JAKK

This article first appeared on GuruFocus. - Net Sales (Q3): $254 million, up 20% year-over-year. - Year-to-Date Sales: Up 13% versus prior year. - North America Sales: Up 28% in Q3; up 14% year-to-date. - International Sales: Down 4% in Q3; up 7% year-to-date. - Dolls/Role-Play/Dress-Up: Up 29% in Q3; up 7% year-to-date. - Action, Play & Collectibles: Up 19% in Q3; POS up mid-single-digits year-to-date. - Toys & Consumer Products Shipping: Up 23% in Q3; up 13% year-to-date. - Costumes Business: $62 million in Q3; $111 million year-to-date, slightly ahead of 2024. - FOB Business Model: Over 75% of sales for first nine months. - Gross Margin: 32.1% in Q3, slightly above 32% last year; 20% higher sales delivered 20% more gross margin dollars. - Adjusted EBITDA: $44.4 million in Q3 vs. $36.5 million last year; trailing 12-month adjusted EBITDA $45.7 million, up from $37.8 million last quarter. - Adjusted EPS: $2.68 in Q3 vs. $1.80 last year; $2.81 year-to-date vs. $1.79 last year. - Cash: $45 million in restricted and unrestricted cash vs. $28 million last year. - Inventory: $64 million at quarter end vs. $71 million last year. - Dividend: Quarterly cash dividend of $0.25 per share, payable December 28 to shareholders of record as of November 27. - Warning! GuruFocus has detected 9 Warning Signs with JAKK. - Is JAKK fairly valued? Test your thesis with our free DCF calculator. Release Date: October 22, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. - Q3 net sales increased 20% year-over-year to $254 million, with year-to-date sales up 13%. - North America sales grew 28% in the quarter and 14% year-to-date, driven by strong performance in Dolls and Action Play & Collectibles. - Adjusted EBITDA improved to $44.4 million in Q3 from $36.5 million last year, and adjusted EPS rose to $2.68 from $1.80. - The company maintains a strong balance sheet with $45 million in cash and continues to pay a quarterly dividend of $0.25 per share. - Upcoming 2027 slate includes major theatrical releases like Sonic the Hedgehog 4, The Simpsons movie, and Frozen 3, which are expected to drive growth. - International sales declined 4% in the quarter, with Europe only marginally up and other regions down. - Higher resin and diesel prices are pressuring product costs and supply chain expenses. - Gross margin remained flat at 32.1% due to limited scale benefits and ongoing cost pressures. - Selling expenses are expected to be higher in Q4 as promotional activity increases. - The company is not supporting any new entertainment releases in the toy business this holiday season, which may limit growth compared to years with major movie tie-ins. Q: Can you discuss the international expansion opportunities, including adding accounts and regional growth potential? A: CEO Stephen Berman said expansion is happening aggressively, with the strongest opportunities in EMEA, followed by Latin America and Southeast Asia. JAKKS is deepening its presence in the Middle East and Africa, staffing up in Mexico, Chile and other LATAM territories, and pursuing both mass-market retailers and the large informal/value channel. New warehouses and distribution centers in Italy, Spain, Germany, the U.K. and Rotterdam support faster deliveries, and newly obtained rights covering additional territories should enhance growth in 2027 and 2028. Q: How does the international business compare structurally to the FOB-driven domestic business in terms of margins and smoothing out quarterly results? A: Berman noted that international is roughly 85%90% FOB, but differs from the U.S. because dress-up is an everyday business in Europe and Latin America rather than Halloween-centric, driven by occasions like Carnival, Boxing Day and Kids Day, which helps even out the year. CFO John Kimball added that international margins are comparable to the U.S., and JAKKS is building deeper, multi-channel presences in these markets while still earning nice margins. Q: With a strong balance sheet and tariff noise abating, are you seeing benefits through new licenses and expansion opportunities, and do you want to add even more properties beyond the anime rollout in 2027? A: Berman said JAKKS, now 32 years old, is securing more appropriate licenses that benefit licensors, shareholders, retailers and consumers, and is getting strong growth from existing properties doing more with less. While much of the industry shifts toward adult and collectible products, JAKKS remains a kid-centric business with a big appetite for products for children six months to seven years, which enhances its appeal to licensors. It also participates in adult collectibles through Nintendo, Sonic, The Simpsons and its upcoming anime initiative. Q: Is not supporting any new entertainment releases in the fourth quarter a reflection of timing or being more selective? A: Berman said it is purely timing, as there was nothing truly "toy-rific" launching this year compared with 2027's Sonic, Frozen and Harry Potter content. He highlighted that JAKKS anticipated the lighter content year well in advance and still delivered healthy growth across segments, including a vastly expanded private label business and strong Disney Princess and Frozen sales without major film support, aided by initiatives like the Style Collection and the new Disney Darlings baby doll line. Q: Comparing Q3 2026 with Q3 2024, what would it take to get back to that level of performance? A: Kimball explained that the back half of 2024 featured meaningful entertainment tentpoles, including the Moana 2 and Sonic 3 movies, which JAKKS rallied behind. Q3 2026 showed solid evergreen growth, as reflected in the supplemental earnings deck's breakout of content versus evergreen, but the company is not supporting a huge fall movie this year beyond its continued major push behind Mario Galaxy. Q: Are tariff refunds now fully behind the company? A: CFO John Kimball confirmed that JAKKS is done with tariff refunds. Q: What is your view on Toys R Us and its reopening stores? A: Berman called Toys R Us a lovely name and company, noting it is being licensed to a familiar operator opening about 120 stores during the holiday season, many as pop-ups. JAKKS is selling to them and rooting for a successful comeback in the right format, hoping the stores evolve from pop-ups into full-time, year-round locations. Q: What drove the 20% net sales increase in Q3 to $254 million, and what is the year-to-date picture? A: Berman said Q3 net sales rose 20% over a prior year that featured delayed planogram sets and higher U.S. tariffs, with year-to-date sales up 13%. Growth was led by North America, up 28% in the quarter and 14% year-to-date, while international was down 4% in the quarter but still up 7% year-to-date. The Dolls role-play dress-up business grew 29% in the quarter, Action Play and Collectibles rose 19%, and overall toys and consumer products shipping was up 23% in the quarter and 13% year-to-date. Q: How did margins and profitability trend in the quarter? A: Kimball reported gross margin of 32.1%, slightly above last year's 32%, with 20% higher sales delivering 20% more gross margin dollars. Adjusted EBITDA was $44.4 million versus $36.5 million in Q3 last year, lifting trailing 12-month adjusted EBITDA to $45.7 million from $37.8 million last quarter. Adjusted EPS was $2.68 versus $1.80 a year ago, and year-to-date adjusted EPS reached $2.81 versus $1.79. Q: What is the status of the balance sheet, inventory and dividend? A: Kimball said the company finished the quarter with $45 million in restricted and unrestricted cash, up from $28 million a year earlier. Inventory was $64 million versus $71 million last year, reflecting a slightly higher balance outside the U.S. The board approved a quarterly cash dividend of $0.25 per share, payable December 28 to shareholders of record as of November 27. Q: How is the costumes business performing ahead of Halloween? A: Berman said the costumes business had a solid quarter at $62 million and $111 million year-to-date, tracking slightly ahead of 2024 as it recovers from last year's disruptions. Most U.S. accounts were up double-digits, and JAKKS is seeing traction in Europe with new accounts and more year-round business. Netflix's K-Pop Demon Hunters has been in high demand, with content lifts from Disney's Descendants 5 and Pixar's Toy Story 5, plus growth in Super Mario, Sonic and Harry Potter. Q: What are the key product initiatives and areas of focus for 2027 and beyond? A: Berman highlighted a strong 2027 theatrical slate including Sonic the Hedgehog 4 in March, the new Simpsons movie in September and Frozen For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Jakks Pacific (JAKK) came out with quarterly earnings of $2.68 per share, beating the Zacks Consensus Estimate of $2.54 per share. This compares to earnings of $1.8 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +5.51%. A quarter ago, it was expected that this toymaker would post earnings of $0.25 per share when it actually produced earnings of $0.25, delivering no surprise. