Funko Reports Second Quarter 2025 Financial Results
Everett, WA — Funko reported its consolidated financial results for the second quarter ended June 30, 2025.
Second Quarter Financial Results Summary: 2025 vs 2024
- Net sales were $193.5 million compared with $247.7 million
- Gross profit was $62.0 million, equal to gross margin of 32.1%, compared with $104.0 million, equal to gross margin of 42.0%
- SG&A expenses were $82.3 million. This compares with $77.9 million, which included a non-recurring net benefit of $1.5 million. Details related to the non-recurring charges can be found in footnotes 3 and 4 of the attached reconciliation tables
- Net loss was $41.0 million, or $0.74 per share, compared with net income of $5.4 million, or $0.10 per share
- Adjusted net loss* was $26.7 million, or $0.48 per share*, compared to adjusted net income* of $5.6 million, or $0.10 per diluted share*
- Negative adjusted EBITDA* was $16.5 million versus adjusted EBITDA* of $27.9 million
“As expected, our 2025 second quarter performance was impacted by a dynamic and uncertain tariff environment,” said Mike Lunsford, Interim Chief Executive Officer of Funko. “Looking ahead, we expect headwinds to moderate and our business to improve as a result of the actions we’ve taken to cut costs, diversify product sourcing and adjust prices. The team is focused on stabilizing the business, accelerating execution on growth initiatives and unlocking Funko’s long-term potential.”
Second Quarter 2025 Net Sales by Category and Geography
The tables below show the breakdown of net sales on a brand category and geographical basis (in thousands):
|
|
Three Months Ended June 30, |
|
Period Over Period Change |
|||||||||||
|
|
2025 |
|
2024 |
|
Dollar |
|
Percentage |
|||||||
|
Net sales by brand category: |
|
|
|
|
|
|
|
|||||||
|
Core Collectible |
$ |
157,477 |
|
$ |
186,738 |
|
$ |
(29,261 |
) |
|
(15.7 |
)% |
||
|
Loungefly |
|
31,847 |
|
|
|
41,483 |
|
|
|
(9,636 |
) |
|
(23.2 |
)% |
|
Other |
|
4,145 |
|
|
|
19,436 |
|
|
|
(15,291 |
) |
|
(78.7 |
)% |
|
Total net sales |
$ |
193,469 |
|
|
$ |
247,657 |
|
|
$ |
(54,188 |
) |
|
(21.9 |
)% |
|
|
Three Months Ended June 30, |
|
Period Over Period Change |
|||||||||||
|
|
2025 |
|
2024 |
|
Dollar |
|
Percentage |
|||||||
|
Net sales by geography: |
|
|
|
|
|
|
|
|||||||
|
United States |
$ |
117,874 |
|
$ |
163,021 |
|
$ |
(45,147 |
) |
|
(27.7 |
)% |
||
|
Europe |
|
57,784 |
|
|
|
60,382 |
|
|
|
(2,598 |
) |
|
(4.3 |
)% |
|
Other International |
|
17,811 |
|
|
|
24,254 |
|
|
|
(6,443 |
) |
|
(26.6 |
)% |
|
Total net sales |
$ |
193,469 |
|
|
$ |
247,657 |
|
|
$ |
(54,188 |
) |
|
(21.9 |
)% |
Balance Sheet Highlights – At June 30, 2025 vs December 31, 2024
- Total cash and cash equivalents were $49.2 million at June 30, 2025 compared with $34.7 million at December 31, 2024
- Inventories were $101.3 million at June 30, 2025 up from $92.6 million at December 31, 2024
- Total debt was $256.6 million at June 30, 2025 versus $182.8 million at December 31, 2024. Total debt includes the amount outstanding under the company’s term loan facility, net of unamortized discounts, revolving line of credit and equipment finance loan.
Outlook for 2025
The Company’s current outlook includes the anticipated impact of the most recent tariff rates. However, it does not account for any further tariff actions, as the impacts of such actions remain uncertain.
