Core Insights - The international operations of Jakks Pacific (JAKK) are crucial for assessing its financial resilience and growth prospects, especially given the company's expansive global footprint [1][2] Revenue Performance - The total revenue for Jakks in the quarter ended June 2025 was $119.09 million, reflecting a year-over-year decline of 19.9% [4] - Asia contributed $1.45 million, or 1.22% of total revenue, with a surprising increase of 20.67% compared to expectations of $1.2 million [5] - The Middle East and Africa generated $0.24 million, accounting for 0.20% of total revenue, which was a surprise decrease of 36.84% from the expected $0.38 million [6] - Australia and New Zealand contributed $0.89 million, or 0.74% of total revenue, with a surprise decrease of 32.37% from the anticipated $1.31 million [7] - Latin America generated $6.05 million, making up 5.08% of total revenue, which was a surprise decrease of 5.96% from the expected $6.43 million [8] - Canada contributed $8.83 million, or 7.41% of total revenue, with a significant surprise increase of 113.19% compared to the expected $4.14 million [9] - Europe accounted for $14.66 million, or 12.31% of total revenue, with a slight surprise decrease of 1.5% from the consensus estimate of $14.88 million [10] Future Projections - For the current fiscal quarter, total revenue is projected to reach $315.72 million, a decline of 1.8% from the same quarter last year [11] - The anticipated revenue breakdown includes: Asia at $2.7 million (0.9%), Middle East and Africa at $1.14 million (0.4%), Australia and New Zealand at $2.74 million (0.9%), Latin America at $17.89 million (5.7%), Canada at $9.05 million (2.9%), and Europe at $38.73 million (12.3%) [12] - For the full year, total revenue is expected to be $691.25 million, reflecting no growth from the previous year [13] Strategic Considerations - The reliance on international markets presents both opportunities and challenges for Jakks, making it essential to monitor international revenue trends for future projections [14] - Analysts are closely observing these trends, especially in light of increasing global interconnections and geopolitical uncertainties [15]

Company Overview - JAKKS Pacific, Inc. reported concerning Q2 results, indicating significant tariff turbulence due to sourcing from China [1] - The company previously experienced strong operational momentum with content-led sales growth, but this momentum is now challenged [1] Industry Context - The toy industry is facing challenges related to tariffs and sourcing issues, particularly from China, impacting companies like JAKKS Pacific [1]

Core Insights - JAKKS Pacific, Inc. unveiled a new product lineup at San Diego Comic-Con, featuring iconic franchises such as Super Mario, The Simpsons, DC x Sonic the Hedgehog, Bendy, and Dog Man [1][5]. Product Highlights - The Super Mario Big Bad Bowser figure, standing 12 inches tall, features sound effects and a "fire breathing" light effect, set to be available exclusively at Costco for $59.99 this October [2][8]. - Princess Peach, also 12 inches tall, includes interactive features and will be available in December for $39.99 [10]. - The Treehouse of Horror Countdown Advent Calendar from The Simpsons will feature 31 mystery characters and accessories, priced at $39.99 [13]. - New figurines and plush from the DC x Sonic the Hedgehog crossover were revealed, including various multipacks and plush figures, with prices ranging from $9.99 to $29.99 [23][25][19]. Additional Product Information - The Sonic the Hedgehog™ Shadow 18-inch Ice Cream Bar Plush is available for pre-order at GameStop for $44.99 [3][28]. - Metroid Prime items were introduced with refreshed packaging, including various 2.5-inch and 6-inch figures [4]. - Bendy: Lone Wolf Crane Game Mini Plush set will retail for $24.99, featuring seven mini plushes from the new video game [28]. - The Dog Man 2.5-inch Squirrel Tank set, including articulated figures, will be available for $29.99 [30].

