Funko Reiterates 2026 Outlook After Third-Quarter Sales Slow
Third-quarter net sales were $258.3 million, up 3.0%, as Core Collectibles rose 4.8% and Loungefly fell 9.8%.
Funko, Inc. (FNKO), a pop culture lifestyle brand, reported third-quarter net sales of $258.3 million, a 3.0% increase from $250.9 million a year earlier, and reiterated its full-year 2026 outlook of flat to up 3% growth.
Year-over-year sales growth slowed from 7.4% in the second quarter, when net sales were $207.7 million. Core Collectibles, the company’s largest category, rose 4.8% to $210.1 million, after 9.0% growth in the prior quarter. Loungefly sales fell 9.8% to $40.3 million. The company said Loungefly’s decline reflected SKU rationalization and a decision to concentrate the assortment behind products with stronger demand. Other categories contributed $8.0 million.
Gross profit was $116.9 million, or a 45.2% gross margin, compared with $100.8 million, or 40.2%, a year earlier. The company attributed the year-over-year margin expansion to lower tariffs, lower minimum guaranteed royalties, and adjustments to the royalty audit accrual. Second-quarter gross margin of 56.6% had included a $25.4 million pre-tax benefit from expected tariff refunds and the release of accrued tariffs; that benefit is not in the third-quarter result.
Selling, general and administrative expenses were $86.9 million, or 33.6% of sales, compared with $79.8 million, or 31.8%, a year earlier. Net income was $7.5 million, or $0.13 a share, compared with $0.9 million, or $0.02 a share. Adjusted net income was $9.2 million, or $0.16 a share. Adjusted EBITDA was $32.1 million, or a 12.4% margin, versus $24.4 million, or 9.7%, a year earlier. Chief Executive Officer Josh Simon said adjusted EBITDA was above guidance.
United States sales fell 2.4% to $151.7 million, reversing a 3.4% increase in the second quarter. Europe sales grew 11.5% to $82.7 million, after 19.4% growth in the second quarter. Other international sales grew 12.1% to $23.9 million, reversing a 5.1% decline in the second quarter. Simon said international markets were again a source of strength.
The company said it reiterated 2026 full-year net sales of flat to up 3%, gross margin of 46% to 47% including the $25.4 million second-quarter tariff-related benefit, and adjusted EBITDA of $100 million to $110 million including that benefit. It cited third-quarter performance, expected continued growth in Core Collectibles, and the Loungefly SKU decision.
Cash and cash equivalents were $41.6 million at September 30, 2026. Inventories were $91.6 million. Total debt was $195.9 million, down from $201.1 million at June 30, 2026. The company said total debt had been reduced by $29 million year-to-date, including $5 million in the third quarter.
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