The Company provided comments on the following expectations regarding its outlook for the second half of 2025, as follows:
- Financial performance to improve compared with the first half;
- Net sales to be down high single-digits compared with the second half of 2024;
- Adjusted EBITDA margin to be in the mid- to high single-digits range; and,
- Q4 results to ramp up over Q3.
|
Funko, Inc. Condensed Consolidated Statements of Operations (Unaudited) |
|||||||||||||||
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2025 |
|
2024 |
|
2025 |
|
2024 |
||||||||
|
|
(In thousands, except per share data) |
||||||||||||||
|
Net sales |
$ |
193,469 |
|
|
$ |
247,657 |
|
|
$ |
384,208 |
|
|
$ |
463,356 |
|
|
Cost of sales (exclusive of depreciation and amortization) |
|
131,429 |
|
|
|
143,609 |
|
|
|
245,297 |
|
|
|
273,036 |
|
|
Selling, general, and administrative expenses |
|
82,259 |
|
|
|
77,897 |
|
|
|
167,066 |
|
|
|
163,492 |
|
|
Depreciation and amortization |
|
14,528 |
|
|
|
15,419 |
|
|
|
29,790 |
|
|
|
30,998 |
|
|
Total operating expenses |
|
228,216 |
|
|
|
236,925 |
|
|
|
442,153 |
|
|
|
467,526 |
|
|
(Loss) income from operations |
|
(34,747 |
) |
|
|
10,732 |
|
|
|
(57,945 |
) |
|
|
(4,170 |
) |
|
Interest expense, net |
|
4,522 |
|
|
|
5,081 |
|
|
|
8,371 |
|
|
|
11,392 |
|
|
Other expense (income), net |
|
887 |
|
|
|
(557 |
) |
|
|
1,055 |
|
|
|
996 |
|
|
(Loss) income before income taxes |
|
(40,156 |
) |
|
|
6,208 |
|
|
|
(67,371 |
) |
|
|
(16,558 |
) |
|
Income tax expense |
|
848 |
|
|
|
789 |
|
|
|
1,692 |
|
|
|
1,689 |
|
|
Net (loss) income |
|
(41,004 |
) |
|
|
5,419 |
|
|
|
(69,063 |
) |
|
|
(18,247 |
) |
|
Less:net (loss) income attributable to non-controlling interests |
|
(514 |
) |
|
|
304 |
|
|
|
(985 |
) |
|
|
(699 |
) |
|
Net (loss) income attributable to Funko, Inc. |
$ |
(40,490 |
) |
|
$ |
5,115 |
|
|
$ |
(68,078 |
) |
|
$ |
(17,548 |
) |
|
|
|
|
|
|
|
|
|
||||||||
|
(Loss) earnings per share of Class A common stock: |
|
|
|
|
|
|
|
||||||||
|
Basic |
$ |
(0.74 |
) |
|
$ |
0.10 |
|
|
$ |
(1.26 |
) |
|
$ |
(0.34 |
) |
|
Diluted |
$ |
(0.74 |
) |
|
$ |
0.10 |
|
|
$ |
(1.26 |
) |
|
$ |
(0.34 |
) |
|
Weighted average shares of Class A common stock outstanding: |
|
|
|
|
|
|
|
||||||||
|
Basic |
|
54,362 |
|
|
|
52,107 |
|
|
|
53,948 |
|
|
|
51,406 |
|
|
Diluted |
|
54,362 |
|
|
|
52,605 |
|
|
|
53,948 |
|
|
|
51,406 |
|
|
Funko, Inc. Condensed Consolidated Balance Sheets (Unaudited) |
|||||||
|
|
June 30, 2025 |
|
December 31, 2024 |
||||
|
|
(In thousands, except per share data) |
||||||
|
Assets |
|
|
|
||||
|
Current assets: |
|
|
|
||||
|
Cash and cash equivalents |
$ |
49,151 |
|
|
$ |
34,655 |
|
|
Accounts receivable, net |
|
99,963 |
|
|
|
119,882 |
|
|
Inventories |
|
101,344 |
|
|
|
92,580 |
|
|
Prepaid expenses and other current assets |
|
37,315 |
|
|
|
39,942 |
|
|
Total current assets |
|
287,773 |
|
|
|
287,059 |
|
|