[Press Release Overview](index=1&type=section&id=Press%20Release%20Overview) JAKKS Pacific announced Q2 and H1 2025 financial results, with US sales down, Rest of World sales up, and first-half Toy/Consumer Products sales flat [Headline and Reporting Period](index=1&type=section&id=1.1%20Headline%20and%20Reporting%20Period) JAKKS Pacific announced Q2 and H1 2025 financial results, highlighting mixed sales performance with US decline and international growth - US Sales were down in the Second Quarter 2025, while Rest of World sales were up[1](index=1&type=chunk) - First-half Toy/Consumer Products sales were flat compared to the prior year[1](index=1&type=chunk) - The report covers financial results for the second quarter and first-half ended June 30, 2025[1](index=1&type=chunk)[2](index=2&type=chunk)[3](index=3&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) Chairman and CEO Stephen Berman acknowledged the challenging year but expressed confidence in the company's first-half performance, attributing it to effective business management and leveraging decades of experience - Management believes first-half results demonstrate effective business management despite persistent uncertainty[4](index=4&type=chunk) - The company is capitalizing on decades of experience and relationships to navigate challenges[4](index=4&type=chunk) - Refinancing of the credit facility to a larger, cash-flow-funded structure further increases financial resilience and preparedness[5](index=5&type=chunk) [Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) This section presents key financial metrics for Q2 and H1 2025, including sales, margins, and profitability [Second Quarter 2025 Highlights](index=1&type=section&id=3.1%20Second%20Quarter%202025%20Highlights) For Q2 2025, net sales decreased by 20% year-over-year, primarily due to reduced direct-import sales in the US, although Rest of World sales increased significantly Second Quarter 2025 Financial Highlights | Metric | Q2 2025 (Millions USD) | Q2 2024 (Millions USD) | Change (Millions USD) | Change (%) | | :------------------------------------ | :---------- | :---------- | :----------- | :--------- | | Net sales | $119.1 | $148.6 | $(29.5) | (20)% | | US net sales | $87.0 | N/A | N/A | (31)% | | Rest of World net sales | $32.1 | N/A | N/A | 41% | | Gross margin | 32.8% | 32.0% | N/A | +0.8 pp | | Gross profit | $39.0 | $47.6 | $(8.6) | (18)% | | Operating income (loss) | $(2.8) | $7.6 | $(10.4) | nm | | Adjusted net income (attributable to common stockholders) | $0.4 | $7.3 | $(6.9) | (94.5)% | | Adjusted EPS | $0.03 | $0.65 | $(0.62) | (95.4)% | | Adjusted EBITDA | $2.3 | $12.3 | $(10.0) | (81.3)% | [First-Half 2025 Highlights](index=1&type=section&id=3.2%20First-Half%202025%20Highlights) For the first half of 2025, net sales saw a modest 3% decrease, with Toy/Consumer Products sales remaining flat and Costumes sales declining First-Half 2025 Financial Highlights | Metric | H1 2025 (Millions USD) | H1 2024 (Millions USD) | Change (Millions USD) | Change (%) | | :------------------------------------ | :---------- | :---------- | :----------- | :--------- | | Net sales | $232.3 | $238.7 | $(6.4) | (3)% | | Toys/Consumer Products net sales | $187.8 | $187.5 | $0.3 | Flat | | Costumes net sales | $44.5 | $51.2 | $(6.7) | (13)% | | Gross margin | 33.6% | 28.8% | N/A | +4.8 pp | | Gross profit | $78.0 | $68.6 | $9.4 | 14% | | Operating loss | $(6.5) | $(13.7) | $7.2 | (52.6)% | | Adjusted net income (attributable to common stockholders) | $0.036 | $(4.0) | $4.036 | nm | | Adjusted EPS | $0.00 | $(0.38) | $0.38 | nm | | Adjusted EBITDA | $2.7 | $(4.9) | $7.6 | nm | [Detailed Financial Results](index=2&type=section&id=Detailed%20Financial%20Results) This section details net sales by segment and region, balance sheet items, and cash flow data [Second Quarter 2025 Performance](index=2&type=section&id=4.1%20Second%20Quarter%202025%20Performance) Net sales for Q2 2025 decreased by 20% year-over-year, with declines in both Toys/Consumer Products and Costumes segments, while Rest of World sales grew significantly Q2 2025 Net Sales by Segment and Region | Category | Q2 2025 Sales (Millions USD) | Q2 2024 Sales (Millions USD) | YoY Change (%) | | :---------------------- | :-------------- | :-------------- | :------------- | | Total Net Sales | $119.1 | $148.6 | (20)% | | Toys/Consumer Products | $80.4 | N/A | (23)% | | Costumes | $38.7 | N/A | (12)% | | United States Sales | $87.0 | $125.8 | (31)% | | Rest of World Sales | $32.1 | $22.8 | 41% | [First-Half 2025 Performance](index=2&type=section&id=4.2%20First-Half%202025%20Performance) Net sales for the first half of 2025 decreased by 3% year-over-year, with flat