Funko is once again facing the duality of products with proven demand and economic challenges pulling down the business.
The Washington-based company behind Pop! Vinyl, Loungefly, and Mondo reported a sharp year-over-year decline in its second quarter 2025 financials, with net sales falling to $193.5 million compared to $247.7 million in Q2 2024 — a nearly 22% drop. Gross profit fell to $62 million, resulting in a gross margin of 32.1%, down from 42% in the prior-year period.
Sales of core collectibles slipped 15.7% followed by a 23.2% dip in Loungefly sales. The company’s “Other” category, a sort of catch-all for additional products, fell off a cliff, charting a 78.7% decline versus last year.
As expected, our 2025 second quarter performance was impacted by a dynamic and uncertain tariff environment. Looking ahead, we expect headwinds to moderate and our business to improve as a result of the actions we've taken to cut costs, diversify product sourcing and adjust prices. The team is focused on stabilizing the business, accelerating execution on growth initiatives and unlocking Funko's long-term potential."
The earnings come just days after Funko approved retention bonuses for CFO Yves LePendeven ($300,000) and Tracy Daw, Chief Legal Officer and Secretary ($150,000), subject to continued employment through March 31, 2026. Additionally, the company’s Board of Directors approved a two-month compensation package for Interim CEO Michael Lunsford, including a monthly cash fee of $75,000 and a monthly award of 10,000 restricted stock units.
“I stepped in again at the Board’s request to help Funko realize the full potential of its business by accelerating the organic growth initiatives, exploring financial and strategic options for the business, and identifying Funko’s next CEO,” Lunsford said on an earnings call with analysts Thursday afternoon.
According to LePendeven, tariffs and related expenses are estimated to cost Funko $40 million this year, as the company works to diversify its supply chain, which is largely dependent on Vietnam and China. Price increases in the U.S. have helped, with no real impact on demand, according to company execs.
Deeper into the Numbers
Selling, general, and administrative (SG&A) expenses totaled $82.3 million, up from $77.9 million in 2024. Last year’s figure included a one-time net benefit of $1.5 million, making the year-over-year comparison slightly uneven. Details related to the non-recurring charges were included in the company’s reconciliation tables.
The company posted a net loss of $41 million, or $0.74 per share, compared to net income of $5.4 million, or $0.10 per share, a year ago. On an adjusted basis, net loss came in at $26.7 million, or $0.48 per share, reversing an adjusted net income of $5.6 million, or $0.10 per diluted share.
Adjusted EBITDA swung to a loss of $16.5 million from a positive $27.9 million a year earlier, marking a difficult quarter as the company navigated macroeconomic headwinds and operational pressure.
Future Outlook
Funko is leaning into its direct-to-consumer business, the triumphant success of its recent Comic-Con International: San Diego (SDCC) activations, and growth in categories like sports and Bitty Pop! as wins.
Meanwhile, the company filed a $100 million mixed securities shelf with the SEC. The document includes a prospectus for the sales of additional securities, which Funko may choose to pursue later. You can view the Securities Registration Statement here.
