Funko (NASDAQ:FNKO) Releases Quarterly Earnings Results, Beats Expectations By $0.06 EPS

Funko (NASDAQ:FNKO) issued its quarterly earnings data on Thursday. The company reported $0.16 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.10 by $0.06, FiscalAI reports. The business had revenue of $258.34 million for the quarter, compared to analysts’ expectations of $250.70 million. Funko had a return on equity of 6.63% and a net margin of 0.49%.

Here are the key takeaways from Funko’s conference call:

• Q3 sales and profitability improved: Net sales rose 3%, led by 5% growth in core collectibles and 12% growth in Europe. Gross margin expanded five percentage points to 45%, and adjusted EBITDA was $32 million, or a 12% margin.
• Debt declined: Funko ended the quarter with $42 million in cash and $155 million in net debt, down from just over $200 million a year earlier.
• Point-of-sale units were weaker in Q3: Reported global POS units fell 4% year over year, including a 10% decline in the U.S.; D2C units fell 13% amid reduced promotions. EMEA POS rose 16%, and global POS was up 3% year to date; management said last year’s post-tariff inventory shipments made the U.S. comparison tougher.
• Full-year guidance was reiterated: The company maintained its outlook for sales to be flat to up 3% and adjusted EBITDA of $100 million to $110 million.
• New products and sales channels showed early traction: Management said Pop! Mystery products sold three times faster than expected and reached 100% sell-through, with more launches planned. It also highlighted tests of live selling and auctions, while noting these are developing opportunities rather than established revenue drivers.

Funko Trading Up 9.6%

NASDAQ FNKO traded up $0.59 during trading hours on Friday, hitting $6.72. 2,165,211 shares of the company were exchanged, compared to its average volume of 994,451. The stock has a 50-day moving average price of $6.09 and a 200 day moving average price of $5.18. The company has a quick ratio of 0.79, a current ratio of 1.16 and a debt-to-equity ratio of 0.97. Funko has a 52 week low of $2.72 and a 52 week high of $7.35. The stock has a market cap of $375.85 million, a PE ratio of 30.55 and a beta of 1.00.

Insider Buying and Selling at Funko

In other news, CFO Pendeven Le sold 35,907 shares of Funko stock in a transaction that occurred on Tuesday, September 1st. The stock was sold at an average price of $6.51, for a total value of $233,754.57. Following the completion of the transaction, the chief financial officer owned 35,907 shares in the company, valued at approximately $233,754.57. The trade was a 50.00% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Josh Simon sold 181,893 shares of the business’s stock in a transaction that occurred on Thursday, September 3rd. The shares were sold at an average price of $5.79, for a total value of $1,053,160.47. Following the transaction, the chief executive officer directly owned 151,440 shares in the company, valued at approximately $876,837.60. This represents a 54.57% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold a total of 228,662 shares of company stock worth $1,363,086 over the last ninety days. Company insiders own 3.88% of the company’s stock.

Funko News Summary

Here are the key news stories impacting Funko this week:

• Positive Sentiment: Q3 revenue rose 3% to $258.3 million, topping the roughly $250.7 million consensus, while adjusted earnings were $0.16 per share versus estimates of $0.10. Funko Q3 results
• Positive Sentiment: Gross margin expanded to 45.2% from 40.2% a year earlier, and coverage pointed to core collectibles growth and a leaner Loungefly business. Funko reiterated its full-year net sales and adjusted EBITDA guidance, supporting the view that profitability and cost management are improving. Funko’s Core Collectibles Lead Q3 Growth as Loungefly Gets Leaner
• Neutral Sentiment: FNKO’s post-earnings reaction was volatile: one report noted an initial decline despite the sales beat. The current rebound may reflect investors reassessing the results after that selloff. Funko beats Q3 sales expectations but stock drops
• Negative Sentiment: U.S. sales declined even as overall sales increased, raising a potential concern about domestic demand and leaving regional performance as a risk to monitor. Funko’s U.S. sales decline, overall sales increase

Analyst Ratings Changes

Several equities research analysts recently weighed in on the stock. Seaport Research Partners assumed coverage on shares of Funko in a research report on Monday, August 24th. They issued a “buy” rating and a $8.00 price target on the stock. Weiss Ratings reaffirmed a “sell (d-)” rating on shares of Funko in a research note on Thursday, October 15th. The Goldman Sachs Group reiterated a “neutral” rating and set a $6.75 price objective on shares of Funko in a research report on Monday, August 10th. Wall Street Zen upgraded shares of Funko from a “hold” rating to a “buy” rating in a research report on Saturday, August 15th. Finally, Zacks Research raised shares of Funko to a “hold” rating in a research note on Wednesday, August 26th. One equities research analyst has rated the stock with a Buy rating, two have given a Hold rating and one has assigned a Sell rating to the company’s stock. According to MarketBeat, the company presently has a consensus rating of “Hold” and an average price target of $7.08.

About Funko

Funko, Inc is a consumer products company that designs, sources and sells licensed and original pop-culture collectibles and merchandise. Its best-known product is the Pop! vinyl figure, which features characters from movies, television, video games, sports and other entertainment properties. The company also offers plush products, action figures, accessories, apparel, home goods and games.

Funko’s portfolio includes brands such as Pop!, Loungefly and Mondo. Loungefly focuses on licensed bags, wallets, accessories and other lifestyle products, while Mondo is known for premium collectibles, posters, apparel and related merchandise.