Toys/Consumer Products sales and a 13% decline in Costumes sales, offset by 33% growth in Rest of World sales H1 2025 Net Sales by Segment and Region | Category | H1 2025 Sales (Millions USD) | H1 2024 Sales (Millions USD) | YoY Change (%) | | :---------------------- | :-------------- | :-------------- | :------------- | | Total Net Sales | $232.3 | $238.7 | (3)% | | Toys/Consumer Products | $187.8 | $187.5 | Flat | | Costumes | $44.5 | $51.2 | (13)% | | United States Sales | $175.9 | $196.3 | (10)% | | Rest of World Sales | $56.4 | $42.4 | 33% | [Balance Sheet and Dividend Information](index=2&type=section&id=4.3%20Balance%20Sheet%20and%20Dividend%20Information) As of June 30, 2025, cash and cash equivalents significantly increased year-over-year, while inventory also rose, and a quarterly dividend of $0.25 per share was declared Key Balance Sheet Items (as of June 30, 2025) | Item | June 30, 2025 (Millions USD) | June 30, 2024 (Millions USD) | Dec 31, 2024 (Millions USD) | | :-------------------------- | :-------------- | :-------------- | :------------- | | Cash and cash equivalents (incl. restricted cash) | $43.1 | $17.9 | $70.1 | | Inventory | $71.8 | $51.3 | $52.8 | - A quarterly dividend of **$0.25 per share** on common stock was declared, payable September 30, 2025[8](index=8&type=chunk) [Non-GAAP Financial Information and Forward-Looking Statements](index=2&type=section&id=Non-GAAP%20Financial%20Information%20and%20Forward-Looking%20Statements) This section clarifies non-GAAP financial measures and the forward-looking statements disclaimer [Use of Non-GAAP Financial Information](index=2&type=section&id=5.1%20Use%20of%20Non-GAAP%20Financial%20Information) The company uses non-GAAP financial measures like Adjusted EBITDA and Adjusted Net Income (Loss) to provide additional insights into operating performance, excluding certain non-recurring and non-cash charges - Non-GAAP financial information, including Adjusted EBITDA and Adjusted Net Income (Loss), excludes various non-recurring and non-cash charges such as reorganization expenses and restricted stock compensation expense[9](index=9&type=chunk)[10](index=10&type=chunk) - These non-GAAP measures are considered useful for measuring operating performance and enhancing understanding of past financial performance by comparing across reporting periods on a consistent basis[10](index=10&type=chunk) - Investors should not consider non-GAAP measures in isolation or as a substitute for GAAP measures like net income or operating income[10](index=10&type=chunk) [Forward-Looking Statements Disclaimer](index=2&type=section&id=5.2%20Forward-Looking%20Statements%20Disclaimer) The press release contains forward-looking statements based on current expectations, which involve risks and uncertainties, and actual results may differ materially due to various factors - The press release may contain forward-looking statements based on current expectations, estimates, and projections[12](index=12&type=chunk) - Actual outcomes and results may differ materially due to numerous factors, including changes in demand for products, product mix, timing of orders, tariffs, and competitive products and pricing[12](index=12&type=chunk) - JAKKS undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date of the release[12](index=12&type=chunk) [Company and Investor Information](index=3&type=section&id=Company%20and%20Investor%20Information) This section provides investor conference call details, a company overview, and contact information [Conference Call Details](index=3&type=section&id=6.1%20Conference%20Call%20Details) JAKKS Pacific will host a teleconference on July 24, 2025, at 5:00 p.m. ET / 2:00 p.m. PT, with a live webcast and replay available on the company's investor relations website - A teleconference is scheduled for **July 24, 2025**, at **5:00 p.m. ET / 2:00 p.m. PT**[13](index=13&type=chunk) - A live webcast and replay of the call will be available on the 'Investor Relations' page of the Company's website at www.jakks.com/investors[13](index=13&type=chunk) [About JAKKS Pacific, Inc.](index=3&type=section&id=6.2%20About%20JAKKS%20Pacific%2C%20Inc.) JAKKS Pacific, Inc. is a leading global designer, manufacturer, and marketer of toys and consumer products, headquartered in Santa Monica, California, offering popular proprietary brands and entertainment-inspired licensed products - JAKKS Pacific, Inc. is a leading designer, manufacturer, and marketer of toys and consumer products sold throughout the world[14](index=14&type=chunk) - The company's popular proprietary brands include AirTitans®, Disguise®, Perfectly Cute®, and ReDo® Skateboard Co., along with entertainment-inspired licensed