NASDAQ$FNKO

Funko Inc · Q1 2022 earnings

Q1 2022 earnings · · Investor relations

Briefing

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

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.

Headline financials

Total Revenue

$308M

Previous: $189M+63.0%
EPS (adj)

$0.34

Previous: $0.24+41.7%
Gross Margin

35.3%

Previous: 41.4%-14.7%
Adjusted EBITDA Margin

11.8%

Previous: 15.7%-24.8%
Capital Expenditures

-$19.2M

Previous: -$3.88M-393.9%
Free Cash Flow

-$9.3M

Previous: $2.63M-453.6%
Net Income

$9.88M

Previous: $6.51M+51.7%
Operating Income

$19.8M

Previous: $16.8M+17.9%
Gross Profit

$109M

Previous: $78.3M+38.8%
Cash & Equivalents

$33.1M

Previous: $74.7M-55.6%
Total Assets

$965M

Previous: $769M+25.5%
Stock-Based Comp

$3.37M

Previous: $2.69M+25.2%

Revenue & EPS history

Funko · Revenue · Quarterly

$308M

Q1 2022+63%vs Q1 2021
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Revenue by segment

Funko · $308M total across 3 segments · Q1 2022

  • Core Collectible
    $240M+59.1%
  • Loungefly
    $50.1M+104.5%
  • Other
    $18.6M+30.0%

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.

Tailwinds

  • 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

Headwinds

  • 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

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2022

Historical avgQ1 2022

+0.2%

Avg return

Earnings day

+0.2%

Avg return

5 days after

+4.2%

Avg return

30 days after

56%

19 / 34 earnings

Positive

+25.1%

Q1 2020

Best reaction

-59.2%

Q3 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.6%+26.3%+16.2%
Q4 2025-4.0%-18.6%-15.3%
Q3 2025+10.3%+22.2%-0.3%
Q1 2025-16.5%+11.7%+14.5%
Q4 2024-13.5%-28.8%-49.3%
Q3 2024-3.4%-9.2%+0.9%
Q2 2024+11.7%+11.0%+11.6%
Q1 2024+8.9%+28.2%+43.5%
Q4 2023+7.0%-0.8%-10.6%
Q3 2023+22.1%+9.6%-5.0%
Q2 2023-13.2%-12.7%-4.4%
Q1 2023+15.0%+13.5%+27.4%
Q4 2022-8.0%-9.6%-12.8%
Q3 2022-59.2%-47.1%-45.8%
Q2 2022-19.2%-22.0%-23.1%
Q1 2022+19.5%+8.9%+21.7%
Q4 2021+9.5%-4.0%-1.6%
Q3 2021+10.8%+8.1%-7.6%
Q2 2021-3.3%-5.0%-0.5%
Q1 2021+19.1%+9.5%+10.2%
Q4 2020+23.0%+24.3%+58.0%
Q3 2020-9.4%+12.0%+63.2%
Q2 2020-4.8%+2.9%+2.6%
Q1 2020+25.1%+18.4%+88.1%
Q4 2019-8.1%-17.5%-57.8%
Q3 2019-12.7%-16.1%-18.0%
Q2 2019+10.0%+9.1%+8.1%
Q1 2019+3.4%+9.7%+4.6%
Q4 2018+3.8%-6.7%+7.8%
Q3 2018-25.3%-25.7%-31.5%
Q2 2018+8.5%+7.3%+50.3%
Q1 2018+2.5%+3.5%+28.4%
Q4 2017+7.1%+13.0%+3.4%
Q3 2017-10.7%-17.2%-34.7%
Q2 2017
Q1 2017
Q4 2016
Q3 2016
Q2 2016
Q1 2016
Q4 2015

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