Funko has reported its consolidated financial results for the third quarter ended September 30, 2024. Q3 net sales, gross margin and adjusted EBITDA* (earnings before interest, taxes, depreciation, and amortization) were high end or above expectations.
Q3 financial results summary: 2024 vs 2023
- Net sales were $292.8 million compared with $312.9 million
- Gross profit was $119.8 million, equal to gross margin of 40.9%. This compares with $104.0 million, equal to gross margin of 33.2%, which included $6.4 million of non-recurring charges
- SG&A expenses were $92.7 million, which included $0.4 million of non-recurring charges. This compares with $94.0 million, which included $9.9 million of non-recurring charges. Details related to the non-recurring charges can be found in footnotes 4, 5 and 10 of the attached reconciliations
- Net income was $4.6 million, or $0.08 per diluted share, compared with net loss of $16.2 million, or $0.31 per share
- Adjusted net income* was $8.0 million, or $0.14 per diluted share*, compared to $1.7 million, or $0.03 per share
- Adjusted EBITDA* was $31.0 million versus $25.4 million
Cynthia Williams, Funko CEO, said: “We reported solid financial results for the 2024 third quarter. As expected, net sales were down compared with the prior-year quarter, though in the top end of our guidance range. On the other hand, we delivered better than expected profitability on improved gross margins, as we did in the first two quarters of this year.
“We’ve updated our full-year 2024 outlook for net sales to reflect a more cautious consumer environment, which we began to see in the third quarter. We now expect net sales to be at the low end to slightly below our previous range. Adjusted EBITDA is a different matter, we have raised our full-year outlook to above the high end of the range.
“We are deep in the process of developing our strategic plan for 2025 and beyond, and pleased that we have already begun executing several elements of that plan. Recently, we enabled direct-to-consumer shipping capability to Canada, and we expanded our collaboration with the National Football League (NFL), and its fanbase of more than 200 million, to include the option to customize Pop! Yourself with any NFL team logo. Additionally, and just in time for the holidays, we are announcing that Harry Potter accessories will be available to customize Pop! Yourself beginning tomorrow.”
Regarding the Funko 2024 full-year outlook, the company lowered the range for net sales and raised the range for adjusted EBITDA and provided guidance for its 2024 fourth quarter.
EBITDA = Earnings Before Interest, Taxes, Depreciation, and Amortisation.
Full report here.