products[14](index=14&type=chunk) - JAKKS Pacific is headquartered in Santa Monica, California[14](index=14&type=chunk) [Contact Information](index=3&type=section&id=6.3%20Contact%20Information) Investor relations contact details are provided for inquiries - For investor relations, contact **Lucas Natalini** at **(424) 268-9567** or **investors@jakks.net**[15](index=15&type=chunk) [Condensed Consolidated Financial Statements](index=4&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the condensed consolidated balance sheets, statements of operations, and cash flow data [Condensed Consolidated Balance Sheets](index=4&type=section&id=7.1%20Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows total assets of **$438.7 million** as of June 30, 2025, a notable increase from June 30, 2024, with significant increases in cash and cash equivalents and inventory Condensed Consolidated Balance Sheets (Selected Items, in thousands USD) | Item | June 30, 2025 (Thousands USD) | June 30, 2024 (Thousands USD) | December 31, 2024 (Thousands USD) | | :-------------------------------- | :-------------- | :-------------- | :---------------- | | Cash and cash equivalents | $38,195 | $17,700 | $69,936 | | Restricted cash | $4,861 | $202 | $201 | | Inventory | $71,811 | $51,327 | $52,780 | | Total current assets | $261,931 | $235,692 | $268,687 | | Total assets | $438,718 | $378,251 | $444,869 | | Total current liabilities | $152,833 | $161,757 | $149,420 | | Total liabilities | $201,981 | $182,356 | $204,036 | | Total stockholders' equity | $236,737 | $195,895 | $240,833 | [Supplemental Balance Sheet and Cash Flow Data](index=5&type=section&id=7.2%20Supplemental%20Balance%20Sheet%20and%20Cash%20Flow%20Data) Days Sales Outstanding (DSO) increased to **95 days**, and Inventory Turnover (DSI) significantly rose to **82 days**, with cash flows used in operating, investing, and financing activities contributing to a net decrease in cash for H1 2025 Key Balance Sheet Ratios | Metric | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :-------------- | :-------------- | | Accounts receivable days sales outstanding (DSO) | 95 | 86 | | Inventory turnover (DSI) | 82 | 46 | Condensed Cash Flow Data (Six Months Ended June 30, in thousands USD) | Activity | H1 2025 (Thousands USD) | H1 2024 (Thousands USD) | | :------------------------------------ | :---------- | :---------- | | Cash flows used in operating activities | $(15,585) | $(27,666) | | Cash flows used in investing activities | $(6,361) | $(6,174) | | Cash flows used in financing activities and other | $(5,135) | $(20,812) | | Increase in cash, cash equivalents and restricted cash | $(27,081) | $(54,652) | | Capital expenditures | $(4,816) | $(4,627) | [Condensed Consolidated Statements of Operations](index=6&type=section&id=7.3%20Condensed%20Consolidated%20Statements%20of%20Operations) This section provides detailed income statement data for the three and six months ended June 30, 2025, both in absolute dollar values and as a percentage of net sales [Statements of Operations (Absolute Values)](index=6&type=section&id=7.3.1%20Statements%20of%20Operations%20(Absolute%20Values)) For Q2 2025, net sales decreased by 20%, leading to an 18% drop in gross profit and an operating loss of **$2.8 million**, while H1 2025 saw a 3% net sales decrease but a 14% gross profit increase and narrowed operating loss Q2 and H1 2025 Statements of Operations (Selected Items, in thousands USD) | Metric | Q2 2025 (Thousands USD) | Q2 2024 (Thousands USD) | Q2 Δ (%) | H1 2025 (Thousands USD) | H1 2024 (Thousands USD) | H1 Δ (%) | | :------------------------------------ | :---------- | :---------- | :------- | :---------- | :---------- | :------- | | Net sales | $119,094 | $148,619 | (20)% | $232,347 | $238,695 | (3)% | | Cost of sales | $80,071 | $101,034 | (21)% | $154,311 | $170,058 | (9)% | | Gross profit | $39,023 | $47,585 | (18)% | $78,036 | $68,637 | 14% | | Selling, general and administrative expenses | $41,806 | $39,942 | 5% | $84,576 | $82,318 | 3% | | Income (loss) from operations | $(2,783) | $7,643 | nm | $(6,540) | $(13,681) | (52)% | | Net income (loss) attributable to JAKKS Pacific, Inc. | $(2,319) | $5,266 | nm | $(4,701) | $(9,239) | (49)% | | Earnings (loss) per share - basic | $(0.21) | $0.49 | N/A | $(0.42) | $(0.75) | N/A | [Statements of Operations (Percentage of Net Sales)](index=7&type=section&id=7.3.2%20Statements%20of%20Operations%20(Percentage%20of%20Net%20Sales)) For Q2 2025, gross profit as a percentage of net sales improved to **32.8%**, but increased SG&A expenses led to an operating loss of **2.3%** of net sales, while H1 2025 saw gross profit margin improve substantially to **33.6%** and operating