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Funko
🇺🇸 NASDAQ:FNKO
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•
Mar 31, 2022

Funko Q1 2022 Earnings Report

Reported record first-quarter net sales and raised full-year net sales and adjusted EPS guidance.

Key Takeaways

Funko reported a strong first quarter in 2022, with net sales increasing by 63.0% year-over-year to $308.3 million and net income growing by 31.0% year-over-year to $14.5 million. The company's performance was driven by sustained demand from Funko fans and strength across geographies, brands, and channels. Funko also raised its full-year net sales and adjusted EPS guidance.

Net sales increased 63.0% year-over-year to $308.3 million.

Net income grew 31.0% year-over-year to $14.5 million.

U.S. net sales increased 70.1% year-over-year to $232.2 million, Europe net sales increased 43.5% year-over-year to $57.1 million.

Loungefly net sales increased 103.5% year-over-year to $50.1 million.

Total Revenue
$308M
Previous year: $189M
+63.0%
EPS
$0.34
Previous year: $0.24
+41.7%
Gross Margin
35.3%
Previous year: 41.4%
-14.7%
Adjusted EBITDA Margin
11.8%
Previous year: 15.7%
-24.8%
Gross Profit
$109M
Previous year: $78.3M
+38.8%
Cash and Equivalents
$33.1M
Previous year: $74.7M
-55.6%
Free Cash Flow
-$42.1M
Previous year: $33.6M
-225.5%
Total Assets
$965M
Previous year: $769M
+25.5%

Funko

Funko

Funko Revenue by Segment

Funko Revenue by Geographic Location

Forward Guidance

The Company expects net sales of $1.275 to $1.325 billion (24% to 29% y/y); Adjusted EBITDA margin of approximately 14.6% at the midpoint of our revenue range; Adjusted Net Income of $98.6 million to $103.8 million, based on a blended tax rate of 25%; and Adjusted Earnings per Diluted Share of $1.80 to $1.90, based on estimated adjusted average diluted shares outstanding of 54.6 million for the full year.

Positive Outlook

  • Net sales of $1.275 to $1.325 billion (24% to 29% y/y)
  • Adjusted EBITDA margin of approximately 14.6% at the midpoint of our revenue range.
  • Adjusted Net Income of $98.6 million to $103.8 million, based on a blended tax rate of 25%
  • Adjusted Earnings per Diluted Share of $1.80 to $1.90, based on estimated adjusted average diluted shares outstanding of 54.6 million for the full year.
  • Gross margin lower sequentially, as we continue to face inflationary freight pressure

Challenges Ahead

  • Ongoing trans-ocean freight inflation
  • 80 bps of headwind from one-time project spend associated with the consolidation and relocation of our U.S.-based distribution center
  • Implementation of our new ERP system
  • SG&A as percent of net sales to increase sequentially, reflecting one-time project spend on our distribution center relocation, and ERP implementation
  • Lower gross margin and higher SG&A as a percent of sales, which are expected to reduce adjusted EBITDA margin sequentially before recovering in the second half of this year

Company Overview

Full financial data and analysis

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