Funko (FNKO) Q4 2024 earnings summary

Executive summary

• Q4 2024 net sales reached $293.7 million, up 1% year-over-year and at the upper end of guidance, with gross margin and adjusted EBITDA exceeding expectations, driven by strong DTC and EMEA sales.

• Full-year 2024 net sales were $1.05 billion, down from $1.10 billion in 2023, but gross profit and adjusted EBITDA improved by over $100 million each, and total debt was reduced by $90 million.

• DTC sales grew to 29% of total sales, up from 25% in Q4 2023, delivering higher margins and critical consumer insights.

• Core collectibles business grew over 10% in Q4, with international sales outside the U.S. up over 20%.

• Leadership team strengthened with key hires in brand, sales, and sports licensing.

Financial highlights

• Q4 net sales: $293.7 million, up 1% year-over-year.

• Q4 gross profit: $124.4 million (42.4% margin), up from $109.4 million (37.6%) in Q4 2023.

• Q4 adjusted net income: $4.4 million ($0.08 per diluted share), up from $0.1 million in Q4 2023.

• Q4 adjusted EBITDA: $26.3 million, well above guidance.

• Full-year 2024 net sales: $1.05 billion; adjusted EBITDA: $94.7 million, up from negative $11.8 million in 2023.

• Cash and cash equivalents at year-end: $34.7 million; total debt reduced to $182.8 million from $273.6 million last year.

• Net inventory: $92.6 million, down over 20% from 2023 and over 60% from 2022.

• Total company liquidity increased to $124.7 million from $57 million at end of 2023.

• Full-year net loss was $14.7 million ($0.28/share) vs. $154.1 million ($3.19/share) prior year; adjusted net income was $8.7 million ($0.16/share) vs. adjusted net loss of $74.7 million.

Outlook and guidance

• 2025 full-year net sales expected between $1.05 billion and $1.102 billion; adjusted EBITDA between $80 million and $100 million.

• Q1 2025 guidance: net sales $188–198 million, gross margin ~39%, SG&A ~$91 million, adjusted net loss $22–25 million, negative adjusted EBITDA $9–14 million.

• First half of 2025 expected to be down year-over-year, with growth anticipated in the second half as strategic initiatives take effect.

• Guidance incorporates 20% tariffs on China imports and softening U.S. consumer behavior; further tariff escalation not included.

• Mitigation strategies include renegotiating factory costs, shifting production, and pricing adjustments.