loss margin narrow to **2.8%** Q2 and H1 2025 Statements of Operations (Percentage of Net Sales) | Metric | Q2 2025 (%) | Q2 2024 (%) | Q2 Δ (bps) | H1 2025 (%) | H1 2024 (%) | H1 Δ (bps) | | :------------------------------------ | :---------- | :---------- | :--------- | :---------- | :---------- | :--------- | | Net sales | 100.0% | 100.0% | - | 100.0% | 100.0% | - | | Cost of sales | 67.2% | 68.0% | 80 Fav | 66.4% | 71.2% | 480 Fav | | Gross profit | 32.8% | 32.0% | 80 Fav | 33.6% | 28.8% | 480 Fav | | Selling, general and administrative expenses | 35.1% | 26.9% | (820) Unfav | 36.4% | 34.5% | (190) Unfav | | Income (loss) from operations | (2.3)% | 5.1% | (740) Unfav | (2.8)% | (5.7)% | 290 Fav | | Net income (loss) attributable to JAKKS Pacific, Inc. | (1.9)% | 3.5% | N/A | (2.0)% | (3.9)% | N/A | [Reconciliation of Non-GAAP Financial Information](index=8&type=section&id=7.4%20Reconciliation%20of%20Non-GAAP%20Financial%20Information) This section provides detailed reconciliations of GAAP net income (loss) to non-GAAP measures such as EBITDA, Adjusted EBITDA, and Adjusted Net Income (Loss) for the three and six months ended June 30, 2025, as well as for the trailing twelve months [EBITDA and Adjusted EBITDA (Q2 & H1)](index=8&type=section&id=7.4.1%20EBITDA%20and%20Adjusted%20EBITDA%20(Q2%20%26%20H1)) For Q2 2025, Adjusted EBITDA significantly decreased to **$2.3 million** from **$12.3 million** in Q2 2024, while H1 2025 Adjusted EBITDA improved to **$2.7 million** from a negative **$4.9 million** in H1 2024 Q2 and H1 2025 EBITDA and Adjusted EBITDA (in thousands USD) | Metric | Q2 2025 (Thousands USD) | Q2 2024 (Thousands USD) | Q2 Δ (Thousands USD) | H1 2025 (Thousands USD) | H1 2024 (Thousands USD) | H1 Δ (Thousands USD) | | :-------------------- | :---------- | :---------- | :------- | :---------- | :---------- | :------- | | Net income (loss) | $(2,319) | $5,266 | $(7,585) | $(4,701) | $(8,959) | $4,258 | | EBITDA | $(1,275) | $9,849 | $(11,124) | $(3,468) | $(9,823) | $6,355 | | Adjusted EBITDA | $2,305 | $12,296 | $(9,991) | $2,659 | $(4,939) | $7,598 | | Adjusted EBITDA/Net sales % | 1.9% | 8.3% | (640) bps | 1.1% | (2.1)% | 320 bps | [Trailing Twelve Months (TTM) Adjusted EBITDA and Adjusted Net Income](index=9&type=section&id=7.4.2%20Trailing%20Twelve%20Months%20(TTM)%20Adjusted%20EBITDA%20and%20Adjusted%20Net%20Income) This section details TTM Adjusted EBITDA and Q2/H1 2025 Adjusted Net Income, highlighting performance trends TTM Adjusted EBITDA (in thousands USD) | Metric | TTM June 30, 2025 (Thousands USD) | TTM June 30, 2024 (Thousands USD) | TTM Δ (Thousands USD) | | :-------------------------- | :------------------ | :------------------ | :-------- | | TTM net income | $38,458 | $28,290 | $10,168 | | TTM EBITDA | $56,387 | $41,921 | $14,466 | | TTM Adjusted EBITDA | $66,863 | $51,203 | $15,660 | | TTM Adjusted EBITDA/TTM Net sales % | 9.8% | 7.6% | 220 bps | Adjusted Net Income (Loss) Attributable to Common Stockholders (in thousands USD, except per share data) | Metric | Q2 2025 (Thousands USD) | Q2 2024 (Thousands USD) | Q2 Δ (Thousands USD) | H1 2025 (Thousands USD) | H1 2024 (Thousands USD) | H1 Δ (Thousands USD) | | :------------------------------------ | :---------- | :---------- | :------- | :---------- | :---------- | :------- | | Adjusted net income (loss) attributable to common stockholders | $390 | $7,255 | $(6,865) | $36 | $(4,002) | $4,038 | | Adjusted earnings (loss) per share - basic | $0.03 | $0.67 | $(0.64) | $0.00 | $(0.38) | $0.38 | [Net Sales by Division and Geographic Region](index=10&type=section&id=7.5%20Net%20Sales%20by%20Division%20and%20Geographic%20Region) This section provides a detailed breakdown of net sales by product division and geographic region for Q2 and H1 2025, with comparative data for previous periods Net Sales by Division (in thousands USD) | Division | Q2 2025 (Thousands USD) | Q2 2024 (Thousands USD) | Q2 Δ (%) | H1 2025 (Thousands USD) | H1 2024 (Thousands USD) | H1 Δ (%) | | :---------------------- | :---------- | :---------- | :------- | :---------- | :---------- | :------- | | Toys/Consumer Products | $80,379 | $104,570 | (23.1)% | $187,817 | $187,480 | 0.2% | | Dolls, Role Play/Dress-Up | $46,164 | $63,608 | (27.4)% | $101,627 | $104,182 | (2.5)% | | Action Play & Collectibles | $29,902 | $36,555 | (18.2)% | $72,783 | $69,563 | 4.6% | | Outdoor/Seasonal Toys | $4,313 | $4,407 | (2.1)% | $13,407 | $13,735 | (2.4)% | | Costumes | $38,715 | $44,049 | (12.1)% | $44,530 | $51,215 | (13.1)% | | Total | $119,094 | $148,619 | (19.9)% | $232,347 | $238,695 | (2.7)% | Net Sales by Geographic Region (in thousands USD) | Region | Q2 2025 (Thousands USD) | Q2 2024 (Thousands USD) | Q2 