And apparently the episodes do pull in the revenue; when one of the early videos was age restricted (which, to be fair, is fair), Newgrounds offered to host an uncensored version. YouTube instantly un-restricted it and no episode has had a problem since; I imagine this doesn't happen unless you're pulling in revenue. So, yes, adding in ad revenue, Patreon backers and merchandising (plus maybe some leftover A24 money, who are producing/distributing another series, Hazbin Hotel), they may be giving it away for free, but they are still getting paid.
On the other hand, without budget numbers (and, if nothing else, they do look expensive), it's hard to tell just how profitable the series actually is. The confidence that another season will happen shows they aren't paycheck to paycheck, anyway.
And apparently the episodes do pull in the revenue; when one of the early videos was age restricted (which, to be fair, is fair), Newgrounds offered to host an uncensored version. YouTube instantly un-restricted it and no episode has had a problem since; I imagine this doesn't happen unless you're pulling in revenue. So, yes, adding in ad revenue, Patreon backers and merchandising (plus maybe some leftover A24 money, who are producing/distributing another series, Hazbin Hotel), they may be giving it away for free, but they are still getting paid.
On the other hand, without budget numbers (and, if nothing else, they do look expensive), it's hard to tell just how profitable the series actually is. The confidence that another season will happen shows they aren't paycheck to paycheck, anyway.