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Jakks, which belongs to the Zacks Toys - Games - Hobbies industry, posted revenues of $254.22 million for the quarter ended September 2026, surpassing the Zacks Consensus Estimate by 4.14%. This compares to year-ago revenues of $211.21 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Jakks shares have added about 73.4% since the beginning of the year versus the S&P 500's gain of 13.3%. While Jakks has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Jakks was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.15 on $130.56 million in revenues for the coming quarter and $2.47 on $620.59 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Toys - Games - Hobbies is currently in the top 43% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Funko-A (FNKO), another stock in the same industry, has yet to report results for the quarter ended September 2026. The results are expected to be released on November 5. This company is expected to post quarterly earnings of $0.13 per share in its upcoming report, which represents a year-over-year change of +116.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Funko-A's revenues are expected to be $252 million, up 0.4% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report JAKKS Pacific, Inc. (JAKK) : Free Stock Analysis Report Funko, Inc. (FNKO) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Net sales up 20% in Q3 compared to prior year; Board approves cash dividend SANTA MONICA, Calif., Oct. 22, 2026 (GLOBE NEWSWIRE) -- JAKKS Pacific, Inc. (Nasdaq: JAKK) today reported financial results for the third quarter ended September 30, 2026. Third Quarter 2026 - Net sales were $254.2 million, a year-over-year increase of 20% - Toys/Consumer Products net sales were $192.0 million, up 23% from $156.1 million last year - Costumes net sales were $62.2 million, a year-over-year increase of 13% - Gross margin of 32.1%, up 10 basis points vs. Q3 2025 - Gross profit of $81.5 million, up 20% compared to $67.6 million in Q3 2025 - Operating income of $37.4 million, compared to $29.4 million in Q3 2025, a year-over-year increase of 27% - Net income attributable to common stockholders of $29.9 million or $2.48 per diluted share, compared to net income attributable to common stockholders of $19.9 million or $1.74 per diluted share in Q3 2025 - Adjusted net income attributable to common stockholders (a non-GAAP measure) of $32.3 million or $2.68 per diluted share, compared to adjusted net income attributable to common stockholders of $20.6 million or $1.80 per diluted share in Q3 2025 - Adjusted EBITDA (a non-GAAP measure) of $44.4 million vs. $36.5 million in Q3 2025 - Trailing-twelve-month Adjusted EBITDA of $45.7 million, up from $37.8 million as of Q2 2026 Management Commentary "We're very happy with our Q3 results as we approach the end of the year. Having successfully navigated the high tariff turmoil, we are driving our business forward. We see that reflected in our current results, the line-up we recently shared with the trade for 2027 and new initiatives we're in the process of securing for 2028," said Stephen Berman, Chairman and CEO of JAKKS Pacific. "We have great placement this holiday season and our international business continues to steadily expand as we continue to open new accounts and partner more closely for a more robust presence in-store." Third Quarter Results Net Sales in North America were $209 million, up 28% in the quarter compared to the previous year. International Sales were $45 million, down from $47 million last year (a 4% decrease). North America and International are up 14% and 7% respectively, year-to-date. Globally, Dolls, Role-Play, Dress-Up net sales were $119 million, compared to $92 million in 2025, an increase of 29%. Action Play & Collectibles net sales were $63 million in the quarter, up from $53 million in 2025, a 19% increase. Costumes net sales were $62 million, compared to $55 million (a 13% increase) in 2025. Costumes are up 11% year-to-date. Inventory was $63.8 million as of September 30, 2026, compared to $71.5 million as of September 30, 2025, and $59.8 million as of December 31, 2025. Cash (including restricted cash and cash equivalents) was $45.1 million as of September 30, 2026, compared to $27.8 million as of September 30, 2025, and $54.1 million as of December 31, 2025. The Board of Directors declared a quarterly dividend of $0.25 per share on the company's common stock, payable December 28th, 2026, to shareholders of record November 27th, 2026. Use of Non-GAAP Financial Information and Reconciliation of GAAP to Non-GAAP measures: In addition to the preliminary results reported in accordance with U.S. GAAP included in this release, the Company has provided certain non-GAAP financial information including Adjusted EBITDA and Adjusted Net Income (Loss) that exclude various items that are detailed in the financial tables and accompanying footnotes reconciling GAAP to non-GAAP results contained in this release. The non-GAAP financial measures included in the press release are reconciled to the corresponding GAAP financial measures below, as required under the rules of the Securities and Exchange Commission regarding the use of non-GAAP financial measures. We define Adjusted EBITDA as income (loss) from operations before depreciation, amortization and adjusted for certain non-recurring and non-cash charges, such as reorganization expenses and restricted stock compensation expense Net income (loss) is similarly adjusted and tax-effected to arrive at Adjusted Net Income (Loss). Adjusted EBITDA and Adjusted Net Income (Loss) are not recognized financial measures under GAAP, but we believe that they are useful in measuring our operating performance, enhance an overall understanding of the Company's past financial performance, and provides useful information to the investor by comparing our performance across reporting periods on a consistent basis. Investors should not consider these measures in isolation or as a substitute for net income, operating income, or any other measure for determining the Company's operating performance that is calculated in accordance with GAAP. In addition, because these measures are not calculated in accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other companies. The non-GAAP financial measures included in the press release are reconciled to the corresponding GAAP financial measures below, as required under the rules of the Securities and Exchange Commission regarding the use of non-GAAP financial measures. See "Use of Non-GAAP Financial Information" for additional disclosures with respect to the use of non-GAAP financial information. Conference Call Live Webcast JAKKS Pacific, Inc. invites analysts, investors and media to listen to the teleconference scheduled for 5:00 p.m. ET / 2:00 p.m. PT on October 22, 2026. A live webcast of the call will be available on the "Investor Relations" page of the Company's website at www.jakks.com/investors. To access the call by phone, please go to this link (3Q26 Registration link), and you will be provided with dial-in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time. A replay of the webcast will also be available for a limited time at (www.jakks.com/investors). About JAKKS Pacific, Inc. JAKKS Pacific, Inc. is a leading designer, manufacturer and marketer of toys, costumes and consumer products sold throughout the world, with its headquarters in Santa Monica, California. JAKKS Pacific's popular proprietary brands include Disguise®, Fly Wheels®, Charming™, Moose Mountain®, Maui®, ReDo Skateboard Co.