Δ (%) | H1 2025 (Thousands USD) | H1 2024 (Thousands USD) | H1 Δ (%) | | :---------------------- | :---------- | :---------- | :------- | :---------- | :---------- | :------- | | United States | $86,990 | $125,837 | (30.9)% | $175,934 | $196,267 | (10.4)% | | Europe | $14,657 | $10,264 | 42.8% | $26,467 | $15,999 | 65.4% | | Latin America | $6,047 | $3,239 | 86.7% | $13,506 | $11,235 | 20.2% | | Canada | $8,826 | $6,288 | 40.4% | $12,105 | $9,658 | 25.3% | | Asia | $1,448 | $1,268 | 14.2% | $2,199 | $2,233 | (1.5)% | | Australia & New Zealand | $886 | $1,607 | (44.9)% | $1,499 | $2,953 | (49.2)% | | Middle East & Africa | $240 | $116 | 106.9% | $637 | $350 | 82.0% | | Total | $119,094 | $148,619 | (19.9)% | $232,347 | $238,695 | (2.7)% | - Rest of World (International) sales showed strong growth in both Q2 (**41.1%**) and H1 (**35.2%**), partially offsetting declines in North America[27](index=27&type=chunk)

Core Viewpoint - Jakks Pacific reported quarterly earnings of $0.03 per share, significantly beating the Zacks Consensus Estimate of a loss of $0.38 per share, although this is a decline from earnings of $0.65 per share a year ago, indicating a notable earnings surprise of +107.89% [1] Financial Performance - The company posted revenues of $119.09 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 7.8% and down from $148.62 million in the same quarter last year [2] - Over the last four quarters, Jakks has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Performance - Jakks shares have declined approximately 26.2% since the beginning of the year, contrasting with the S&P 500's gain of 8.1% [3] - The current Zacks Rank for Jakks is 5 (Strong Sell), indicating expectations of underperformance in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $3.52 on revenues of $315.72 million, and for the current fiscal year, it is $2.34 on revenues of $691.25 million [7] - The trend of estimate revisions for Jakks was unfavorable prior to the earnings release, which may impact future stock movements [5][6] Industry Context - The Toys - Games - Hobbies industry, to which Jakks belongs, is currently ranked in the bottom 6% of over 250 Zacks industries, suggesting a challenging environment for the company [8]

Financial Data and Key Metrics Changes - Sales in Q2 2025 were down 20% compared to the prior year, with first half sales down 3% overall [6][11] - U.S. sales decreased by 10% year-over-year, while all other markets experienced a 33% increase [6][12] - Adjusted EBITDA for the quarter was $2.3 million, down from $12.3 million in the same quarter last year, but up from a loss of $4.9 million in the first half of last year [21] - Adjusted diluted EPS was $0.03 per share in the quarter, unfavorable compared to $0.65 per share last year [21] Business Line Data and Key Metrics Changes - Worldwide toy and consumer business was down 23% in the quarter, while the costume business was down 12% [11][12] - International growth was led by Europe, which grew by 65% in the first half of the year [12][25] - The company is focusing on maintaining a lean inventory, with a decrease of 8% year-over-year in the U.S. while international inventory is higher [45][62] Market Data and Key Metrics Changes - The company has seen limited increases in consumer prices in the U.S., but there are concerns about reduced unit sales due to these price hikes [10][11] - Major U.S. customers are delaying traditional second half planogram resets, impacting the productivity of new product introductions [26] Company Strategy and Development Direction - The company is taking a proactive approach to its manufacturing strategy, diversifying supply chains to mitigate risks associated with tariffs [7][8] - There is a focus on cash generation and prudent inventory management, especially in the U.S. market [45][72] - The company is exploring acquisition opportunities and remains cautiously optimistic about future growth despite current economic uncertainties [24][72] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the unpredictability of the U.S. market due to ongoing tariff changes and is adapting strategies accordingly [5][6] - There is a cautious outlook for the second half of the year, with a focus on profitability and cash generation rather than aggressive sales targets [50][51] - The company is optimistic about the upcoming holiday season, particularly with new product launches and strong consumer interest in established franchises [27][31] Other Important Information - The Board has approved a $0.25 per share dividend for the third quarter [21] - The company completed refinancing its credit facility, providing a predictable source of funds at attractive borrowing