JAKKS Pacific (JAKK) investor relations material

Executive summary

• Q1 2026 net sales were $106.7 million, down 6% year-over-year, with a net loss of $4.3 million and an operating loss of $5.6 million, compared to a $2.4 million net loss and $3.8 million operating loss in Q1 2025.

• Toys/Consumer Products segment sales declined 7% to $100.1 million, while Costumes segment sales rose 13% to $6.6 million, driven by international and Nintendo-related sales.

• Gross margin decreased to 33.4%, down 100 basis points year-over-year, reflecting higher product costs and amortization.

• Board approved a $0.25 per share quarterly dividend, payable June 29, 2026.

• International sales reached a ten-year high, with strong growth in Europe, Asia, and EMEA, offsetting U.S. softness.

Financial highlights

• Gross profit was $35.6 million, down 9% year-over-year.

• Adjusted EBITDA was negative $0.4 million, compared to positive $0.4 million in Q1 2025.

• Adjusted net loss was $1.9 million ($0.17 per share), versus $0.4 million ($0.03 per share) in Q1 2025.

• Cash and equivalents increased to $64.0 million from $59.4 million a year ago.

• Inventory was $52.9 million at March 31, 2026, nearly flat year-over-year.

Outlook and guidance

• Management expects continued seasonality, with higher sales in Q2 and Q3, and highlights momentum in international growth.

• Near-term outlook is improved compared to 12 months ago, with confidence in achieving 2026 goals and setting up for a stronger 2027.

• Full-year SG&A expected to grow in line with sales, with continued investment in 2027 launches.

• Forward-looking statements caution that actual results may differ due to demand changes, product mix, timing of orders, competitive pressures, tariffs, and other factors.

• U.S. customers remain cautious, but the company is rebuilding its domestic base.