®, Sky Ball®, and Xtreme Power Dozer™ as well as a wide range of entertainment-inspired products featuring premier licensed properties. Through their products and charitable donations, JAKKS is helping to make a positive impact on the lives of children. Visit us at www.jakks.com and follow us on Instagram (@jakkspacific.toys), X (@jakkstoys), YouTube (@JAKKSPacific), Facebook (@jakkspacific.toys) and LinkedIn (JAKKS Pacific). Forward Looking Statements This press release may contain "forward-looking statements" (within the meaning of the Private Securities Litigation Reform Act of 1995) that are based on current expectations, estimates and projections about JAKKS Pacific's business based partly on assumptions made by its management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such statements due to numerous factors, including, but not limited to, those described above, changes in demand for JAKKS Pacific's products, product mix, the timing of customer orders and deliveries, the impact of competitive products, tariff policy and pricing, or any future transactions will result in future growth or success of JAKKS. The "forward-looking statements" contained herein speak only as of the date on which they are made, and JAKKS undertakes no obligation to update any of them to reflect events or circumstances after the date of this release. CONTACT: JAKKS Pacific Investor Relations (424) 268-9567 Lucas Natalini [email protected] JAKKS Pacific, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) | | | | | | | | | | | | | | | | September 30, | | December 31, | | | | | | | | 2026 | | | | | 2025 | | | | 2025 | | | | | | | | (In thousands) | | Assets | | | | | Current assets: | | | | | | | | | | Cash and cash equivalents | | $ | 43,999 | | | | $ | 25,887 | | | $ | 52,197 | | | | Restricted cash | | | 1,133 | | | | | 1,869 | | | | 1,869 | | | | Accounts receivable, net | | | 240,294 | | | | | 195,779 | | | | 138,341 | | | | Inventory, net | | | 63,770 | | | | | 71,497 | | | | 59,805 | | | | Prepaid expenses and other assets | | | 13,359 | | | | | 19,784 | | | | 16,873 | | | | | Total current assets | | | 362,555 | | | | | 314,816 | | | | 269,085 | | | | | | | | | | | | | | | Property and equipment | | | 163,246 | | | | | 147,745 | | | | 152,224 | | | Less accumulated depreciation and amortization | | 141,121 | | | | | 131,226 | | | | 133,216 | | | | Property and equipment, net | | | 22,125 | | | | | 16,519 | | | | 19,008 | | | | | | | | | | | | | | | Operating lease right-of-use assets, net | | | 37,835 | | | | | 49,611 | | | | 46,776 | | | Deferred income tax assets, net | | | 69,589 | | | | | 67,612 | | | | 69,569 | | | Goodwill | | | 34,956 | | | | | 35,081 | | | | 35,077 | | | Other long-term assets | | | 1,729 | | | | | 1,631 | | | | 2,682 | | | | | Total assets | | $ | 528,789 | | | | $ | 485,270 | | | $ | 442,197 | | | | | | | | | | | | | | | | | | | | | | | | | | | Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | | | | Current liabilities: | | | | | | | | | | Accounts payable | | $ | 96,507 | | | | $ | 72,338 | | | $ | 55,558 | | | | Accrued expenses | | | 60,129 | | | | | 52,085 | | | | 43,076 | | | | Reserve for sales returns and allowances | | | 40,810 | | | | | 37,691 | | | | 33,569 | | | | Income taxes payable | | | 4,445 | | | | | 5,389 | | | | 2,119 | | | | Short-term operating lease liabilities | | | 14,707 | | | | | 13,504 | | | | 13,784 | | | | | Total current liabilities | | | 216,598 | | | | | 181,007 | | | | 148,106 | | | | | | | | | | | | | | | Long-term operating lease liabilities | | | 28,405 | | | | | 43,113 | | | | 39,578 | | | Accrued expenses, long term | | | 5,486 | | | | | 3,503 | | | | 4,463 | | | Income taxes payable | | | 992 | | | | | 1,732 | | | | 945 | | | | | Total liabilities | | | 251,481 | | | | | 229,355 | | | | 193,092 | | | | | | | | | | | | | | | Stockholders' equity: | | | | | | | | | | Common stock, $.001 par value | | | 11 | | | | | 11 | | | | 11 | | | | Additional paid-in capital | | | 310,211 | | | | | 301,098 | | | | 302,408 | | | | Accumulated deficit | | | (18,122 | ) | | | | (32,875 | ) | | | (41,021 | ) | | | Accumulated other comprehensive loss | | | (14,792 | ) | | | | (12,319 | ) | | | (12,293 | ) | | | | Total stockholders' equity | | | 277,308 | | | | | 255,915 | | | | 249,105 | | | | | Total liabilities and stockholders' equity | $ | 528,789 | | | | $ | 485,270 | | | $ | 442,197 | | | | | | | | | | | | | | | | | | | | | | | | | | | Supplemental Balance Sheet and Cash Flow Data (Unaudited) | | | | | September 30, | | | | Key Balance Sheet Data: | | | 2026 | | | | | 2025 | | | | | | | | | | | | | | | | | Accounts receivable days sales outstanding (DSO) | | 87 | | | | | 85 | | | | | Inventory turnover (DSI) | | | 34 | | | | | 46 | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended September 30, | | Trailing Twelve Months (*) Ended September 30, | | | | | Condensed Cash Flow Data: | | | 2026 | | | | | 2025 | | | | 2026 | | | | 2025 | | | | | | | | | | | | | Cash flows from (used in) operating activities | $ | 17,430 | | | | $ | (24,753 | ) | | $ | 50,675 | | | $ | 29,375 | Cash flows used in investing activities | | | (13,817 | ) | | | | (9,670 | ) | | | (16,491 | ) | | | (13,570 | ) Cash flows used in financing activities and other | | (12,547 | ) | | | | (7,958 | ) | | | (16,808 | ) | | | (10,333 | ) Net increase (decrease) in cash, cash equivalents and restricted cash | | $ | (8,934 | ) | | | $ | (42,381 | ) | | $ | 17,376 | | | $ | 5,472 | | | | | | | | | | | | | Capital expenditures | | $ | (13,226 | ) | | | $ | (7,850 | ) | | $ | (14,939 | ) | | $ | (14,469 | ) | | | | | | | | | | | | (*) Trailing twelve months (TTM) amounts are calculated as the sum of the most recent four quarters, derived from reported GAAP results. | | | | | | | | | | | | | | JAKKS Pacific, Inc. and Subsidiaries | | | | Condensed Consolidated Statements of Operations (Unaudited) | | | | | Three Months Ended September 30, | | | | | Nine Months Ended September 30, | | | | | | | | | | | | | | | | | | 2026 | | | | | 2025 | | | Δ (%) | | | | 2026 | | | | | 2025 | | | Δ (%) | | | | | (In thousands, except per share data) | | | | | (In thousands, except per share data) | | | | | | | | | | | | | | | | | | | | | | Net sales | $ | 254,222 | | | | $ | 211,210 | | | 20 | | % | | $ | 500,136 | | | | $ | 443,557 | | | 13 | | % | Less: Cost of sales | | | | | | | | | | | | | | | | | Cost of goods | | 127,611 | | | | | 104,846 | | | 22 | | | | | 248,571 | | | | | 218,256 | | | 14 | | | | Royalty expense | | 41,287 | | | | | 34,099 | | | 21 | | | | | 81,272 | | | | | 71,776 | | | 13 | | | | Amortization of tools and molds | | 3,824 | | | | | 4,622 | | | (17 | ) | | | | 8,226 | | | | | 7,846 | | | 5 | | | | Cost of sales | | 172,722 | | | | | 143,567 | | | 20 | | | | | 338,069 | | | | | 297,878 | | | 13 | | | | | Gross profit | | 81,500 | | | | | 67,643 | | | 20 | | | | | 162,067 | | | | | 145,679 | | | 11 | | | Direct selling expenses | | 7,561 | | | | | 5,933 | | | 27 | | | | | 24,225 | | | | | 21,339 | | | 14 | | | General and administrative expenses | | 36,388 | | | | | 32,200 | | | 13 | | | | | 105,694 | | | | | 101,135 | | | 5 | | | Depreciation and amortization | | 178 | | | | | 147 | | | 21 | | | | | 491 | | | | | 382 | | | 29 | | | | Selling, general and administrative expenses | | 44,127 | | | | | 38,280 | | | 15 | | | | | 130,410 | | | | | 122,856 | | | 6 | | | | | Income from operations | | 37,373 | | | | | 29,363 | | | 27 | | | | | 31,657 | | | | | 22,823 | | | 39 | | | Other income (expense): | | | | | | | | | | | | | | | | | Other income (expense), net | | 48 | | | | | 388 | | | (88 | ) | | | | 7,049 | | | | | 418 | | | nm | | | Loss on debt extinguishment | | - | | | | | (1 | ) | | nm | | | | - | | | | | (418 | ) | | nm | | | Interest income | | 261 | | | | | 75 | | | 248 | | | | | 1,529 | | | | | 832 | | | 84 | | | | Interest expense | | (60 | ) | | | | (102 | ) | | (41 | ) | | | | (175 | ) | | | | (402 | ) | | (56 | ) | | Income before provision for income taxes | | 37,622 | | | | | 29,723 | | | 27 | | | | | 40,060 | | | | | 23,253 | | | 72 | | | Provision for income taxes | | 7,723 | | | | | 9,831 | | | (21 | ) | | | | 8,578 | | | | | 8,062 | | | 6 | | | Net income | | 29,899 | | | | | 19,892 | | | 50 | | | | | 31,482 | | | | | 15,191 | | | 107 | | | | Earnings per share - basic | $ | 2.61 | | | | $ | 1.78 | | | | | | $ | 2.75 | | | | $ | 1.36 | | | | | | Shares used in earnings per share - basic | | 11,450 | | | | | 11,185 | | | | | | | 11,446 | | | | | 11,159 | | | | | | Earnings per share - diluted | $ | 2.48 | | | | $ | 1.74 | | | | | | $ | 2.65 | | | | $ | 1.32 | | | | | | Shares used in earnings per share - diluted | | 12,051 | | | | | 11,423 | | | | | | | 11,869 | | | | | 11,487 | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | | | | Nine Months Ended September 30, | | | | | | | | | | | | | | | | | | 2026 | | | | | 2025 | | | Δ bps | | | | 2026 | | | | | 2025 | | | Δ bps | | | | | | | | | | Fav/(Unfav) | | | | | | | Fav/(Unfav) | Net sales | | 100.0 | | % | | | 100.0 | | % | - | | | | | 100.0 | | % | | | 100.0 | | % | - | | | Less: Cost of sales | | | | | | | | | | | | | | | | | Cost of goods | | 50.2 | | | | | 49.6 | | | (60 | ) | | | | 49.7 | | | | | 49.2 | | | (50 | ) | | | Royalty expense | | 16.2 | | | | | 16.2 | | | 0 | | | | | 16.3 | | | | | 16.2 | | | (10 | ) | | | Amortization of tools and molds | | 1.5 | | | | | 2.2 | | | 70.0 | | | | | 1.6 | | | | | 1.8 | | | 20 | | | | Cost of sales | | 67.9 | | | | | 68.0 | | | 10 | | | | | 67.6 | | | | | 67.2 | | | (40 | ) | | | | Gross profit | | 32.1 | | | | | 32.0 | | | 10 | | | | | 32.4 | | | | | 32.8 | | | (40 | ) | | Direct selling expenses | | 3.0 | | | | | 2.8 | | | (20 | ) | | | | 4.9 | | | | | 4.8 | | | (10 | ) | | General and administrative expenses | | 14.3 | | | | | 15.2 | | | 90 | | | | | 21.1 | | | | | 22.8 | | | 170 | | | Depreciation and