rates [20] Q&A Session Summary Question: Short-term levers to mitigate tariff impacts - The company is implementing a duplicate tool initiative to allow flexibility in manufacturing locations to reduce tariff impacts [38] Question: Adjustments to the supply chain - The company is focusing on manufacturing certain products outside of China, particularly in Vietnam, while maintaining quality and efficiency [40][41] Question: Comments on full year 2025 outlook - The company is taking a cautious approach, focusing on sell-through rates and profitability rather than aggressive inventory builds [49][50] Question: Potential for empty shelves during the holiday period - Management believes retailers will focus on proven products and lower price points, with a wait-and-see approach during the Halloween period [54]

Financial Performance - Q2 2025 - Net sales decreased by 19.9% year-over-year to $119.1 million, compared to $148.6 million in Q2 2024 [10, 60, 61] - Gross profit decreased by 18% to $39.0 million, compared to $47.6 million in Q2 2024 [10, 48] - Operating loss was $2.8 million, compared to an operating income of $7.6 million in Q2 2024 [10] - Adjusted EBITDA decreased to $2.3 million, compared to $12.3 million in Q2 2024 [10] - Adjusted net income attributable to common stockholders was $0.4 million (or $0.03 per share), compared to $7.3 million (or $0.65 per share) in Q2 2024 [10] - Gross margin increased to 32.8%, up from 32.0% in Q2 2024 [10, 20] Financial Performance - First Half 2025 - Net sales decreased by 2.7% year-over-year to $232.3 million, compared to $238.7 million in 1H 2024 [10, 60, 61] - Gross profit increased by 14% to $78.0 million, compared to $68.6 million in 1H 2024 [10, 48] - Operating loss decreased to $6.5 million, compared to an operating loss of $13.7 million in 1H 2024 [10] - Adjusted EBITDA increased to $2.7 million, up from a loss of $4.9 million in 2024 [10] - Gross margin increased to 33.6%, up from 28.8% in 1H 2024 [10, 32] Sales by Division - Q2 2025 - Toys/Consumer Products net sales decreased by 23.1% to $80.4 million, compared to $104.6 million in Q2 2024 [14, 60] - Costumes net sales decreased by 12.1% to $38.7 million, compared to $44.0 million in Q2 2024 [18, 60] Sales by Region - Q2 2025 - United States net sales decreased by 30.9% to $87.0 million, compared to $125.8 million in Q2 2024 [61] - Europe net sales increased by 42.8% to $14.7 million, compared to $10.3 million in Q2 2024 [61]

Core Viewpoint - JAKKS Pacific, Inc. reported a significant decline in net sales for the second quarter of 2025, primarily driven by a 31% drop in U.S. sales, while international sales showed growth, particularly in the Rest of World segment, which increased by 41% compared to the previous year [6][11]. Financial Performance - Net sales for Q2 2025 were $119.1 million, a decrease of 20% from $148.6 million in Q2 2024 [6][11]. - The Toys/Consumer Products segment saw a global sales decline of 23% to $80.4 million, while Costumes sales decreased by 12% to $38.7 million [6][11]. - For the first half of 2025, net sales totaled $232.3 million, down 3% from $238.7 million in the same period last year [7][11]. Geographic Sales Breakdown - U.S. sales for Q2 2025 were $87.0 million, down 31% from $125.8 million in Q2 2024 [6][11]. - Sales in the Rest of World segment reached $32.1 million, up 41% from $22.8 million in Q2 2024 [6][11]. - For the first half of 2025, U.S. sales were $175.9 million, down 10% from $196.3 million, while Rest of World sales increased by 33% to $56.4 million from $42.4 million [7][11]. Profitability Metrics - Gross profit for Q2 2025 was $39.0 million, down from $47.6 million in Q2 2024, with a gross margin of 32.8%, slightly improved from 32.0% in the prior year [11]. - The company reported an operating loss of $2.8 million for Q2 2025, compared to an operating income of $7.6 million in Q2 2024 [11]. - Adjusted net income attributable to common stockholders was $0.4 million (or $0.03 per share) in Q2 2025, down from $7.3 million (or $0.65 per share) in Q2 2024 [11]. Cash and Inventory Position - As of June 30, 2025, the company's cash and cash equivalents totaled $43.1 million, up from $17.9 million a year earlier, but down from $70.1 million at the end of 2024 [8]. - Inventory levels increased to $71.8 million from $51.3 million a year ago [8]. Management Commentary - The CEO expressed confidence in the company's ability to navigate challenges and emphasized the importance of leveraging experience and relationships to adapt to market conditions [5]. - The refinancing of the credit facility was highlighted as a move to enhance financial resilience and prepare for future opportunities [5].

