Company Announcements

--Q4 Net Sales Exceed Expectations, Gross Margin and Adjusted EBITDA at High End of Expectations--

EVERETT, Wash.--(BUSINESS WIRE)--Mar. 12, 2026-- Funko, Inc. (Nasdaq: FNKO), a leading pop culture and collectibles brand, today reported its consolidated financial results for the fourth quarter and full year ended December 31, 2025. The company also provided financial guidance for the 2026 first quarter and full year.

Fourth-Quarter Financial Results Summary: 2025 vs 2024

• Net sales were $273.1 million compared with $293.7 million
• Gross profit was $111.6 million, equal to gross margin of 40.9%, compared with $124.4 million, equal to gross margin of 42.4%
• SG&A expenses were $90.9 million compared with $102.8 million
• Net loss was $0.2 million, or $0.00 per share, compared with $1.5 million, or $0.03 per share
• Adjusted net income* was $2.5 million, or $0.05 per diluted share*, compared with $4.4 million, or $0.08 per diluted share*
• Adjusted EBITDA* was $23.3 million compared with $26.3 million

Full-Year Financial Results Summary: 2025 vs 2024

• Net sales were $908.2 million compared with $1.05 billion
• Gross profit was $351.3 million, equal to gross margin of 38.7%. This compares with $434.5 million, equal to gross margin of 41.4%
• SG&A expenses were $337.7 million compared with $359.0 million
• Net loss was $67.4 million, or $1.24 per share, compared with $14.7 million, or $0.28 per share
• Adjusted net loss* was $38.8 million, or $0.70 per diluted share*, versus adjusted net income* of $8.7 million, or $0.16 per share*
• Adjusted EBITDA* was $26.6 million compared with $94.7 million

"We closed the year with two consecutive quarters of solid financial results,” said Josh Simon, Chief Executive Officer of Funko. "Our fourth quarter performance was driven by strong sales of entertainment properties, notably KPop Demon Hunters and Stranger Things, as well as our Bitty Pop! franchise and the launch of Pop! Yourself in Europe.

"Turning to our balance sheet, we reduced our inventory levels and paid down $16 million of debt in Q4. And, as previously announced, we reached an agreement with our lender group to amend our credit agreement, which extends the maturity to December 31, 2027 and provides us with the financial flexibility to deliver on our long-term plans.

"Looking ahead, we’re excited about the 2026 entertainment slate and executing our 'Make Culture POP!' strategy -- winning the moments that shape culture, scaling storytelling across new products and platforms, expanding our touchpoints with fans and driving profitable growth.”

Fourth 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):

Balance Sheet Highlights - At December 31, 2025 vs December 31, 2024

• Total cash and cash equivalents were $42.1 million at December 31, 2025 versus $34.7 million at December 31, 2024
• Inventories were $83.1 million at December 31, 2025 versus $92.6 million at December 31, 2024
• Total debt was $225.3 million at December 31, 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 the company's equipment finance loan

Outlook for 2026

The company provided its 2026 full-year outlook and 2026 first-quarter guidance, which assumes ongoing tariff rates of approximately 15%, as follows:

*Adjusted net income (loss), adjusted net income (loss) per diluted share and adjusted EBITDA are non-GAAP financial measures. For a reconciliation of historical adjusted net income (loss), adjusted income (loss) per diluted share, and adjusted EBITDA, to the most directly comparable U.S. GAAP financial measures, please refer to the “Non-GAAP Financial Measures” section of this press release. A reconciliation of adjusted net income (loss), adjusted net income (loss) per diluted share and adjusted EBITDA outlook to the corresponding GAAP measure on a forward-looking basis cannot be provided without unreasonable efforts, as we are unable to provide reconciling information with respect to certain items. However, for the first quarter of 2026 the company expects equity-based compensation of approximately $4 million, depreciation and amortization of approximately $15 million and interest expense of approximately $5 million. For the full year 2026, the company expects equity-based compensation of approximately $15 million, depreciation and amortization of approximately $60 million and interest expense of approximately $18 million, each of which is a reconciling item to net loss. See "Use of Non-GAAP Financial Measures" and the attached reconciliations for more information.