amortization | | 0.1 | | | | | 0.1 | | | - | | | | | 0.1 | | | | | 0.1 | | | - | | | | Selling, general and administrative expenses | | 17.4 | | | | | 18.1 | | | 70 | | | | | 26.1 | | | | | 27.7 | | | 160 | | | | | Income from operations | | 14.7 | | | | | 13.9 | | | 80 | | | | | 6.3 | | | | | 5.1 | | | 120 | | | Other income (expense): | | | | | | | | | | | | | | | | | Other income (expense), net | | - | | | | | 0.2 | | | | | | | 1.4 | | | | | 0.1 | | | | | | Loss on debt extinguishment | | - | | | | | - | | | | | | | - | | | | | (0.1 | ) | | | | | Interest income | | 0.1 | | | | | - | | | | | | | 0.3 | | | | | 0.2 | | | | | | Interest expense | | - | | | | | - | | | | | | | - | | | | | (0.1 | ) | | | | Income before provision for income taxes | | 14.8 | | | | | 14.1 | | | | | | | 8.0 | | | | | 5.2 | | | | | Provision for income taxes | | 3.0 | | | | | 4.7 | | | | | | | 1.7 | | | | | 1.8 | | | | | Net income | | 11.8 | | % | | | 9.4 | | % | | | | | 6.3 | | % | | | 3.4 | | % | | | | | | | | | | | | | | | | | | | | | JAKKS Pacific, Inc. and Subsidiaries Reconciliation of Non-GAAP Financial Information (Unaudited) | | Three Months Ended September 30, | | | | | | Nine Months Ended September 30, | | | | | | | | | | | | | | | | | 2026 | | | | 2025 | | | Δ ($) | | | | | 2026 | | | | 2025 | | | Δ ($) | | | | (In thousands) | | | | | | (In thousands) | | | | EBITDA and Adjusted EBITDA | | | | | | | | | | | | | | | | Net income | | $ | 29,899 | | | $ | 19,892 | | | $ | 10,007 | | | | | $ | 31,482 | | | $ | 15,191 | | | $ | 16,291 | | | Interest expense | | | 60 | | | | 102 | | | | (42 | ) | | | | | 175 | | | | 402 | | | | (227 | ) | | Interest income | | | (261 | ) | | | (75 | ) | | | (186 | ) | | | | | (1,529 | ) | | | (832 | ) | | | (697 | ) | | Provision for income taxes | | | 7,723 | | | | 9,831 | | | | (2,108 | ) | | | | | 8,578 | | | | 8,062 | | | | 516 | | | Depreciation and amortization | | | 4,002 | | | | 4,769 | | | | (767 | ) | | | | | 8,717 | | | | 8,228 | | | | 489 | | | EBITDA | | | 41,423 | | | | 34,519 | | | | 6,904 | | | | | | 47,423 | | | | 31,051 | | | | 16,372 | | | Adjustments: | | | | | | | | | | | | | | | | Loss from joint ventures (JAKKS Pacific, Inc. - 51%) | | - | | | | - | | | | - | | | | | | - | | | | - | | | | - | | | Loss from joint ventures (Meisheng - 49%) | | | - | | | | - | | | | - | | | | | | - | | | | - | | | | - | | | Other (income) expense, net | | | (48 | ) | | | (388 | ) | | | 340 | | | | | | (7,049 | ) | | | (418 | ) | | | (6,631 | ) | | Restricted stock compensation expense | | | 3,043 | | | | 2,392 | | | | 651 | | | | | | 9,122 | | | | 8,132 | | | | 990 | | | Change in fair value of preferred stock derivative liability | | | - | | | | - | | | | - | | | | | | - | | | | - | | | | - | | | Employee Retention Credit/gov't employment support | | - | | | | - | | | | - | | | | | | - | | | | - | | | | - | | | Molds and tooling capitalization | | | - | | | | - | | | | - | | | | | | - | | | | - | | | | - | | | Loss on debt extinguishment | | | - | | | | 1 | | | | (1 | ) | | | | | - | | | | 418 | | | | (418 | ) | | Adjusted EBITDA | | $ | 44,418 | | | $ | 36,524 | | | $ | 7,894 | | | | | $ | 49,496 | | | $ | 39,183 | | | $ | 10,313 | | | Adjusted EBITDA/Net sales % | | | 17.5 | | % | | 17.3 | | % | 20 bps | | | | | 9.9 | | % | | 8.8 | | % | 110 bps | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Trailing Twelve Months Ended September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2026 | | | | 2025 | | | Δ ($) | | | | | | | | | | | | (In thousands) | | | | | | | | | | | | TTM EBITDA and TTM Adjusted EBITDA | | | | | | | | | | | | | | | | TTM net income | | $ | 26,162 | | | $ | 6,078 | | | $ | 20,084 | | | | | | | | | | | Interest expense | | | 244 | | | | 559 | | | | (315 | ) | | | | | | | | | | Interest income | | | (1,692 | ) | | | (1,140 | ) | | | (552 | ) | | | | | | | | | | Provision for income taxes | | | 5,410 | | | | 2,616 | | | | 2,794 | | | | | | | | | | | Depreciation and amortization | | | 10,722 | | | | 10,537 | | | | 185 | | | | | | | | | | | TTM EBITDA | | | 40,846 | | | | 18,650 | | | | 22,196 | | | | | | | | | | | Adjustments: | | | | | | | | | | | | | | | | Other (income) expense, net | | | (7,081 | ) | | | (426 | ) | | | (6,655 | ) | | | | | | | | | | Restricted stock compensation expense | | | 11,903 | | | | 10,387 | | | | 1,516 | | | | | | | | | | | Loss on debt extinguishment | | | 9 | | | | 418 | | | | (409 | ) | | | | | | | | | | TTM Adjusted EBITDA | | $ | 45,677 | | | $ | 29,029 | | | $ | 16,648 | | | | | | | | | | | TTM Adjusted EBITDA/TTM Net sales % | | | 7.3 | | % | | 5.1 | | % | 220 bps | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | | | | | Nine Months Ended September 30, | | | | | | | 2026 | | | | 2025 | | | Δ ($) | | | | | 2026 | | | | 2025 | | | Δ ($) | | | | (In thousands, except per share data) | | | | | | (In thousands, except per share data) | | | | Adjusted net income | | | | | | | | | | | | | | | | Net income | | $ | 29,899 | | | $ | 19,892 | | | $ | 10,007 | | | | | $ | 31,482 | | | $ | 15,191 | | | $ | 16,291 | | | Restricted stock compensation expense | | | 3,043 | | | | 2,392 | | | | 651 | | | | | | 9,122 | | | | 8,132 | | | | 990 | | | Loss on debt extinguishment | | | - | | | | 1 | | | | (1 | ) | | | | | - | | | | 418 | | | | (418 | ) | | Refunded tariff expenditure | | | (29 | ) | | | - | | | | (29 | ) | | | | | (6,801 | ) | | | - | | | | (6,801 | ) | | Tax impact of additional charges | | | (619 | ) | | | (1,733 | ) | | | 1,114 | | | | | | (477 | ) | | | (3,153 | ) | | | 2,676 | | | Adjusted net income | | $ | 32,294 | | | $ | 20,552 | | | $ | 11,742 | | | | | $ | 33,326 | | | $ | 20,588 | | | $ | 12,738 | | | Adjusted earnings per share - basic | | $ | 2.82 | | | $ | 1.84 | | | $ | 0.98 | | | | | $ | 2.91 | | | $ | 1.84 | | | $ | 1.07 | | | Shares used in adjusted earnings per share - basic | | 11,450 | | | | 11,185 | | | | 265 | | | | | | 11,446 | | | | 11,159 | | | | 287 | | | Adjusted earnings per share - diluted | | $ | 2.68 | | | $ | 1.80 | | | $ | 0.88 | | | | | $ | 2.81 | | | $ | 1.79 | | | $ | 1.02 | | | Shares used in adjusted earnings per share - diluted | | 12,051 | | | | 11,423 | | | | 628 | | | | | | 11,869 | | | | 11,487 | | | | 382 | | | | | | | | | | | | | | | | | | | JAKKS Pacific, Inc. and Subsidiaries | Net Sales by Division and Geographic Region | | | | | | | | | | | | | | | | | | | | | | | | | | | (In thousands) | QTD Q3 | | (In thousands) | YTD Q3 | Divisions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | | Divisions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | Toys/Consumer Products | $264,306 | $156,080 | $191,957 | 23.0 | % | -14.8 | % | | Toys/Consumer Products | $451,786 | $343,897 | $389,559 | 13.3 | % | -7.1 | % | Dolls, Role-Play/Dress-Up | | 146,893 | | 92,330 | | 119,151 | 29.0 | % | -9.9 | % | | Dolls, Role-Play/Dress-Up | | 251,075 | | 193,957 | | 208,277 | 7.4 | % | -8.9 | % | Action Play & Collectibles | | 98,750 | | 52,950 | | 63,092 | 19.2 | % | -20.1 | % | | Action Play & Collectibles | | 168,313 | | 125,733 | | 160,424 | 27.6 | % | -2.4 | % | Outdoor/Seasonal Toys | | 18,663 | | 10,800 | | 9,714 | -10.1 | % | -27.9 | % | | Outdoor/Seasonal Toys | | 32,398 | | 24,207 | | 20,858 | -13.8 | % | -19.8 | % | Costumes | $57,300 | $55,130 | $62,265 | 12.9 | % | 4.2 | % | | Costumes | $108,515 | $99,660 | $110,577 | 11.0 | % | 0.9 | % | Total | $321,606 | $211,210 | $254,222 | 20.4 | % | -11.1 | % | | Total | $560,301 | $443,557 | $500,136 | 12.8 | % | -5.5 | % | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (In thousands) | QTD Q3 | | (In thousands) | YTD Q3 | Regions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | | Regions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | United States | $255,278 | $154,516 | $202,837 | 31.3 | % | -10.9 | % | | United States | $451,545 | $330,450 | $385,724 | 16.7 | % | -7.6 | % | Europe | | 30,034 | | 29,408 | | 29,686 | 0.9 | % | -0.6 | % | | Europe | | 46,033 | | 55,875 | | 63,086 | 12.9 | % | 17.1 | % | Latin America | | 22,632 | | 14,066 | | 10,771 | -23.4 | % | -31.0 | % | | Latin America | | 33,867 | | 27,572 | | 21,870 | -20.7 | % | -19.6 | % | Canada | | 7,068 | | 9,237 | | 5,960 | -35.5 | % | -8.2 | % | | Canada | | 16,726 | | 21,342 | | 16,032 | -24.9 | % | -2.1 | % | Asia | | 2,345 | | 1,526 | | 2,745 | 79.9 | % | 8.2 | % | | Asia | | 4,578 | | 3,725 | | 6,896 | 85.1 | % | 22.7 | % | Australia & New Zealand | | 3,339 | | 2,095 | | 1,616 | -22.9 | % | -30.4 | % | | Australia & New Zealand | | 6,292 | | 3,594 | | 5,618 | 56.3 | % | -5.5 | % | Middle East & Africa | | 910 | | 362 | | 607 | 67.7 | % | -18.3 | % | | Middle East & Africa | | 1,260 | | 999 | | 910 | -8.9 | % | -15.0 | % | Total | $321,606 | $211,210 | $254,222 | 20.4 | % | -11.1 | % | | Total | $560,301 | $443,557 | $500,136 | 12.8 | % | -5.5 | % | | | | | | | | | | | | | | | | | | | | | | | | | | | (In thousands) | QTD Q3 | | (In thousands) | YTD Q3 | Regions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | | Regions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | North America | $262,346 | $163,753 | $208,797 | 27.5 | % | -10.8 | % | | North America | $468,271 | $351,792 | $401,756 | 14.2 | % | -7.4 | % | International | | 59,260 | | 47,457 | | 45,425 | -4.3 | % | -12.4 | % | | International | | 92,030 | | 91,765 | | 98,380 | 7.2 | % | 3.4 | % | Total | $321,606 | $211,210 | $254,222 | 20.4 | % | -11.1 | % | | Total | $560,301 | $443,557 | $500,136 | 12.8 | % | -5.5 | % | | | | | | | | | | | | | | | | | | | | | | | | | | | (In thousands) | QTD Q3 | | (In thousands) | YTD Q3 | Regions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | | Regions | | 2024 | | 2025 | | 2026 | % Change 2025 v 2026 | CAGR% 2024 - 2026 | United States | $255,278 | $154,516 | $202,837 | 31.3 | % | -10.9 | % | | United States | $451,545 | $330,450 | $385,724 | 16.7 | % | -7.6 | % | Rest of World | | 66,328 | | 56,694 | | 51,385 | -9.4 | % | -12.0 | % | | Rest of World | | 108,756 | | 113,107 | | 114,412 | 1.2 | % | 2.6 | % | Total | $321,606 | $211,210 | $254,222 | 20.4 | % | -11.1 | % | | Total | $560,301 | $443,557 | $500,136 | 12.8 | % | -5.5 | % | | | | | | | | | | | | | |

