diff --git a/client/ayon_core/plugins/publish/extract_thumbnail.py b/client/ayon_core/plugins/publish/extract_thumbnail.py
index d1b6e4e0cc..92b544e393 100644
--- a/client/ayon_core/plugins/publish/extract_thumbnail.py
+++ b/client/ayon_core/plugins/publish/extract_thumbnail.py
@@ -21,7 +21,7 @@ from ayon_core.lib.transcoding import VIDEO_EXTENSIONS
 
 
 class ExtractThumbnail(pyblish.api.InstancePlugin):
-    """Create jpg thumbnail from sequence using ffmpeg"""
+    """Create png thumbnail from sequence using ffmpeg"""
 
     label = "Extract Thumbnail"
     order = pyblish.api.ExtractorOrder + 0.49
@@ -197,7 +197,7 @@ class ExtractThumbnail(pyblish.api.InstancePlugin):
             self.log.debug("input {}".format(full_input_path))
 
             filename = os.path.splitext(input_file)[0]
-            jpeg_file = filename + "_thumb.jpg"
+            jpeg_file = filename + "_thumb.png"
             full_output_path = os.path.join(dst_staging, jpeg_file)
             colorspace_data = repre.get("colorspaceData")
 
@@ -260,12 +260,12 @@ class ExtractThumbnail(pyblish.api.InstancePlugin):
 
             new_repre = {
                 "name": repre_name,
-                "ext": "jpg",
+                "ext": "png",
                 "files": jpeg_file,
                 "stagingDir": dst_staging,
                 "thumbnail": True,
                 "tags": new_repre_tags,
-                # If source image is jpg then there can be clash when
+                # If source image is png then there can be clash when
                 # integrating to making the output name explicit.
                 "outputName": "thumbnail"
             }
diff --git a/client/ayon_core/plugins/publish/extract_thumbnail_from_source.py b/client/ayon_core/plugins/publish/extract_thumbnail_from_source.py
index 7751d73335..a5913c2d01 100644
--- a/client/ayon_core/plugins/publish/extract_thumbnail_from_source.py
+++ b/client/ayon_core/plugins/publish/extract_thumbnail_from_source.py
@@ -26,7 +26,7 @@ from ayon_core.lib import (
 
 
 class ExtractThumbnailFromSource(pyblish.api.InstancePlugin):
-    """Create jpg thumbnail for instance based on 'thumbnailSource'.
+    """Create png thumbnail for instance based on 'thumbnailSource'.
 
     Thumbnail source must be a single image or video filepath.
     """
@@ -61,7 +61,7 @@ class ExtractThumbnailFromSource(pyblish.api.InstancePlugin):
         dst_staging, dst_filename = os.path.split(dst_filepath)
         new_repre = {
             "name": "thumbnail",
-            "ext": "jpg",
+            "ext": "png",
             "files": dst_filename,
             "stagingDir": dst_staging,
             "thumbnail": True,
@@ -101,7 +101,7 @@ class ExtractThumbnailFromSource(pyblish.api.InstancePlugin):
 
         self.log.debug("Thumbnail source: {}".format(thumbnail_source))
         src_basename = os.path.basename(thumbnail_source)
-        dst_filename = os.path.splitext(src_basename)[0] + "_thumb.jpg"
+        dst_filename = os.path.splitext(src_basename)[0] + "_thumb.png"
         full_output_path = os.path.join(dst_staging, dst_filename)
 
         if oiio_supported: