Funko, Inc. (FNKO) Bundle
A Brief History of Funko, Inc.
Company Overview
Funko, Inc. is a pop culture consumer products company known for its collectible vinyl figures, games, and other merchandise. As of September 30, 2024, Funko operates under a number of licensed properties, producing merchandise that appeals largely to collectors and fans of various franchises.
Financial Performance
For the nine months ended September 30, 2024, Funko reported net sales of $756.1 million, a decline of 6.1% compared to $804.9 million for the same period in 2023. This decrease was primarily attributed to reduced sales to specialty retailers and e-commerce platforms.
| Metric | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $756.1 million | $804.9 million | $(48.7 million) | (6.1%) |
| Cost of Sales | $445.99 million | $581.26 million | $(135.27 million) | (23.3%) |
| Gross Margin | 41.0% | 27.8% | +13.2% | n/a |
| Net Loss | $(13.65 million) | $(153.23 million) | +$139.58 million | (91.1%) |
Cost Management
Funko's cost of sales (exclusive of depreciation and amortization) for the nine months ended September 30, 2024, was $446.0 million, reflecting a decrease of 23.3% from $581.3 million in the previous year. This reduction was driven by lower costs as a percentage of net sales.
Operating Expenses
Selling, general, and administrative expenses totaled $256.2 million for the nine months ended September 30, 2024, down 8.4% from $279.7 million for the same period in 2023.
| Expense Type | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Selling, General & Administrative | $256.2 million | $279.7 million | $(23.5 million) | (8.4%) |
| Depreciation & Amortization | $46.4 million | $44.3 million | +$2.1 million | +4.7% |
Debt and Interest Expenses
As of September 30, 2024, Funko had a total debt of $128.4 million, down from $153.1 million at the end of 2023. Net interest expense was $16.4 million for the nine months ended September 30, 2024, a decrease of 20.4% from $20.6 million in the previous year.
Cash Flow Analysis
Net cash provided by operating activities for the nine months ended September 30, 2024, was $63.7 million, significantly improving from net cash used of $(2.9 million) in the same period of 2023. This increase was primarily due to a decrease in net loss and improved working capital management.
| Cash Flow Activity | 2024 (9 Months) | 2023 (9 Months) |
|---|---|---|
| Net Cash Provided by Operating Activities | $63.7 million | $(2.9 million) |
| Net Cash Used in Investing Activities | $(13.4 million) | $(35.6 million) |
| Net Cash Used in Financing Activities | $(58.6 million) | $51.3 million |
Market Position and Future Outlook
Funko's market position remains strong with a portfolio of over 892 active properties as of September 30, 2024, reflecting a 2.6% increase from the previous year. However, the average net sales per active property decreased by 8.5% year-over-year, indicating challenges in maintaining sales growth across its product lines.
A Who Owns Funko, Inc. (FNKO)
Ownership Structure
As of September 30, 2024, Funko, Inc. owns 52.7 million common units of FAH, LLC, representing a 96.8% economic ownership interest in FAH, LLC. This increased from 50.5 million units, which represented a 94.9% interest as of December 31, 2023.
Shareholder Breakdown
The ownership of Funko, Inc. consists of Class A and Class B common stock, with the following details:
| Type of Stock | Shares Issued | Shares Outstanding | Ownership Percentage |
|---|---|---|---|
| Class A Common Stock | 52,692,000 | 52,692,000 | 100% |
| Class B Common Stock | 1,433,000 | 1,433,000 | 0% |
Key Shareholder Information
Major shareholders and institutional investors include:
- ACON Funko Investors, L.L.C. - significant stakeholder with previous sales of shares to TCG.
- Various institutional investors, including mutual funds and pension funds, holding a combined substantial portion of Class A shares.
- Management and insiders hold a portion of shares, contributing to voting control and strategic decisions.
Financial Performance Indicators
Key financial metrics relevant to shareholder value include:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $292.8 million | $312.9 million | -6.4% |
| Net Income (Loss) | $4.6 million | $(16.2) million | — |
| Adjusted EBITDA | $30.9 million | $25.4 million | 21.7% |
Capital Structure
The capital structure of Funko, Inc. is leveraged with various forms of debt and equity financing:
| Debt Type | Amount Outstanding (in millions) | Interest Rate |
|---|---|---|
| Term Loan Facility | $116.6 million | Variable |
| Revolving Credit Facility | $95.0 million | Variable |
| Equipment Finance Loan | $11.8 million | 5.71% |
Recent Developments
In the recent fiscal period, Funko, Inc. has focused on enhancing its product lines and managing costs effectively, resulting in a notable decrease in net loss from $(16.2) million to $4.6 million year-over-year. The company's strategy includes optimizing inventory and strengthening relationships with key retailers.