- Interested in JAKKS Pacific, Inc.? Here are five stocks we like better. - JAKKS Pacific's third-quarter sales rose 20% to $254 million, led by 28% North American growth, Disney-related products and Nintendo merchandise, while international sales fell 4% for the quarter. - Gross margin remained largely stable at 32.1% despite elevated resin and freight costs, while adjusted EBITDA increased to $44.4 million and adjusted EPS rose to $2.68 from $1.80 a year earlier. - Management highlighted strong demand for licensed products and costumes, introduced its Doll Haus of Dread collector line, and sees further expansion opportunities in 2027 through new entertainment releases, international distribution and anime-related initiatives. - 3 Solid Consumer Brands Offering Stability in Volatile Markets JAKKS Pacific (NASDAQ:JAKK) reported third-quarter net sales of $254 million for the period ended Sept. 30, 2026, up 20% from the prior-year quarter, as growth in North America, Disney-related products and Nintendo merchandise offset a softer international quarter. Chairman and Chief Executive Officer Stephen Berman said year-to-date sales increased 13%, while the company's freight-on-board, or FOB, business model represented more than 75% of sales during the first nine months of the year. He said buying patterns were returning to pre-tariff quarterly seasonality, though the company continues to manage higher product and freight costs. → Aurora Rejects Curaleaf's Higher Bid, But the Takeover Fight Isn't Over - 3 2021 Winners to Ride Out the Year With North American sales rose 28% in the third quarter and were up 14% year to date, according to Berman. International sales declined 4% during the quarter following what he described as a strong first half, although international sales remained 7% higher year to date. Europe was marginally higher, while other international regions declined, he said. The company's dolls, role play and dress-up business grew 29% in the quarter and 7% year to date. Berman attributed the growth in part to Disney products, adding that point-of-sale trends at JAKKS' two largest retail accounts continued to rise by double digits in the category. → Could Quantinuum's Breakthrough Make Its Sell-Off a Bargain? - JAKKS Pacific Stock is Recovering Action play and collectibles revenue increased 19% in the quarter, supported by the Super Mario Galaxy film and the company's Nintendo evergreen business. Comparable point-of-sale data was roughly flat for the quarter against prior-year comparisons that included Sonic the Hedgehog 3 and a DC x Sonic crossover initiative, Berman said. Comparable point-of-sale data was up mid-single digits year to date. Overall, toy and consumer-products shipping rose 23% in the third quarter and 13% year to date. The company's costume business generated $62 million in quarterly sales and $111 million year to date, placing it slightly ahead of 2024 levels, Berman said. He noted that most U.S. costume accounts posted double-digit growth and that JAKKS has been expanding its European account base and year-round dress-up business. → IonQ's Bold Expansion Could Leave Shareholders Paying the Price Chief Financial Officer John Kimble said third-quarter gross margin was 32.1%, compared with 32.0% a year earlier. Higher sales translated into a 20% increase in gross-margin dollars, he said, though the company continued to face pressure from product and freight costs. Berman cited higher resin prices affecting product costs and higher diesel prices affecting ocean and land freight. He said JAKKS is prioritizing shipments, scrutinizing inventory and working with long-standing manufacturing partners in Asia to mitigate the effects of those costs. Kimble said selling expenses increased as the company expanded promotional activity compared with last year, when it had reduced spending amid lower sales volumes. General and administrative costs were higher in aggregate but benefited from some scale on higher volume, he said. - Adjusted EBITDA was $44.4 million, compared with $36.5 million in the prior-year quarter. - Trailing 12-month adjusted EBITDA was $45.7 million, up from $37.8 million in the prior quarter. - Adjusted earnings per share were $2.68, compared with $1.80 a year earlier. - Year-to-date adjusted EPS was $2.81, versus $1.79 in the prior-year period. - Cash, including restricted and unrestricted cash, totaled $45 million at quarter-end, compared with $28 million a year earlier. - Inventory was $64 million, down from $71 million a year earlier. The board approved a quarterly cash dividend of $0.25 per share, payable Dec. 28 to shareholders of record as of Nov. 27. Berman said demand has been strong for costumes tied to Netflix's KPop Demon Hunters, as well as Disney's Descendants 5, Pixar's Toy Story 5, Super Mario, Sonic the Hedgehog and Harry Potter. Warner Bros. is promoting a Harry Potter HBO series scheduled to launch in December, alongside the 25th anniversary of the first Harry Potter theatrical release, he said. Disney Princess and Disney Frozen products have exceeded the company's expectations in 2026, Berman said. JAKKS also highlighted initial sales of its Disney Princess Magical Light & Style Rapunzel doll and continued expansion of Walmart private-label offerings through the My Sweet Love and My Life As brands. The company also introduced its Doll Haus of Dread collector-doll line, featuring dolls inspired by Ghostface from Scream, Billy the Puppet from Saw, Jason from the Jason Universe franchise and Pinhead from Hellraiser. Berman said the line launched exclusively at Walmart and Walmart.com and sold through inventory following a live video sale at Walmart's collector booth during New York Comic Con. Management said it is preparing for a stronger entertainment slate in 2027, including Sonic the Hedgehog 4 in March, a Simpsons movie in September and Frozen 3 in November. Berman said the company did not have a major new entertainment release in the toy business for the 2026 holiday season, but said the lack of a major release reflected timing rather than a more selective licensing strategy. JAKKS is also pursuing a long-term initiative centered on anime, manga, VTubers and digital entertainers. Berman said retail meetings in the U.S., Europe and Latin America ahead of the initial launch generated enthusiastic feedback. During the question-and-answer session, Berman said the company is expanding distribution in Europe, Latin America and Southeast Asia, including through additional staffing, warehouses and distribution centers. He said the company expects deeper penetration in secondary and value channels to support growth in 2027 and 2028. Kimble said international margins are generally comparable with those in the U.S. JAKKS Pacific, Inc is a toy and consumer products company that develops, manufactures and markets toys, games and related products for children and families. Its portfolio includes action figures, dolls, vehicles, playsets, role-play and dress-up products, plush toys, preschool items, games, and seasonal and outdoor products. The company sells products under its own brands and through licensing and entertainment partnerships. Its offerings have included products based on well-known movie, television, video game and character properties, as well as proprietary brands such as Maui and Airwalk. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "What JAKKS Pacific (JAKK) Said on Its Q3 Earnings Call" was originally published by MarketBeat. View MarketBeat's top stocks for October 2026.

