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Johnny manages to get onto the Internet and sees Daniel's ad for his new dojo. The two dojos choose the local ValleyFest to demonstrate their skills and one-up each other.
Daniel and Johnny both find their own paths to training their students, with Kreese observing Johnny's methods.
Miguel notices the discrepancies in Kreese's stories and goes to Johnny with his suspicions. Daniel wonders how to bring students to Miyagi-do, and Aisha makes a new friend.
Johnny continues building a new life, but a face from his past could disrupt his future. Meanwhile, Daniel opens a Miyagi-Do studio to rival Cobra Kai.