Aug 6, 2026, 4:12 PM ETConsumer Cyclical

Funko, Inc. — Second Quarter 2026 Earnings Summary

FNKOFUNKO INC

Financial Performance

Net sales increased 7% year-over-year to $207.7 million in Q2 2026, compared to $193.5 million in Q2 2025.
Gross profit was $117.6 million, representing a gross margin of 56.6%, up from $62.0 million (32.1% margin) in the prior year period.
SG&A expenses decreased to $79.7 million from $82.3 million, improving as a percentage of sales to 38.4% from 42.5%.
Net income was $15.4 million ($0.27 per diluted share), a turnaround from a net loss of $40.5 million ($0.74 per diluted share) in Q2 2025.
Adjusted net income was $15.0 million ($0.26 per diluted share), compared to an adjusted net loss of $26.7 million ($0.48 per diluted share) in the prior year.
Adjusted EBITDA was $40.9 million, a significant improvement from negative Adjusted EBITDA of $16.5 million in Q2 2025.
Q2 2026 financial results included a pre-tax benefit of $25.4 million related to the recognition of expected tariff refunds and the release of accrued tariffs.
Total debt decreased by $24.2 million to $201.1 million at June 30, 2026, from $225.3 million at December 31, 2025.
Cash and cash equivalents were $40.7 million at June 30, 2026, down from $42.1 million at December 31, 2025.
Inventories increased to $88.8 million at June 30, 2026, from $83.1 million at December 31, 2025.
Net cash provided by operating activities was $23.6 million for the six months ended June 30, 2026, compared to net cash used of $44.4 million in the same period in 2025.

Full-year 2026 net sales guidance is reiterated at flat to up 3% year-over-year.
Full-year 2026 gross margin guidance is raised to 46%-47%, including the $25.4 million Q2 tariff-related benefit, up from the previous 41%-43% range.
Full-year 2026 Adjusted EBITDA guidance is raised to $100 million-$110 million, including the $25.4 million Q2 tariff-related benefit, up from the previous $70 million-$80 million range.
Third quarter 2026 net sales guidance is approximately flat year-over-year.
Third quarter 2026 gross margin guidance is approximately 43%-44%.
Third quarter 2026 Adjusted EBITDA guidance is $25 million to $30 million.
Management expects full-year 2026 equity-based compensation of approximately $13 million, depreciation and amortization of approximately $60 million, and interest expense of approximately $20 million.
Management expects third quarter 2026 equity-based compensation of approximately $4 million, depreciation and amortization of approximately $15 million, and interest expense of approximately $5 million.

Core Collectibles net sales grew 9% year-over-year to $171.6 million, compared to $157.5 million in Q2 2025.
Loungefly net sales decreased 1.7% year-over-year to $31.3 million, compared to $31.8 million in Q2 2025.
Other category net sales increased 15.2% year-over-year to $4.8 million, compared to $4.1 million in Q2 2025.
The company is rationalizing Loungefly's SKU count to concentrate the assortment behind products with stronger demand and return potential.
Broad-based point-of-sale momentum was reported across theatrical, anime, gaming, and sports categories.
New product launches included rapid-response releases around live cultural moments and the launch of POP! Mystery.

United States net sales grew 3.4% year-over-year to $121.8 million.
Europe net sales grew 19.4% year-over-year to $69.0 million.
Other International net sales decreased 5.1% year-over-year to $16.9 million.
Management indicated progress in identifying fan demand and scaling products through channels with the strongest economics.

Risks include impacts from economic downturns, changes in the retail industry, and risks associated with international operations, including tariffs and trade restrictions.
Risks relate to indebtedness, including the ability to comply with financial and negative covenants under the Credit Agreement.
Risks include dependence on content development by third parties and the ability to obtain, maintain, and protect intellectual property rights.
Risks include fluctuations in gross margin and seasonal impacts, as well as dependence on vendors and outsourcers.
Risks include the influence of significant stockholder TCG and the possibility of conflicting interests with other stockholders.
Risks include the Tax Receivable Agreement (TRA) which confers benefits upon TRA Parties that will not benefit Class A common stockholders to the same extent.

Management described Q2 as a "strong quarter" with sales growth above the high end of the guidance range.
Management stated that "Make Culture Pop!" is becoming a "more deliberate and disciplined growth engine."
Management highlighted improvements in business quality through tighter assortments, better SKU productivity, and continued cost discipline.
Management noted that the company is getting better at turning fan demand signals into distinctive and repeatable products.

In Q2, the company executed a participation sale of $22.1 million in tariff claims for $19.2 million.
Half of the proceeds from the tariff claim sale were used to pay down the company's term loan.
The company hosted a webcast conference call on August 6, 2026, to discuss results and business updates.
The press release includes reconciliations of non-GAAP financial measures (Adjusted Net Income and Adjusted EBITDA) to GAAP net income.