtracks, merchandise &amp; food companies. All of which can act as a source of money for the production of a anime.
Example, A1 Studios -&gt; Aniplex -&gt; which in turn is owned by the Sony Music Entertainment Japan.

International licensing.

Finally, some anime may perform poorly initially, but, several years later they might do well in the international market or during the re-runs. By which the studio and the production committee can get back their lost money. Remember how Gundam 0079 had very low ratings initially? Or how Serial Experiments Lain was a flop in Japan but not so much in US? Or how Ghost Stories utterly failed in Japan but did comparatively well in US?


Point is, even if some shows don't make profit in the initial run, doesn't mean they will always not make a profit later on.