Hasbro (HAS) came out with quarterly earnings of $2.9 per share, beating the Zacks Consensus Estimate of $1.86 per share. This compares to earnings of $1.68 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +55.91%. A quarter ago, it was expected that this toy maker would post earnings of $1.17 per share when it actually produced earnings of $1.28, delivering a surprise of +9.4%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Hasbro, which belongs to the Zacks Toys - Games - Hobbies industry, posted revenues of $1.6 billion for the quarter ended September 2026, surpassing the Zacks Consensus Estimate by 8.63%. This compares to year-ago revenues of $1.39 billion. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Hasbro shares have added about 20.1% since the beginning of the year versus the S&P 500's gain of 12.4%. While Hasbro has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Hasbro was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.54 on $1.46 billion in revenues for the coming quarter and $6.14 on $5.04 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Toys - Games - Hobbies is currently in the bottom 20% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Jakks Pacific (JAKK), has yet to report results for the quarter ended September 2026. The results are expected to be released on October 22. This toymaker is expected to post quarterly earnings of $2.54 per share in its upcoming report, which represents a year-over-year change of +41.1%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Jakks Pacific's revenues are expected to be $244.12 million, up 15.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Hasbro, Inc. (HAS) : Free Stock Analysis Report JAKKS Pacific, Inc. (JAKK) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was driven by the Action Play and Collectibles division, specifically supporting the Super Mario Bros. film with movie-branded product sales exceeding the first film's volume. The Dolls, Role Play, and Dress Up business grew 12% despite a lack of new entertainment support, bolstered by a 18-month expansion of the Frozen product line. Management attributed improved velocity to the unwinding of tariff-related price shocks, allowing retail prices for lower-priced items to return toward pre-tariff levels. International growth reached record first-half levels, driven by a strategy of curating region-specific product portfolios and expanding distributor networks in fragmented markets. The outdoor seasonal business remains a structural headwind as retailers reallocate shelf space away from bulky items that are poorly suited for low-cost home delivery economics. Operational efficiency was maintained through a high-FOB business model, which reached its highest level this decade at over 75% of shipments. Strategic focus remains on the 'true toy' kids market (ages 0-7) even as competitors pivot toward 'kidults', though the company is selectively entering the anime and digital entertainer space. The 2026 outlook assumes a front-weighted year due to the lack of major new toy introductions supporting holiday theatrical releases in the second half. Management is reengineering packaging and product design for the outdoor segment to shrink box sizes and improve delivery economics over a multi-year timeline. A major 2027 growth catalyst is expected from top-tier theatrical releases for Sonic the Hedgehog (Q1) and Disney Frozen (Q4). The company is preparing a methodical launch into anime, manga, and VTube digital entertainer segments for 2027, targeting both specialty and mass-market channels. Strategic investments include opening a first office in South America and adding senior sales professionals to drive long-term international diversification. The company successfully recovered essentially all applied-for tariff refunds following a Supreme Court ruling, resulting in a $6.8 million non-operating gain. Management utilized the refund process to revalue on-hand inventory, removing excess carrying costs generated by previous tariffs to reduce balance sheet values. The Board approved its sixth consecutive quarterly cash dividend of $0.25 per share, reflecting a commitment to capital return alongside growth investments. A slight operating loss in Q2 was characterized as an improvement over the prior year, with management prioritizing margin dollars over margin percentages. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management noted the market has adapted to previous price shocks; JAKKS specifically reduced costs in various products to hit sub-$30 retail price points where volume is highest. The company has diversified its retail footprint, deepening relationships with value and specialty trades like TJ Maxx and 5 Below alongside traditional mass-market accounts. The majority of international sales are on an FOB basis, which enhances internal margins while allowing international customers to offer lower prices to consumers. Management sees a 2-3 year window of rapid growth through country-specific licensing and distribution strategies. Management confirmed that no revenue is expected from anime-related efforts in 2026. The strategy involves a 'grassroots' launch with specialty retailers first, followed by wide distribution in fall 2027. With a strong cash position, management is actively speaking with bankers regarding potential acquisitions that would benefit shareholders. The focus for M&A remains on segments that shore up the core toy business or provide entry into high-growth categories like anime.

This article first appeared on GuruFocus. Net Sales: $139.2 million in Q2, a 17% increase year-over-year. Year-to-Date Sales: $245.9 million, 6% ahead of the prior year. North America Sales Growth: 20% increase in Q2, 3% for the first half. International Sales Growth: 3% increase in Q2, 20% for the first half. Toys and Consumer Products Growth: 5% increase in the first half. Dolls, Role-Play and Dress-Up Growth: 12% increase in Q2. Disguised Business Growth: 8% increase in Q2, 9% for the first half. Outdoor Seasonal Business: 12% decrease in Q2, 17% decrease year-to-date. Gross Margin: 32.3% in Q2, slightly lower than 32.8% last year. Operating Loss: $142,000 in Q2, improved from a $2.8 million loss last year. Adjusted EBITDA: $5.4 million in Q2, up from $2.3 million last year. Adjusted EPS: $0.25 in Q2, $0.09 for the first half. Cash Position: $60.6 million in cash at the end of Q2, up from $43.1 million last year. Inventory Level: $58.3 million at the end of Q2, down from $71.8 million last year. Quarterly Dividend: $0.25 per share, payable on September 28. Warning! GuruFocus has detected 7 Warning Signs with JAKK. Is JAKK fairly valued? Test your thesis with our free DCF calculator. Release Date: July 23, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Jakks Pacific Inc (NASDAQ:JAKK) reported a 17% increase in net sales for Q2, reaching $139.2 million, with North America leading the growth. The company's international business saw a 20% increase in sales for the first half of the year, marking the highest level of international first-half shipping in over a decade. The Toys and Consumer products division grew by 5%, driven by the success of the Super Mario Brothers film merchandise. The Dolls, Role-Play, and Dress-Up business increased by 12% in Q2, with strong performance from the Frozen product line. Adjusted EBITDA for the quarter was $5.4 million, up from $2.3 million in Q2 of the previous year, indicating improved financial performance. The outdoor seasonal business experienced a decline, with sales down 12% in the quarter and 17% year-to-date, due to structural headwinds in retail space allocation. Gross margins slightly decreased to 32.3% from 32.8% in the previous year, despite tight management of costs. The company reported a slight operating loss of $142,000 in the quarter, although this was an improvement from a $2.8 million loss in the same quarter last year. The company does not anticipate any more tariff refunds going forward, which had previously contributed to non-operating income. No revenue from anime-related efforts is expected for 2026, indicating a delay in realizing potential growth from this segment. Q: How has the domestic market changed post-tariff adjustments, and what opportunities does this present for JAKKS Pacific? A: Stephen Berman, CEO, explained that the market has adapted to price changes due to tariffs and costs. JAKKS has reduced costs to bring price points back to levels that drive volume, particularly under $30 retail. The company has diversified its distribution across major retailers and value trades, seeing strong point-of-sale results compared to last spring. Q: What is the outlook for international markets and their impact on margins? A: Stephen Berman noted that international markets, particularly in EMEA, Latin America, and Southeast Asia, are growing well. JAKKS has adapted its product lines to be more suitable for these markets and maintains a strong FOB structure, enhancing margins and offering competitive pricing to consumers. Q: How is JAKKS Pacific planning to utilize its increasing cash reserves, particularly regarding new licenses and potential M&A? A: Stephen Berman stated that JAKKS has a strong balance sheet, allowing for exploration of new licenses and potential acquisitions. The company is focused on diversifying its license portfolio and remains open to acquisition opportunities that align with its core focus on toy and kids' consumer products. Q: Was there any benefit to gross margins from the tariff refunds received? A: John Kimble, CFO, confirmed that there was no benefit to gross margins from the tariff refunds in the quarter. Q: Is the pace of anime-related efforts progressing as expected, and what is the revenue outlook for 2026? A: Stephen Berman confirmed that anime-related initiatives are on track, with a grassroots marketing approach and wide distribution planned for fall 2027. There is no expected revenue from these efforts in 2026. Q: How is the current media landscape affecting JAKKS Pacific, particularly with changes at major studios like Pixar and Warner Bros.? A: Stephen Berman stated that there are no challenges from the media landscape changes. JAKKS sees opportunities due to its focus on kids' products and diversification into kidult areas, maintaining strong relationships with licensors and entertainment holders. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Image source: The Motley Fool. Thursday, July 23, 2026 at 5:00 p.m. ET Chairman and Chief Executive Officer - Steven Berman Chief Financial Officer - John L. Kimble Operator: Good afternoon, everyone. Welcome to the JAKKS Pacific Second Quarter Earnings Conference Call with Management who will review financial results for the quarter ended 06/30/2026. JAKKS issued its earnings press release earlier today. Earnings release and presentation slides related to today's call are available on the company's Web in the Investors section. On the call this afternoon are Steven Berman, chairman and chief executive officer, and John L. Kimble, chief financial officer. Steven will first provide an overview of the quarter and year to date along with highlights of recent performance and current business trends. Then John will provide some additional comments around JAKKS' specific financial and operational results. Mr. Berman will then return with comments about the balance of the year and beyond prior to opening up the call for questions. The line will be placed on mute for the first portion of the call. If you like to be placed in the queue to ask a question, please press 11 on your telephone keypad. Before we begin, the company would like to point out that any comments made about JAKKS Pacific future performance events or circumstances, including the estimate of sales, margins, earnings, and or adjusted EBITDA in 2026 and beyond, as well as any other forward looking statements concerning 2026 and beyond are subject to safe harbor protection under federal security laws. These statements reflect the company's best judgment based on current market trends and conditions today and are subject to certain risks and uncertainties which could cause actual results to differ materially from those projected in forward looking statements. For details concerning these and other such risks and uncertainties, you should consult JAKKS' most recent 10 k and 10 q filings with the SEC as well as the company's others report subsequently filed with the SEC from time to time. In addition, today's comments by management will refer to non GAAP financial measures such as adjusted EBITDA, and adjusted earnings per share. Unless stated otherwise, the most directly comparable GAAP financial metrics have been reconciled to the associated non GAAP financial measure within the company's earnings press