The second quarter earnings season continues as Spin Master weighs in on the year so far.
The company behind PAW Patrol and Unicorn Academy reports that Q2 2025 revenue slid to $400.7 million, down 2.7% from last year, as softness in toy sales weighed against gains in digital gaming. According to Spin Master CFO Jonathan Roiter, the company made “meaningful progress” on its tariff mitigation plan as it looks to navigate global trade challenges this year.
Our second quarter results underscore our commitment to building a diversified, resilient portfolio across Toys, Entertainment, and Digital Games."
“While we experienced revenue pressure due to a shift in retailer ordering patterns driven by global tariffs, strong double-digit growth in our Digital Games segment helped to offset some of that impact in the quarter,” Miller adds. “Looking ahead, we are positioning Spin Master to navigate broader macroeconomic headwinds by remaining sharply focused on the consumer, accelerating innovation, scaling our global franchise brands, and unlocking new opportunities through our Creative Centers — laying the foundation for long-term, sustainable growth.”
In the Toys’ Creative Center, revenue dipped $18.6 million to $322.3 million in Q2, down 5.5%, as gross product sales fell $13.7 million to $371 million, a 3.6% decline. The dip was primarily driven by a temporary pullback in U.S. retailer orders early in the quarter amid global tariff uncertainty.
Still, there were some wins, including a 12% sales spike in Preschool, Infant & Toddler, and Plush and a 17% gain in Wheels & Action. These gains were more than offset by declines in Activities, Games & Puzzles, Dolls & Interactive (-32%), and Outdoor (-40%).
Diving deeper into the numbers, Spin Master’s adjusted EBITDA dropped to $28.7 million, reflecting a margin of 7.2%, compared to 13% in Q2 2024. Despite the dip, Spin Master realized $5.6 million in cost synergies tied to its Melissa & Doug acquisition. The company reported an operating loss of $52.4 million compared to $23 million during Q2 last year, and a net loss of $46.5 million, widening from a $24.5 million loss a year ago. Adjusted net loss came in at $7.4 million, or $0.07 per share.
Spin Master also generated $26.1 million in operating cash flow but ended the quarter with a free cash flow deficit of $15.2 million. Spin Master also continued returning capital to shareholders, repurchasing shares through its Normal Course Issuer Bid (NCIB) program.
The company will hold an earnings call with analysts this afternoon.
