Funko Reports Strong Second Quarter 2026 Financial Results; Reiterates Full-Year Net Sales Outlook and Raises Adjusted EBITDA Guidance

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--Q2 Net Sales Grew 7%; Core Collectibles Sales Increased 9%; Record Gross Margin;
Adjusted EBITDA Well Above Expectation; Debt Reduced by $15M --

EVERETT, Wash.--(BUSINESS WIRE)-- Funko, Inc. (Nasdaq: FNKO), a leading pop culture lifestyle brand, today reported its consolidated financial results for the second quarter ended June 30, 2026.

Second Quarter Financial Results Summary: 2026 vs 2025

• Net sales increased 7% to $207.7 million, compared with $193.5 million
• Gross profit was $117.6 million, equal to gross margin of 56.6%, compared with $62.0 million, equal to gross margin of 32.1%
• SG&A expenses were $79.7 million compared with $82.3 million, and improved 413 basis points as a percentage of sales to 38.4% from 42.5%
• Net income was $15.4 million, or $0.27 per diluted share, compared with a net loss of $40.5 million, or $0.74 per diluted share
• Adjusted net income* was $15.0 million, or $0.26 per diluted share*, compared with an adjusted net loss* of $26.7 million, or $0.48 per diluted share*
• Adjusted EBITDA* was $40.9 million, compared with negative Adjusted EBITDA* of $16.5 million
• Gross margin, net income, adjusted net income* and adjusted EBITDA* for the second quarter of 2026 each included a pre-tax benefit of $25.4 million related to the recognition of expected tariff refunds and the release of accrued tariffs

“Q2 was a strong quarter for Funko. We delivered 7% sales growth, above the high end of our guidance range. Core Collectibles grew 9%, and gross margin reached a record high for the second consecutive quarter. Together with continued SG&A discipline, that performance drove adjusted EBITDA well above our guidance range.

These results are evidence that Make Culture Pop! is becoming a more deliberate and disciplined growth engine. We are getting better at identifying where fan demand is forming, moving faster to turn those signals into distinctive and repeatable products, and scaling them through the channels with the strongest economics. That progress showed up in broad-based POS momentum across theatrical, anime, gaming and sports, as well as rapid-response releases around live cultural moments and the launch of POP! Mystery.

At the same time, we are improving the quality of the business through tighter assortments, better SKU productivity, continued cost discipline, and concentrating our resources behind the products, fandoms and channels with the greatest demand and return potential.”

Second Quarter 2026 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
	2026			2025			Dollar				Percentage
Net sales by brand category:
Core Collectibles	$	171,641		$	157,477		$	14,164			9.0	%
Loungefly		31,302			31,847			(545	)		(1.7	)%
Other		4,776			4,145			631			15.2	%
Total net sales	$	207,719		$	193,469		$	14,250			7.4	%

	Three Months Ended June 30,						Period Over Period Change
	2026			2025			Dollar				Percentage
Net sales by geography:
United States	$	121,845		$	117,874		$	3,971			3.4	%
Europe		68,976			57,784			11,192			19.4	%
Other International		16,898			17,811			(913	)		(5.1	)%
Total net sales	$	207,719		$	193,469		$	14,250			7.4	%

Balance Sheet Highlights - At June 30, 2026 vs December 31, 2025

• Total cash and cash equivalents were $40.7 million at June 30, 2026 compared with $42.1 million at December 31, 2025
• Inventories were $88.8 million at June 30, 2026 up from $83.1 million at December 31, 2025
• Total debt was $201.1 million at June 30, 2026 versus $225.3 million at December 31, 2025. 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.
• 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 sale were used to pay down the company’s term loan.

Outlook for 2026

The company updated its 2026 full-year outlook to reflect its strong second quarter performance, expected continued growth in Core Collectibles, and its decision to rationalize Loungefly’s SKU count and concentrate the assortment behind products with stronger demand and return potential. The company also provided 2026 third-quarter guidance.

	Current Outlook
2026 Full Year
Net Sales	Reiterating net sales guidance of flat to up 3%
Gross Margin %	Raising to 46%-47%, including the $25.4 million Q2 tariff-related benefit, up from 41%-43%
Adjusted EBITDA*	Raising to $100M-$110M, including the $25.4 million Q2 tariff-related benefit, up from $70M-$80M
2026 Third Quarter
Net sales	Approximately flat year-over-year
Gross margin %	Approximately 43%-44%
Adjusted EBITDA*	$25 million to $30 million

Webcast Conference Call

The company will host a webcast at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) today, August 6, 2026, to further discuss its second quarter 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, as well as the Funko YouTube Channel at youtube.com/@FunkoIR. 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), 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 financial 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. A reconciliation of 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 third 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 $13 million, depreciation and amortization of approximately $60 million and interest expense of approximately $20 million, each of which is a reconciling item to net income. See “Use of Non-GAAP Financial Measures” and the attached reconciliations for more information.