release issued today or previously. As a reminder, this call is being recorded. With that, I would like to turn the call over to Steven Berman. Stephen G. Berman: Good afternoon, and thank you for joining us today. Our Q2 financial results were modestly better than our expectations and an improvement over the same quarter a year ago. Globally, our net sales finished at $139.2 million in Q2 a 17% increase compared to prior year when the sudden implementation of massive tariffs dramatically reduced customer orders. Year to date, our sales are 6% ahead of prior year at $245.9 million, our best first half since 2023. North America led the improved results, growing 20% year over year in Q2 and 3% for the first half. Our international business reflected smaller year over year growth of 3% led by Europe but is up 20% for the first half of the year. Overall, this is the highest level of international first half shipping in JAKKS' history, over 10 years, at $53 million. Keeping the focus on the first half, our toys and consumer product business was up 5%. Those results were driven by the action play and collectibles division, which was up as we supported the extremely successful second Super Mario Brothers film released in April. Led by an array of 5-inch figures developed specifically for the film, Our product line also featured playsets, dioramas, and plush and was very well received with solid sell throughs. Building on that, we have another wave of new product introductions shipping now for fall planogram sets and promotional spaces. Some of which are already on shelf. As retailers knew we had a solid opportunity with this film Through the first 3 quarters of shipping, we have sold in more movie branded products than what we did for the first film. Which is great, especially given the consumer reaction. Fans can also look forward to a lot more focus on Donkey Kong in the second half with a feature playset shipping along with a new figure multipack. Our dolls, role play, and dress up business was up 12% in Q2 despite a lack of new entertainment support compared to the prior year. Of note, we have been steadily expanding our frozen product line over the past 18 months. Offering new role play patterns refreshing key products. Although Frozen has been a cornerstone of our business dating back to the original film release, the business is up for the first half of this year versus prior year. In the fall, we have a strong retailer exclusive placed that will add more energy to this aisle as we build towards the frozen 3 theatrical event in fall of 2027. Retail pricing of our Disney princess and style collection assortments were heavily impacted by tariffs most of last year. And those price shocks have unwound over recent months We see some customers bringing retail prices down closer to where they were pre tariff, although, admittedly, not across the entire product line. In general, it is true for the lower price points. We feel lower retails are contributing to improved velocity as consumers discover some of the strong innovative items we launched last fall as well as this spring. We are also seeing expanded listings resulting in positive point of sale results. The baby bath doll line launched in fall continues to sell extremely well, and our refreshed 6-inch princess doll line with a sub-$10 price point has been a strong performer as well. Retail toy and consumer products POS at the top 2 US accounts was positive in the first half, accelerating to double digit levels in Q2. Our Disguise business also performed well up 8% in the quarter, and 9% in the first half. The popularity of Toy Story 5, and the Super Mario Brothers films are positive contributors to our business this year, well as our launch of K pop Demon Hunters costumes. Our outdoor seasonal business includes everything from activity tables and chairs to ball pits to ride ons, to skateboards and hula hoops among other products remained a slight drag on results this quarter. We see this as a structural headwind rather than a transitory 1. Retailers continue to reallocate in store space away from large box items these bulky formats are poorly suited to the low cost home delivery model that increasingly shaping retail economics. We are not waiting this out. We are managing this business with a multiyear lens and a clear plan on 2 levers. Partnering with retailers to defend and recapture shelf space and lost sales, and reengineering packaging and product design to shrink box sizes and improve delivery economics. We are already advancing on both fronts. While these investments will take time to fully show up in the numbers, we are extremely confident they position this business for sustainable, profitable growth as the category continues to shift. We like where we are headed, but for the quarter, we were down 12% and down 17% year-to-date to $11.1 million in sales. Gross margins held up very well in the quarter at 32.3%, slightly lower than last year's at 32.8%. Tight management of sales, marketing, overhead costs led to a slight operating loss of $142 thousand in the quarter compared to a $2.8 million loss in Q2 of last year. Adjusted EBITDA in the quarter was $5.4 million compared to $2.3 million in Q2 last year. That increases our 12 month trailing adjusted EBITDA to $37.8 million. I will now pass it over to John for some comments after which I will come back and discuss some product initiatives and areas of focus moving forward. John. John L. Kimble: Thank you, Steven, and hello, everybody. This has been a solid quarter wrapping up a solid first half of the year. Steven has pointed out, everything has been going pretty much in line with our expectations. it is a plus when that actually happens. Our FOB centric business model is alive and well, Our first half shipments were over 75% FOB, reaching as high of a level as we have seen this decade. From a seasonality point of view, we have planned this year as a bit more front-weighted than normal given the strength of Super Mario. Since we do not have any new toy introductions in the second half supporting holiday theatrical releases. And so far, that outlook is holding up. As I look at our financial results, I am focused on seeing gross margin dollars increase 3% in the first half to a little over $80 million. that is a pretty good outcome and reflects solid execution against what we saw as the opportunity. A bit better than the last 2 years and a couple of million dollars short of where we were in 2023. Ultimately, as a company, I wanna see us optimizing for margin dollars and not margin percentages. As we do the extra work to identify incremental business outside of the traditional US mass market, I believe that is going to require more financial creativity in how we assess new opportunities. Which is something we are in progress on working through. But establishing more annuity like evergreen revenue streams while continuing to thoughtfully manage overhead should create another flow of long term bottom line profitability, which I feel we are only starting to wrap our heads around. As the majority of our overhead costs are fixed, I think we have an opportunity in this area given our momentum over the past couple of years. But it will admittedly take some time to build and prove out. To that end, we managed a bit of leverage in both selling and G and A in the first half, offsetting gross margin percentage being down slightly. That led to a slight operating loss in the quarter, and a $5.7 million operating loss in the first half improved over the $6.5 million loss last year. In the same time period. Working our way down the P&L, that leads us to the topic of IEPA tariff refunds. As mentioned last quarter, we applied for refunds for tariffs we paid under the regulations which the Supreme Court ultimately struck down. We are pleased to share that we have had essentially all of those funds refunded to us as of the second quarter close. We do not anticipate any more refunds going forward. In the quarter, we took the opportunity to revalue on hand inventory that was still burdened by those tariffs to essentially undo the excess carrying costs that the tariffs generated upon import. Thereby reducing the value on the balance sheet. The remainder of funds received we have recognized on the P&L this quarter as non operating other income of $6.8 million These refunds have raised our projection for pretax net income for the year so our Q2 tax estimate has been adjusted accordingly. We have opted to back this gain out of our published non GAAP projections of adjusted EBITDA and adjusted earnings per share. With that said, adjusted EPS for the quarter was $0.25 and $0.09 for the first half of the year. That compares favorably to $0.03 of earnings in Q2 last year and being breakeven year to date EPS at the same time last year. From a balance sheet perspective, we finished the quarter at $60.6 million in restricted and unrestricted cash compared to $43.1 million at the same time last year. That increase is largely driven by stronger operating results and the aforementioned tariff refund. As of July 17, the comparable cash on hand number was $47.1 million to give you an extra bit of context to remind you of the seasonality in our working capital. Our inventory level at the end of the quarter was $58.3 million, down from $71.8 million at the this time last year, and up a bit from $52.9 million last quarter. Finally, the Board has approved our sixth consecutive quarterly cash dividend of $0.25 per share. The dividend will be payable to shareholders of record as of August 28, and will be payable on September 28. And now back to Steven for some more discussion of what is ahead. Stephen G. Berman: Thank you, John. Midyear is always an exciting time in the business as we get close to all the energy, and excitement around Halloween, and the fourth quarter holiday season. While also seeing the full lineup for the following year. Solidifying and receiving positive feedback from customers around the world. And as much as we have mentioned before, I cannot emphasize enough the traction we are getting elevating our level of focus and performance outside of The US. We are increasingly working with key existing accounts in Europe on exclusive launches while listening to our customer needs and curating new offerings to open new accounts on the strength of our broad brand portfolios. We are additionally working with more distributors to specifically reach additional accounts in more fragmented markets. Our evergreen brands and categories with global appeal create a platform where products designed toward lower price points can reach a very wide audience when we could form the right partnership between our vendors in Asia, the licensors, and the right distribution partner to reach smaller accounts around the world. We have recently added 3 senior sales professionals to our global organization to further drive our business to higher levels. In addition to opening our first office in South America, an eye towards longer term growth there. Turning back to the near term, I want to highlight some of the exciting areas as we move into the second half of the year. Our Disney Darling line continues to expand both in The US and in Europe with broader listings, which are in great sell throughs success so far this year. The snuggly stars Wishables segment has recently launched in The US in store and online and selected accounts with rapid sell throughs. You will see a much broader Disney Darlings assortment on shelf later this year supported by 360 marketing campaign across regions. Our baby dolls continue to be the happiest baby dolls you will find in the marketplace, There is no crying at JAKKS and there is no crying in the Disney Darling line of products. In Disney Princess, our ages and stages strategy is introducing new core large dolls and matching dresses. Our 2 featured items will be grow and style Rapunzel doll and our interactive dance with me bell. The bell doll will be featured out of aisle at key US accounts as our must have princess toy this holiday season. With Disney Ily, we are introducing a new range with lower price points to further expand the product portfolio. We are also investing with a focus on the serious Disney fan who has proven to be the most enthusiastic Illy consumer. We see an opportunity by increasing our reach to more of them, especially given the current breadth and depth of this line. Moving to our Sonic business. This fall, we are launching Giant Metal Sonic. The biggest most sophisticated feature large scale action figure we have ever released as part of our Sonic the Hedgehog product line. Inspired by the Metal Sonic from the Sonic Superstars video game, At over 20 inches tall, it recreates ultimate boss battle Metal Sonic faces off with a 2.5-inch sonic