Concluding Financial Metrics
As of Q3 2024, Funko, Inc. reported:
| Metric | Value |
|---|---|
| Total Assets | $783.6 million |
| Total Liabilities | $368.2 million |
| Stockholders' Equity | $415.4 million |
Funko, Inc. (FNKO) Mission Statement
Overview of Funko, Inc.
Funko, Inc. (FNKO) is a prominent company in the collectibles industry, known for its wide range of pop culture products, including vinyl figures, plush toys, and accessories. The company aims to provide fans with innovative and high-quality products that celebrate their favorite characters from various franchises.
Current Mission Statement
The mission statement of Funko, Inc. as of 2024 emphasizes their commitment to delivering exceptional and innovative products while fostering a vibrant community among fans. The statement reflects their dedication to creativity, inclusivity, and a passion for pop culture.
Financial Performance Metrics
In evaluating the effectiveness of Funko's mission, it is essential to consider their financial performance, which provides insight into the company's operational success and market reception.
| Financial Metrics | 2024 (Nine Months Ended Sept 30) | 2023 (Nine Months Ended Sept 30) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $756.1 million | $804.9 million | $(48.7 million) | (6.1%) |
| Cost of Sales | $446.0 million | $581.3 million | $(135.3 million) | (23.3%) |
| Gross Margin | 41.0% | 27.8% | 13.2% | 47.5% |
| Net Income (Loss) | $(13.7 million) | $(153.2 million) | $139.5 million | 91.1% |
| EBITDA | $51.981 million | $42.514 million | $9.467 million | 22.3% |
| Adjusted EBITDA | $68.476 million | $3.745 million | $64.731 million | 1,730.5% |
Market Position and Product Range
As of September 30, 2024, Funko has expanded its active properties to 892, representing a 2.6% increase from 869 in 2023. However, the average net sales per active property decreased by 8.5% due to fluctuating demand across various franchises.
Geographical Sales Breakdown
The geographical distribution of sales highlights Funko's performance in key markets:
| Region | 2024 Net Sales | 2023 Net Sales | Change ($) | Change (%) |
|---|---|---|---|---|
| United States | $503.8 million | $558.3 million | $(54.5 million) | (9.8%) |
| Europe | $189.1 million | $190.4 million | $(1.3 million) | (0.7%) |
| Other International | $63.2 million | $56.2 million | $7.0 million | 12.4% |
Strategic Initiatives
Funko's strategic initiatives include enhancing direct-to-consumer sales and expanding its product line to attract a broader audience. The company has increased its advertising and marketing costs to support these growth initiatives, reflecting its ambition to deepen customer engagement and drive sales.
Conclusion on Mission Alignment
Funko, Inc.'s mission statement aligns with its operational strategies and financial performance. The company's focus on innovation, community, and high-quality products is crucial in navigating the challenges faced in the collectibles market.
How Funko, Inc. (FNKO) Works
Overview of Company Operations
Funko, Inc. specializes in the design, manufacture, and distribution of licensed pop culture products, primarily focusing on collectibles such as vinyl figures, plush, and accessories. As of September 30, 2024, Funko's product offerings include a wide range of active licensed properties, which increased by 2.6% to 892 compared to the previous year.
Financial Performance
For the nine months ended September 30, 2024, Funko reported net sales of $756.1 million, a decrease of 6.1% from $804.9 million in the same period of the previous year. The following table summarizes key financial metrics:
| Metric | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $756,121,000 | $804,850,000 | ($48,729,000) | (6.1%) |
| Cost of Sales | $445,992,000 | $581,258,000 | ($135,266,000) | (23.3%) |
| Gross Margin | 41.0% | 27.8% | +13.2% | 47.5% |
| Net Income (Loss) | ($13,650,000) | ($153,230,000) | $139,580,000 | 91.1% |
Cost Structure
Cost of sales for the nine months ended September 30, 2024, was $445.99 million, significantly lower than the previous year's $581.26 million. The gross margin improved to 41.0%, up from 27.8%, influenced by a one-time inventory write-down of $30.1 million recognized in the prior year. Selling, general, and administrative expenses were $256.15 million, down 8.4% from $279.69 million in the previous year.
Operational Efficiency
For the nine months ended September 30, 2024, Funko's EBITDA was $51.98 million, compared to $42.51 million in the same period of 2023. Adjusted EBITDA increased to $68.48 million from $3.75 million year-over-year. The efficiency in operations is reflected in the reduction of interest expenses, which decreased by 20.4% to $16.36 million.