Property and equipment, net |
|
72,658 |
|
|
|
78,357 |
|
|
Operating lease right-of-use assets, net |
|
51,252 |
|
|
|
52,846 |
|
|
Goodwill |
|
133,989 |
|
|
|
133,652 |
|
|
Intangible assets, net |
|
143,758 |
|
|
|
151,547 |
|
|
Other assets |
|
5,479 |
|
|
|
3,793 |
|
|
Total assets |
$ |
694,909 |
|
|
$ |
707,254 |
|
|
Liabilities and Stockholders’ Equity |
|
|
|
||||
|
Current liabilities: |
|
|
|
||||
|
Line of credit |
$ |
145,000 |
|
|
$ |
60,000 |
|
|
Current portion of long-term debt |
|
108,849 |
|
|
|
22,512 |
|
|
Current portion of operating lease liabilities |
|
18,516 |
|
|
|
17,102 |
|
|
Accounts payable |
|
66,514 |
|
|
|
63,130 |
|
|
Accrued royalties |
|
46,396 |
|
|
|
61,362 |
|
|
Accrued expenses and other current liabilities |
|
64,221 |
|
|
|
81,688 |
|
|
Total current liabilities |
|
449,496 |
|
|
|
305,794 |
|
|
Long-term debt |
|
2,756 |
|
|
|
100,303 |
|
|
Operating lease liabilities |
|
56,103 |
|
|
|
60,390 |
|
|
Other long-term liabilities |
|
4,477 |
|
|
|
4,414 |
|
|
|
|
|
|
||||
|
Commitments and Contingencies |
|
|
|
||||
|
|
|
|
|
||||
|
Stockholders’ equity: |
|
|
|
||||
|
Class A common stock, par value $0.0001 per share, 200,000 shares authorized; 54,530 and 52,967 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively |
|
5 |
|
|
|
5 |
|
|
Class B common stock, par value $0.0001 per share, 50,000 shares authorized; 648 and 1,430 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively |
|
— |
|
|
|
— |
|
|
Additional paid-in-capital |
|
351,587 |
|
|
|
343,472 |
|
|
Accumulated other comprehensive income (loss) |
|
6,437 |
|
|
|
(1,676 |
) |
|
Accumulated deficit |
|
(176,860 |
) |
|
|
(108,782 |
) |
|
Total stockholders’ equity attributable to Funko, Inc. |
|
181,169 |
|
|
|
233,019 |
|
|
Non-controlling interests |
|
908 |
|
|
|
3,334 |
|
|
Total stockholders’ equity |
|
182,077 |
|
|
|
236,353 |
|
|
Total liabilities and stockholders’ equity |
$ |
694,909 |
|
|
$ |
707,254 |
|
|
Funko, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) |
|||||||
|
|
Six Months Ended June 30, |
||||||
|
|
2025 |
|
2024 |
||||
|
|
(In thousands) |
||||||
|
Operating Activities |
|
|
|
||||
|
Net loss |
$ |
(69,063 |
) |
|
$ |
(18,247 |
) |
|
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |
|
|
|
||||
|
Depreciation and amortization |
|
29,790 |
|
|
|
30,998 |
|
|
Equity-based compensation |
|
6,377 |
|
|
|
7,100 |
|
|
Other, net |
|
1,301 |
|
|
|
641 |
|
|
Changes in operating assets and liabilities: |
|
|
|
||||
|
Accounts receivable, net |
|
24,572 |
|
|
|
8,385 |
|
|
Inventories |
|
(5,761 |
) |
|
|
10,102 |
|
|
Prepaid expenses and other assets |
|
5,529 |
|
|
|
28,599 |
|
|
Accounts payable |
|
3,207 |
|
|
|
10,528 |
|
|
Accrued royalties |
|
(14,967 |
) |
|
|
(2,325 |
) |
|
Accrued expenses and other liabilities |
|
(25,427 |
) |
|
|
(15,386 |
) |
|
Net cash (used in) provided by operating activities |
|
(44,442 |
) |
|
|