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 Funko.com, Loungefly.com and MondoShop.com, and follow us on TikTok, X, and Instagram.

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 strategic plans, growth strategies, expectations in sales trends and anticipated financial results, including without limitation, our full year and third quarter 2026 guidance. 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 quarterly report on Form 10-Q for the quarter ended June 30, 2026 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.

Funko, Inc. Condensed Consolidated Statements of Operations (Unaudited)
	Three Months Ended June 30,							Six Months Ended June 30,
	2026			2025				2026				2025
	(In thousands, except per share data)
Net sales	$	207,719		$	193,469			$	408,638			$	384,208
Cost of sales (exclusive of depreciation and amortization)		90,090			131,429				202,182				245,297
Selling, general, and administrative expenses		79,723			82,259				163,410				167,066
Depreciation and amortization		15,767			14,528				30,541				29,790
Total operating expenses		185,580			228,216				396,133				442,153
Income (loss) from operations		22,139			(34,747	)			12,505				(57,945	)
Interest expense, net		5,198			4,522				10,082				8,371
Other expense, net		480			887				936				1,055
Income (loss) before income taxes		16,461			(40,156	)			1,487				(67,371	)
Income tax expense		1,016			848				4,169				1,692
Net income (loss)		15,445			(41,004	)			(2,682	)			(69,063	)
Less: net income (loss) attributable to non-controlling interests		61			(514	)			9				(985	)
Net income (loss) attributable to Funko, Inc.	$	15,384		$	(40,490	)		$	(2,691	)		$	(68,078	)
Income (loss) per share of Class A common stock:
Basic	$	0.28		$	(0.74	)		$	(0.05	)		$	(1.26	)
Diluted	$	0.27		$	(0.74	)		$	(0.05	)		$	(1.26	)
Weighted average shares of Class A common stock outstanding:
Basic		55,860			54,362				55,644				53,948
Diluted		57,461			54,362				55,644				53,948

Funko, Inc. Condensed Consolidated Balance Sheets (Unaudited)
	June 30, 2026				December 31, 2025
	(In thousands, except per share data)
Assets
Current assets:
Cash and cash equivalents	$	40,713			$	42,148
Accounts receivable, net		93,561				117,018
Inventories		88,800				83,136
Prepaid expenses and other current assets		51,540				48,094
Total current assets		274,614				290,396
Property and equipment, net		64,498				68,679
Operating lease right-of-use assets, net		41,671				46,928
Goodwill		133,848				133,900
Intangible assets, net		127,925				135,826
Other assets		11,191				9,505
Total assets	$	653,747			$	685,234
Liabilities and Stockholders’ Equity
Current liabilities:
Revolving credit facility	$	1,500			$	1,125
Current portion of term debt		16,939				21,932
Current portion of operating lease liabilities		16,989				18,792
Accounts payable		58,206				64,748
Accrued royalties		54,712				59,821
Accrued expenses and other current liabilities		87,583				77,499
Total current liabilities		235,929				243,917
Long-term debt		182,659				202,246
Operating lease liabilities		43,273				48,680
Other long-term liabilities		3,867				4,261
Commitments and Contingencies
Stockholders’ equity:
Class A common stock, par value $0.0001 per share, 200,000 shares authorized; 55,989 and 55,327 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively		5				5
Class B common stock, par value $0.0001 per share, 50,000 shares authorized; 91 and 91 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively		—				—
Additional paid-in-capital		362,526				357,330
Accumulated other comprehensive income		4,003				4,621
Accumulated deficit		(178,833	)			(176,142	)
Total stockholders’ equity attributable to Funko, Inc.		187,701				185,814
Non-controlling interests		318				316
Total stockholders’ equity		188,019				186,130
Total liabilities and stockholders’ equity	$	653,747			$	685,234

