FNKO · Funko, Inc.

Funko, Inc. delivered a strong Q1 2026 performance, with net sales reaching $200.9 million, a 5.3% increase year-over-year, primarily driven by robust 16.8% growth in Core Collectibles to $168.8 million, fueled by Standard Pop! and Bitty Pop! lines, alongside 25.6% expansion in Europe to $68.1 million. This marked the first YoY sales growth since Q4 2024. Gross margin hit a record 44.2%, up from 40.3%, attributed to price adjustments, favorable sales mix, reduced discounts, promotional activity, and lower minimum guaranteed royalties from renewed licensing agreements. SG&A expenses slightly declined to $83.7 million, reflecting discipline. Despite a GAAP net loss of $18.1 million ($0.33/share), adjusted net loss narrowed to $6.3 million ($0.11/share), and adjusted EBITDA swung to $11.3 million from negative $4.7 million, all significantly beating guidance. CEO Josh Simon highlighted positive momentum from late 2025, strong international sales especially Europe, and execution on strategic plan focusing on cultural moments. Balance sheet strengthened with cash at $34.3 million (down from $42.1 million year-end), inventories reduced 8% to $76.8 million, and total debt lowered to $215.9 million from $225.3 million, aided by $6 million principal paydown and $3.6 million debt amendment costs. Operating cash flow turned positive at $10.2 million versus negative prior year. The company reiterated FY2026 outlook for net sales flat to +3%, gross margin 41-43%, and adjusted EBITDA $70-80 million, with Q2 guidance of $195-205 million sales (+1-6%), 42-44% gross margin, and $5-10 million adjusted EBITDA. Operational enhancements include Asia expansion efforts, appointment of Andy Oddie as Chief International Officer, and Nik Rupp as SVP Brand and Marketing. Brand highlights featured top properties, Inter Miami shop-in-shop, WWE activations, iShowSpeed, and FIFA World Cup products, underscoring 'moving at the speed of culture' strategy.