60,395 |
|
|
|
|
|
|
||||
|
Investing Activities |
|
|
|
||||
|
Purchases of property and equipment |
|
(16,211 |
) |
|
|
(13,261 |
) |
|
Sale of Funko Games inventory and certain intellectual property |
|
— |
|
|
|
6,754 |
|
|
Other, net |
|
970 |
|
|
|
518 |
|
|
Net cash used in investing activities |
|
(15,241 |
) |
|
|
(5,989 |
) |
|
|
|
|
|
||||
|
Financing Activities |
|
|
|
||||
|
Borrowings on line of credit |
|
85,000 |
|
|
|
— |
|
|
Payments on line of credit |
|
— |
|
|
|
(30,500 |
) |
|
Payments of long-term debt |
|
(11,530 |
) |
|
|
(19,644 |
) |
|
Other, net |
|
193 |
|
|
|
859 |
|
|
Net cash provided by (used in) financing activities |
|
73,663 |
|
|
|
(49,285 |
) |
|
|
|
|
|
||||
|
Effect of exchange rates on cash and cash equivalents |
|
516 |
|
|
|
(23 |
) |
|
|
|
|
|
||||
|
Net change in cash and cash equivalents |
|
14,496 |
|
|
|
5,098 |
|
|
Cash and cash equivalents at beginning of period |
|
34,655 |
|
|
|
36,453 |
|
|
Cash and cash equivalents at end of period |
$ |
49,151 |
|
|
$ |
41,551 |
|
The following tables reconcile the Non-GAAP Financial Measures to the most directly comparable U.S. GAAP financial performance measure, which is net (loss) income, for the periods presented:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|||||||||||||
|
|
2025 |
|
2024 |
|
2025 |
|
2024 |
||||||||
|
|
(In thousands, except per share data) |
||||||||||||||
|
Net (loss) income attributable to Funko, Inc. |
$ |
(40,490 |
) |
|
$ |
5,115 |
|
|
$ |
(68,078 |
) |
|
$ |
(17,548 |
) |
|
Reallocation of net (loss) income attributable to non-controlling interests from the assumed exchange of common units of FAH, LLC for Class A common stock(1) |
|
(514 |
) |
|
|
304 |
|
|
|
(985 |
) |
|
|
(699 |
) |
|
Equity-based compensation(2) |
|
3,112 |
|
|
|
3,276 |
|
|
|
6,377 |
|
|
|
7,100 |
|
|
Acquisition costs and other expenses(3) |
|
— |
|
|
|
(1,605 |
) |
|
|
— |
|
|
|
1,579 |
|
|
Certain severance, relocation and related costs(4) |
|
— |
|
|
|
101 |
|
|
|
— |
|
|
|
1,967 |
|
|
Foreign currency transaction loss (gain)(5) |
|
1,463 |
|
|
|
(563 |
) |
|
|
1,639 |
|
|
|
1,013 |
|
|
Income tax expense (benefit)(6) |
|
9,743 |
|
|
|
(1,065 |
) |
|
|
16,531 |
|
|
|
2,914 |
|
|
Adjusted net (loss) income |
$ |
(26,686 |
) |
|
$ |
5,563 |
|
|
$ |
(44,516 |
) |
|
$ |
(3,674 |
) |
|
Adjusted net (loss) income margin(7) |
|
(13.8 |
)% |
|
|
2.2 |
% |
|
|
(11.6 |
)% |
|
|
(0.8 |
)% |
|
Weighted-average shares of Class A common stock outstanding – basic |
|
54,362 |
|
|
|
52,107 |
|
|
|
53,948 |
|
|
|
51,406 |
|
|
Equity-based compensation awards and common units of FAH, LLC that are convertible into Class A common stock |
|
749 |
|
|
|
2,473 |
|
|
|
907 |
|
|
|
2,350 |
|
|
Adjusted weighted-average shares of Class A stock outstanding – diluted |
|
55,111 |
|
|
|
54,580 |
|
|
|
54,855 |
|
|
|
53,756 |
|
|
Adjusted (loss) earnings per diluted share |
$ |
(0.48 |
) |
|
$ |