Funko, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited)
	Six Months Ended June 30,
	2026				2025
	(In thousands)
Operating Activities
Net loss	$	(2,682	)		$	(69,063	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		30,541				29,790
Equity-based compensation		5,196				6,377
Other, net		1,133				1,301
Changes in operating assets and liabilities:
Accounts receivable, net		23,318				24,572
Inventories		(6,160	)			(5,761	)
Prepaid expenses and other assets		2,499				5,529
Accounts payable		(5,992	)			3,207
Accrued royalties		(5,109	)			(14,967	)
Accrued expenses and other liabilities		(19,114	)			(25,427	)
Net cash provided by (used in) operating activities		23,630				(44,442	)
Investing Activities
Purchases of property and equipment		(18,954	)			(16,211	)
Other, net		—				970
Net cash used in investing activities		(18,954	)			(15,241	)
Financing Activities
Borrowings on revolving credit facility		—				85,000
Debt amendment costs		(3,648	)			—
Payments of term debt		(21,303	)			(11,530	)
Proceeds from sale of tariff receivable		19,248				—
Payments under tax receivable agreement		(249	)			—
Other, net		179				193
Net cash (used in) provided by financing activities		(5,773	)			73,663
Effect of exchange rates on cash and cash equivalents		(338	)			516
Net change in cash and cash equivalents		(1,435	)			14,496
Cash and cash equivalents at beginning of period		42,148				34,655
Cash and cash equivalents at end of period	$	40,713			$	49,151

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

	Three Months Ended June 30,								Six Months Ended June 30,
	2026				2025				2026				2025
	(In thousands, except per share data)
Net income (loss) attributable to Funko, Inc.	$	15,384			$	(40,490	)		$	(2,691	)		$	(68,078	)
Reallocation of net income (loss) attributable to non-controlling interests from the assumed exchange of common units of FAH, LLC for Class A common stock (1)		61				(514	)			9				(985	)
Equity-based compensation (2)		2,782				3,112				5,196				6,377
Foreign currency transaction loss (3)		588				1,463				1,104				1,639
Tax receivable agreement liability adjustments (4)		—				—				112				—
Third-party debt amendment fees (5)		106				—				3,655				—
Income tax (benefit) expense (6)		(3,968	)			9,743				1,280				16,531
Adjusted net income (loss)	$	14,953			$	(26,686	)		$	8,665			$	(44,516	)
Adjusted net income (loss) margin (7)		7.2	%			(13.8	)%			2.1	%			(11.6	)%
Weighted-average shares of Class A common stock outstanding - basic		55,860				54,362				55,644				53,948
Equity-based compensation awards and common units of FAH, LLC that are convertible into Class A common stock		1,601				749				187				907
Adjusted weighted-average shares of Class A stock outstanding - diluted		57,461				55,111				55,831				54,855
Adjusted earnings (loss) per diluted share	$	0.26			$	(0.48	)		$	0.16			$	(0.81	)

	Three Months Ended June 30,								Six Months Ended June 30,
	2026				2025				2026				2025
	(amounts in thousands)
Net income (loss)	$	15,445			$	(41,004	)		$	(2,682	)		$	(69,063	)
Interest expense, net		5,198				4,522				10,082				8,371
Income tax expense		1,016				848				4,169				1,692
Depreciation and amortization		15,767				14,528				30,541				29,790
EBITDA	$	37,426			$	(21,106	)		$	42,110			$	(29,210	)
Adjustments:
Equity-based compensation (2)		2,782				3,112				5,196				6,377
Foreign currency transaction loss (3)		588				1,463				1,104				1,639
Tax receivable agreement liability adjustments (4)		—				—				112				—
Third-party debt amendment fees (5)		106				—				3,655				—
Adjusted EBITDA	$	40,902			$	(16,531	)		$	52,177			$	(21,194	)
Adjusted EBITDA margin (8)		19.7	%			(8.5	)%			12.8	%			(5.5	)%

(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)		Represents both unrealized and realized foreign currency losses on transactions denominated other than in U.S. dollars, including derivative gains and losses on foreign currency forward exchange contracts.
(4)		Represents recognized adjustments to the tax receivable agreement liability.
(5)		Represents non-recurring third-party debt fees paid as part of the Fifth Amendment to the Credit Agreement.
(6)		Represents the income tax expense effect of the above adjustments, including adding back the valuation allowance to the net loss. This adjustment uses an effective tax rate of 25% for all periods presented.
(7)		Adjusted net income (loss) margin is calculated as adjusted net income (loss) as a percentage of net sales.
(8)		Adjusted EBITDA margin is calculated as adjusted EBITDA as a percentage of net sales.

 

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Investor Relations:
investorrelations@funko.com

Media:
pr@funko.com

Source: Funko, Inc.