Funko Inc. Reports 2024 Financial Results and Provides 2025 Outlook

Funko reported a modest increase in net sales for Q4 2024, totaling $293.7 million, up from $291.2 million in the prior year. The company's gross profit saw a significant improvement, reaching $124.4 million, which translates to a gross margin of 42.4%, compared to 37.6% the previous year.

Adjusted EBITDA for the fourth quarter was $26.3 million, up from $23.1 million in the same quarter of 2023, marking an upward trajectory that reflects the company’s strategic initiatives.

For the full year of 2024, Funko's net sales dipped to $1.05 billion, down from $1.10 billion in 2023. However, gross profit saw a substantial increase, reaching $434.5 million, with a gross margin of 41.4%, compared to 30.4% in the previous year.

Cynthia Williams, CEO of Funko, remarked, “2024 was a pivotal year for Funko. We strengthened our business, delivered on key financial goals, and positioned the company for long-term success.” The company notably reduced its total debt by $90 million during the year, a move that underscores its commitment to financial discipline.

Funko's net sales by product brand for Q4 were led by the Core Collectible category, which generated $232.7 million, reflecting a 10.6% increase year-over-year. However, the Loungefly brand experienced a decline of 26.9%, with sales dropping to $42.4 million.

Geographically, the United States saw a decrease in sales, totaling $178.2 million, down 9.7% from the previous year. Conversely, sales in Europe increased by 21.2%, reaching $94.7 million.

As of December 31, 2024, Funko reported total cash and cash equivalents of $34.7 million, with a significant reduction in inventories to $92.6 million from $119.5 million in the previous year. Moreover, total debt was reduced to $182.8 million, a notable decrease from $273.6 million in 2023.

Funko provided a cautious but hopeful outlook for 2025, anticipating net sales between $1.050 billion and $1.082 billion and an adjusted EBITDA ranging from $80 million to $100 million. The company also expects first-quarter net sales to be between $188 million and $198 million, alongside a projected gross margin of approximately 39%.

The company’s outlook takes into account the anticipated impacts of 20% tariffs on imports from China, which have been announced through February 27, 2025. However, further tariff actions remain uncertain, creating a variable risk factor for the company’s projections.

As Funko continues to navigate the complexities of the pop culture collectibles market, its recent financial performance and strategic initiatives indicate a robust approach to growth and sustainability. With a clear pathway outlined for 2025, Funko is poised to leverage its strong brand presence and diverse product offerings to enhance shareholder value and fortify its position in the market.