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Funko misses on earnings in 3Q despite a boost in net sales and a raised full-year outlook

Net sales in the third quarter were $176.9 million, a 24% boost compared with the previous year
Funko bobbleheads
Funko creates bobblehead-like figures based on pop culture characters

Funko Inc (NASDAQ:FNKO) shares slipped on an earnings miss, despite seeing a double digit jump in net sales domestically and internationally.

The pop culture products reported earnings of $0.08, falling below average analyst estimates of $0.23 per share.

Net sales for the quarter totaled $176.9 million, a 24% jump compared with $142.8 million in the previous third quarter, and better than the average analyst estimate of $166.04 million.

Shares of the Washington-based company fell nearly 10% to $18.05 in Thursday after-hours trading.

READ: Funko sees revenue boost in Q2, credits growth in its product portfolio

“Our strong portfolio of properties and products, and our growing network of retail partners allowed us to achieve very strong third quarter growth in sales,” said CEO Brian Mariotti in the company’s press release.

“We have delivered great results in every quarter since our IPO last year, despite a retail landscape that companies in the toy industry have described as challenging,” he added.

Net sales in the US increased 16% to $121.3 million and net sales internationally increased 44% to $55.6 million, which the company credited to growth in Europe.

The company expects net sales to be in a range of $645 million to $650 million, higher than its previous guidance of a range of $620 million to $630 million.

Adjusted EBITDA is now expected to be in a range of approximately $108 million to $112 million, increased from its prior guidance of a range of $104 million to $112 million.

Its adjusted pro forma earnings range has also been upped, expected to be a range of $0.68 to $0.73 per share compared with prior guidance of a range of $0.60 to $0.70 per share.

Funko is perhaps best known for its assortment of bobblehead-like figures based on pop culture characters, but also offers action figures, plush toys, accessories and homewares.

The company announced a partnership with Epic Games this summer to create toys and collectibles based on the popular battle royale game Fortnite. The toys are expected to launch by the 2018 holiday season.

 

Contact Lenore Fedow at [email protected]

Follow her on Twitter@LenoreMariee

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