Core Insights - Disguise, Inc. is launching a new lineup of costumes inspired by NBCUniversal's 2025 film releases, including "Wicked: For Good," "How to Train Your Dragon," "Gabby's Dollhouse: The Movie," and "Jurassic World Rebirth" [1][3] Group 1: Product Launch - The new costume collection will feature detailed costumes and accessories from popular films, set to be available in North America later this year [1] - The "Wicked: For Good" collection will include costumes for characters Glinda and Elphaba, expected to be popular choices for Halloween 2025 [2] - Additional costumes will be launched for the live-action "How to Train Your Dragon," "Gabby's Dollhouse: The Movie," and dinosaur-themed costumes from "Jurassic World Rebirth," appealing to a wide audience [3] Group 2: Company Background - Disguise, Inc. has been a leader in the costume industry since 1987, known for innovative and trend-setting designs, manufacturing millions of costumes annually [5] - The company partners with popular licensed brands and offers original designs, distributing products through major retailers and seasonal pop-ups globally [5] Group 3: Industry Context - Universal Products & Experiences drives the expansion of NBCUniversal's brands and intellectual properties through innovative products and engaging retail experiences [6]

Core Viewpoint - The consumer sector presents attractive growth stock opportunities, particularly as many stocks remain undervalued due to ongoing tariff concerns. Initial investments in these stocks can be beneficial for investors. Group 1: Amazon - Amazon's stock is currently attractively valued despite a rally from its lows, with a record Prime Day generating $24.1 billion in sales, more than double last year's Black Friday sales [3][4] - The company has made significant investments in logistics, automation, and AI, leading to improved operational efficiency and cost savings [4][5] - Amazon Web Services (AWS) continues to lead in cloud computing, with customers utilizing its services for AI model development, supported by custom chips for enhanced performance [5] Group 2: Alibaba - Alibaba's stock trades at a forward P/E of 11, with over 30% of its market cap in cash and investments, indicating it is undervalued [6][8] - The company's cloud business has seen AI-related revenue double for seven consecutive quarters, and partnerships with major companies like Apple could drive growth [6][7] - Alibaba is enhancing its e-commerce platforms and expanding international operations, with expectations of profitability in its international segment soon [7][8] Group 3: E.l.f. Beauty - E.l.f. Beauty's stock has faced a slowdown but is poised for transformation through its acquisition of Rhode, a fast-growing premium brand [9][10] - Rhode generated $212 million in sales with minimal marketing, indicating strong potential for growth as it enters retail partnerships [10][11] - The strategy to integrate premium brands is expected to yield better margins compared to mass-market products, presenting a long-term opportunity [12] Group 4: JAKKS Pacific - JAKKS Pacific has improved operations and profitability under new leadership, with shares up over 200% in five years despite a recent 30% decline due to tariff concerns [13][15] - The company reported a 26% sales increase in Q1, driven by popular licensed products, and is expected to maintain momentum with upcoming launches [14][15] - JAKKS is diversifying revenue through partnerships to create seasonal products, enhancing its market position [15] Group 5: Cava Group - Cava Group's stock is down nearly 50% from its highs, providing a favorable entry point for investors [16][18] - The company has achieved double-digit same-store sales growth for four consecutive quarters, driven by increased customer traffic [16][17] - Cava aims to expand its locations from under 400 to 1,000 by 2032, indicating significant growth potential in the fast-casual dining sector [18]