Geographical Sales Breakdown
The geographical distribution of net sales for the nine months ended September 30, 2024, is as follows:
| Region | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| United States | $503,800,000 | $558,300,000 | ($54,500,000) | (9.8%) |
| Europe | $189,100,000 | $190,400,000 | ($1,300,000) | (0.7%) |
| Other International | $63,200,000 | $56,200,000 | $7,000,000 | 12.4% |
Product Line Performance
Net sales by product line for the nine months ended September 30, 2024, demonstrated a decline in key categories:
| Product Line | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Core Collectible | $571,700,000 | $592,800,000 | ($21,100,000) | (3.6%) |
| Loungefly | $129,500,000 | $156,600,000 | ($27,100,000) | (17.3%) |
| Other Branded Products | $54,900,000 | $55,500,000 | ($600,000) | (1.0%) |
Cash Flow Summary
Net cash provided by operating activities for the nine months ended September 30, 2024, was $63.74 million, compared to a cash outflow of $2.87 million in the prior year. The cash flow from investing activities was $13.39 million, and cash used in financing activities amounted to $58.58 million.
| Cash Flow Activity | 2024 | 2023 |
|---|---|---|
| Operating Activities | $63,742,000 | ($2,867,000) |
| Investing Activities | ($13,387,000) | ($35,584,000) |
| Financing Activities | ($58,575,000) | $51,309,000 |
Debt and Interest Obligations
As of September 30, 2024, Funko's interest expense was reduced to $16.36 million, a decrease from $20.55 million in the previous year. The company maintained a revolving credit facility with an outstanding balance of $107.1 million during the quarter.
Equity and Shares Outstanding
As of September 30, 2024, the weighted average shares of Class A common stock outstanding was 52,523,000, with an earnings per diluted share of $0.08, a significant improvement from a loss of $0.31 per diluted share in the same quarter of 2023.
How Funko, Inc. (FNKO) Makes Money
Revenue Streams
Funko, Inc. generates revenue primarily through the sale of licensed pop culture merchandise, including figures, plush toys, and accessories. The company operates under various brands such as Funko Pop!, Loungefly, and others.
Financial Performance
For the nine months ended September 30, 2024, Funko reported net sales of $756.1 million, a decrease of 6.1% compared to $804.9 million for the same period in 2023. This decline was attributed to decreased sales to specialty retailers and e-commerce sites.
| Period | Net Sales (in millions) | Year-over-Year Change (%) |
|---|---|---|
| 2024 (9 months) | $756.1 | -6.1% |
| 2023 (9 months) | $804.9 | N/A |
Cost of Sales and Gross Margin
The cost of sales for the nine months ended September 30, 2024, was $446.0 million, reflecting a decrease of 23.3% from $581.3 million in 2023. The gross margin for the same period increased to 41.0% from 27.8% in 2023, indicating improved profitability due to lower costs as a percentage of net sales.
| Period | Cost of Sales (in millions) | Gross Margin (%) |
|---|---|---|
| 2024 (9 months) | $446.0 | 41.0% |
| 2023 (9 months) | $581.3 | 27.8% |
Operating Expenses
Selling, general, and administrative expenses were $256.2 million for the nine months ended September 30, 2024, down 8.4% from $279.7 million in 2023. This reduction was driven primarily by a decrease in personnel and related costs.
| Period | Selling, General, and Administrative Expenses (in millions) | Year-over-Year Change (%) |
|---|---|---|
| 2024 (9 months) | $256.2 | -8.4% |
| 2023 (9 months) | $279.7 | N/A |
Net Income and Loss
For the nine months ended September 30, 2024, Funko recorded a net loss of $13.7 million, significantly improved from a net loss of $153.2 million for the same period in 2023. This improvement was largely due to increased gross margins and reduced operating expenses.
| Period | Net Income (Loss) (in millions) |
|---|---|
| 2024 (9 months) | $(13.7) |
| 2023 (9 months) | $(153.2) |
Key Performance Indicators
Funko's key performance indicators for the three months ended September 30, 2024, include:
| Metric | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Net Sales (in millions) | $292.8 | $312.9 |
| Net Income (Loss) (in millions) | $4.6 | $(16.2) |
| EBITDA (in millions) | $26.1 | $9.9 |
Geographical Sales Breakdown
For the nine months ended September 30, 2024, net sales by region were:
| Region | Net Sales (in millions) | Year-over-Year Change (%) |
|---|---|---|
| United States | $503.8 | -9.8% |
| Europe | $189.1 | -0.7% |
| Other International | $63.2 | +12.4% |
Product Categories
Net sales by product category for the nine months ended September 30, 2024, included:
| Product Category | Net Sales (in millions) | Year-over-Year Change (%) |
|---|---|---|
| Core Collectible | $571.7 | -3.6% |
| Loungefly | $129.5 | -17.3% |
| Other Branded Products | $54.9 | -1.0% |
Conclusion
Funko's revenue generation is heavily reliant on its diverse product offerings and strong licensing agreements, yet faces challenges with market fluctuations and sales declines in certain categories.
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Resources:
- Funko, Inc. (FNKO) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Funko, Inc. (FNKO)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Funko, Inc. (FNKO)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.