0.10 |
|
|
$ |
(0.81 |
) |
|
$ |
(0.07 |
) |
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2025 |
|
2024 |
|
2025 |
|
2024 |
||||||||
|
|
(amounts in thousands) |
||||||||||||||
|
Net (loss) income |
$ |
(41,004 |
) |
|
$ |
5,419 |
|
|
$ |
(69,063 |
) |
|
$ |
(18,247 |
) |
|
Interest expense, net |
|
4,522 |
|
|
|
5,081 |
|
|
|
8,371 |
|
|
|
11,392 |
|
|
Income tax expense |
|
848 |
|
|
|
789 |
|
|
|
1,692 |
|
|
|
1,689 |
|
|
Depreciation and amortization |
|
14,528 |
|
|
|
15,419 |
|
|
|
29,790 |
|
|
|
30,998 |
|
|
EBITDA |
$ |
(21,106 |
) |
|
$ |
26,708 |
|
|
$ |
(29,210 |
) |
|
$ |
25,832 |
|
|
Adjustments: |
|
|
|
|
|
|
|
||||||||
|
Equity-based compensation(2) |
|
3,112 |
|
|
|
3,276 |
|
|
|
6,377 |
|
|
|
7,100 |
|
|
Acquisition costs and other expenses(3) |
|
— |
|
|
|
(1,605 |
) |
|
|
— |
|
|
|
1,579 |
|
|
Certain severance, relocation and related costs(4) |
|
— |
|
|
|
101 |
|
|
|
— |
|
|
|
1,967 |
|
|
Foreign currency transaction loss (gain)(5) |
|
1,463 |
|
|
|
(563 |
) |
|
|
1,639 |
|
|
|
1,013 |
|
|
Adjusted EBITDA |
$ |
(16,531 |
) |
|
$ |
27,917 |
|
|
$ |
(21,194 |
) |
|
$ |
37,491 |
|
|
Adjusted EBITDA margin(8) |
|
(8.5 |
)% |
|
|
11.3 |
% |
|
|
(5.5 |
)% |
|
|
8.1 |
% |
|
(1) |
Represents the reallocation of net income attributable to non-controlling interests from the assumed exchange of common units of FAH, LLC for Class A common stock in periods in which income was attributable to non-controlling interests. |
|
|
(2) |
Represents non-cash charges related to equity-based compensation programs, which vary from period to period depending on the timing of awards. |
|
|
(3) |
For the three months ended June 30, 2024, includes a net one-time legal settlement gain of $1.4 million related to a previously disclosed Loungefly customs-related matter. For the six months ended June 30, 2024, also includes $3.2 million related to contract settlement agreements and related services for assets held for sale (including fair market value adjustments of $135,000) related to a potential business initiative and the sale of certain assets under Funko Games. |
|
|
(4) |
For the three and months ended June 30, 2024, includes charges related to severance and benefit costs related to certain management departures. |
|
|
(5) |
Represents both unrealized and realized foreign currency gains and losses on transactions denominated other than in U.S. dollars, including derivative gains and losses on foreign currency forward exchange contracts. |
|
|
(6) |
Represents the income tax expense (benefit) effect of the above adjustments including net (loss) income. This adjustment uses an effective tax rate of 25% for all periods presented. |
|
|
(7) |
Adjusted net (loss) income margin is calculated as adjusted net loss as a percentage of net sales. |
|
|
(8) |
Adjusted EBITDA margin is calculated as adjusted EBITDA as a percentage of net sales. |
Related Articles - Toys & Games