Conference Call and Webcast

The company will host a webcast at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) today, March 12, 2026, to further discuss its fourth-quarter and full-year results and business update. A live webcast, presentation materials and a replay of the event will be available on the Investor Relations section on the Company’s website at investor.funko.com. The replay of the webcast will be available for one year.

Use of Non-GAAP Financial Measures

This release contains references to non-GAAP financial measures, including adjusted net income (loss), including per share amounts, adjusted EBITDA, adjusted EBITDA margin and adjusted net income (loss) margin, which are financial measures that are not prepared in conformity with United States generally accepted accounting principles (U.S. GAAP). Management uses these measures internally for evaluating its operating performance, for planning purposes, including the preparation of our annual operating budget and financials projections, to assess incentive compensation for our employees, and to evaluate our capacity to expand our business. The company's management believes that the presentation of non-GAAP financial measures provides useful supplementary information regarding operational performance because it enhances an investor's overall understanding of the financial results for the company's core business. Additionally, it provides a basis for the comparison of the financial results for the company's core business between current, past and future periods as they remove the impact of items not directly resulting from our core operations. The company also believes that including adjusted EBITDA and the other non-GAAP financial measures presented in this release is appropriate to provide additional information to investors and help to compare against other companies in our industry. Non-GAAP financial measures have limitations as analytical tools and should be considered only as a supplement to, and not as a substitute for or as a superior measure to, financial measures prepared in accordance with U.S. GAAP. We caution investors that amounts presented in accordance with our definitions of adjusted net income (loss), including per share amounts, adjusted EBITDA and adjusted EBITDA margin may not be comparable to similar measures disclosed by our competitors, because not all companies and analysts calculate these measures in the same manner.

Detailed reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the financial tables following this release.

About Funko

Headquartered in Everett, Washington, Funko is a leading pop culture and collectibles brand. Funko designs, sources and distributes licensed pop culture products across multiple categories, including vinyl figures, action toys, plush, apparel, housewares and accessories for consumers who seek tangible ways to connect with their favorite pop culture brands and characters. Learn more at www.funko.com and follow us on X (Twitter) (@OriginalFunko) and Instagram (@OriginalFunko).

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including statements regarding our product offerings, our strategic plan and speed to market, anticipated financial results, including without limitation, full-year and first-quarter 2026 guidance, equity-based compensation, refinancing of our debt and financial position, and the impact of and anticipated trends in the macroeconomic environment, including tariffs and potential tariff refunds, on the company’s business. These forward-looking statements are based on management’s current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: impacts from economic downturns; changes in the retail industry and markets for our consumer products; risks associated with our international operations, including risk related to tariffs and trade restrictions; risks relating to our indebtedness, including our ability to comply with financial and negative covenants under our Credit Agreement, as amended; our ability to execute our business strategy; our ability to manage our inventories and growth; our ability to identify or complete any strategic alternative transaction; our dependence on content development and creation by third parties; our ability to obtain, maintain and protect our intellectual property rights or those of our licensors; fluctuations in our gross margin and seasonal impacts; our dependence on vendors and outsourcers; risks relating to government regulation; risks relating to litigation, including products liability claims and securities class action litigation; risk resulting from our e-commerce business and social media presence; our ability to successfully operate our information systems and implement new technology; our ability to secure additional financing on favorable terms or at all; the influence of our significant stockholder, TCG, and the possibility that TCG’s interests may conflict with the interests of our other stockholders; risks relating to our organizational structure; including the Tax Receivable Agreement ("TRA") which confers certain benefits upon the parties to the TRA ("TRA Parties") that will not benefit Class A common stockholders to the same extent as it will benefit the TRA Parties; and volatility in the price of our Class A common stock. These and other important factors discussed under the caption “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2025 and our other filings with the Securities and Exchange Commission could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

The following tables reconcile the Non-GAAP Financial Measures to the most directly comparable U.S. GAAP financial performance measure, which is net loss, for the periods presented:

View source version on businesswire.com: https://www.businesswire.com/news/home/20260312671831/en/

Investor Relations:
investorrelations@funko.com

Media:
pr@funko.com

Source: Funko, Inc.