figure, which is also included. With the menacing light up eyes, sounds, and slashing arm action, it comes in the 30 fifth anniversary packaging and we believe will top many holiday wish lists. These large scale toys have always been well received by the Sonic fan base, and we secured strong retail support and placement this fall. Also this fall inspired by the DC-Sonic crossover series, we have more new product arriving for the fall that we plan to announce soon. As I mentioned, fans should look forward to the new Super Mario inspired film product follow with a mix of core items and strong retail exclusives. They will also see our continued support and innovation within our evergreen Nintendo business, including a number of items themed to Super Mario Wonder game. This past quarter, we also launched as a retail exclusive a new collector doll line of DC Comics characters. Featuring Poison Ivy, Catwoman, and fan favorite Harley Quinn. We saw a nice presale engagement, and these dolls continue to sell through well. In the fall, we will be mixing in a range of other classic Warner Bros. characters that fans love and have not been able to get in these product executions. In our Disguise costume business, beyond the properties already mentioned, our product line this year features other new entertainment releases. Including Disney's Descendants 5, PAW Patrol: The Dino Movie, and Minions and Monsters, just to name a few. We remain on track to deliver a strong year of results in 2026, both financially and achieving potentially exceeding our initial plans. But more importantly, making substantial progress in building this business for growth in 2027, 2028, and beyond. In 2027, we have 2 top tier theatrical releases from Sonic the Hedgehog and Disney Frozen franchises lined up for Q1 and Q4, respectively. But beyond that, there are a number of additional initiatives, some entertainment led, some working with our key customers on private label opportunities, and some opportunities just classic new toy lines with innovation driven by creativity of our design and marketing teams. In addition, we and the trade are extremely excited to launch our anime, manga, and VTube digital entertainer initiatives for 2027 and beyond. We are opening up brand new distribution channels while working differently with our well established current distribution partners to bring a lot of different offerings to the market, that we will discuss in more detail later in the year and throughout 2027. And now we will take a couple questions. Operator? Operator: Thank you. At this time, we will conduct a question and answer session. To wait for your name to be announced. To withdraw your question, please press 11 again. Please stand by. We will compile the q and a roster. And our first question comes from the line of Eric Beder of Small Cap Consumer Research. Your line is now open. Eric Beder: Great. Congratulations. Stephen G. Berman: Thank you, Eric. Eric Beder: Let me ask a question about the domestic market here. So we went through this shock. We are coming back out of it. How do you see the market change And I guess, what are the opportunities from that you can take advantage of? Stephen G. Berman: Well, firstly, thank you very much. The things that we have seen versus last year is that the market adapted to the price changes that occurred throughout the industry with prices being raised where appropriate due to tariffs and also the volatility of the cost of petroleum with regards to resins as well as container costs. So I believe, at least for us, we have mandated and have achieved what we needed to going into this year. Which is reducing costs in various products to achieve bringing back the price points to the correct price points. That we see more volume in. Those are the price points during usually the spring and summer under $30 retail. We have done that, adapted to it very quickly. In addition, we have dove very deep in with the value trade and the specialty trades. it is as the TJ Maxx's, the Ross's, and so on. Long as our strong major customers like Target, Walmart, and Amazon you know, going into the 5 Below's, the Dollar Trade, and so on. So we became very diversified through this. Both on a FOB basis and slightly on a domestic basis. So we are also seeing the appetite at retail that the POS is quite strong during the spring versus last spring. So the appetite's there for the right product at the right price points. Eric Beder: Okay. So, basically, you can-- you can-- you have kind of matched with you kinda taken your advantage and kept prices where you would need to be and still maintain kind of the margins that we are seeing right now. Stephen G. Berman: Yes. And plus. Yes. Okay. Eric Beder: Now you mentioned about the change in international is a great opportunity. Some of these markets are not as concentrated as we are in The US. What does that mean for kind of the level of FOB you see internationally? And the potential for margins going forward on that? Stephen G. Berman: Well, the great thing about international is it is growing on a great path. In EMEA, Latin America, South America, and Southeast Asia. So we are growing with 1, our product categories and lines are really more appropriate today than they were 5 years ago for the international market. that is 1. 2, we have the majority of the licensing rights that work in the territories. We have the right ones that are correct for our company. That being said, there is certain properties that work well in UK, Germany, and France that do not work well in Italy or Spain. So we really are very quick to market with the right product at the right country at the right level. The same goes for Latin America, South America, and Southeast Asia. In addition, we have the FOB structure that we started since inception is very much a footprint internationally. So primarily, the majority of our sales internationally are on an FOB basis, which helps us then enhance our own margins internally giving a also a lower price to the customer which they could enhance their margin as a customer and also then have a lower price for the consumer, which gives them a great price point to have. So all of those combinations on top of great product, great licenses, and strong momentum in all of our different categories. it is allowing us to grow pretty rapidly and going forward for the next 2, 3 years. We see strong growth, diversification, various countries and just some really strong initiatives that we see going forward. Eric Beder: Okay and final question. What are you seeing in terms of, potentially either for new licenses, m and a, You keep on getting more cash. How should we be thinking about that kind of potential, I guess, near and longer term? Thank you. Stephen G. Berman: Thanks for that question. 1 thing is, we are a strong, healthy balance sheet, which gives us a lot of strength going forward and looking at different opportunities. But the first part of the question, we have a lot of licenses in which we have not been able to announce yet because some of them are under contract. But our licensed portfolio is diversifying very strongly in each of our categories of business, the 5 different segments that we focus on. We are focused. We are a toy company. We are a kids consumer product company. So while a lot of companies are focused on the kidult, which we are heavily focused on in the anime segmentation that we are moving into, and we are into that in certain other areas. We are truly a toy kids consumer product company, and we do not forget about kids. At the young age that will never change from that age group from birth to 6-7 years old. So that is the key focus that a lot of companies are moving out of, and that is a key focus that we are diving deeper in with the understanding of kidults is a great market, and we have been in it. Since we did double digits ago. And you know, Nintendo and Sonic and The Simpsons. there is kidults involved, but the anime segment manga, VTubers, and digital entertainers are truly kidults and above. So we are in all the areas of business. I do think it is it is interesting when I hear people focusing on more in the kidult area and not the true toy business where we are focused on. We are focused on that acquiring licenses, If there is an opportunity in the acquisition area, in the segment that would benefit the company and our shareholders, We have been looking. We are speaking to bankers and so on and so if an opportunity arose, we have the cash and the availability with banking To be able to get additional capital if needed. So that is on our platform. And going into this year, we are looking at going into the 2027 and 2028, which we feel very strong and confident about. We will be sitting with the board of directors looking at different capital allocation initiatives But, going through the first half of the year, having a strong performance, and then looking at what happened in last year back and so on and so forth. We are just really focused on shoring up our business taking market share, and then looking to grow in the future. Eric Beder: Great. Good luck for the rest of the year. Stephen G. Berman: Thank you. Thank you. Operator: 1 moment for our next question. Our next question comes from the line of Thomas Forte of Maxim Group. Your line is now open. Thomas Forte: Yep. Steven, John, congrats on great quarter. I have 3 questions. Stephen G. Berman: Thank you, Tom. Thomas Forte: I apologize. They are kind of on the boring side. So they are points of clarification. John L. Kimble: So the first point of clarification John, can you just clarify that there was no benefit to your gross margin in the quarter from the tariff refunds. Correct. Thomas Forte: Thank you. Second, Steven, the pace of your anime related efforts is it the same as you expected last quarter? Stephen G. Berman: Yes. Yes. We are extremely focused and extremely aggressively putting the initiatives together in these various segments that I brought up anime, the manga, the VTube, and enter digital entertainers. And the way that we are launching this is a really grassroots marketing with the specific retailers that are focused in this genre at first, and then a wide distribution initiative in the fall of 2027 with major of the main retailers that we know that we work with today on top of the actual anime call it Asian pop culture, distribution retail channels. Thomas Forte: And then the same thing goes for international in France and Latin America. there is very strong initiatives in anime. Stephen G. Berman: So we are very much on path, very strong with it. And very excited about it, but it is a very methodical initiative and launch. And long term expectations are still as strong as we were before. Thomas Forte: Great. So, Steven, so just a quick follow-up there. So there is nothing expected for 2026 revenue. From anime related efforts. Stephen G. Berman: Correct. Okay. Thomas Forte: And then lastly, the media landscape even by the media landscape standards, seems to be a little more cloudy. Pixar had layoffs even though Toy Story 5 is on pace for a billion. You know, the Paramount Warner Brothers deal seems to be in a holding pattern. Is this creating any additional opportunities or presenting any additional challenges for you? Stephen G. Berman: Not challenges. I mean, all in all, in the business environment, you see what the Walt Disney's company doing with Pixar and so on and so forth. Those are just common business practices that you go into and look for, you know, efficiencies and so on. The Paramount Warner Brothers deal it is still business as normal with all the, call it, the license and entertainment holders. Nothing's changed in the direction of where we are at as a company. We see a lot of opportunity right now just because of the traction that we have in the various segments that we are in. And as I mentioned, a few minutes ago, as we are focused in the kids' area of business, a lot of companies are focused on kidult, we see a huge opportunity in growth in our normal segments. Addition to the kidult areas that we talked about. Our cosplaying, our disguise division, our Halloween division. I just see things very strong moving forward. And really looking forward to this year and going into 2027. We are very comfortable with the initiatives we are undertaking, our private label initiative that we have done with some major retailers is picking up very strongly. So we just diversified our company in a very healthy platform going forward. Thomas Forte: You, Steven. Thank you, John. Stephen G. Berman: Thank you. Thanks, Tom. Operator: Thank you. This concludes the question and answer session. I would now like to turn it back to Steven Berman, CEO, for final remarks. Stephen G. Berman: Ladies and gentlemen, thank you for your time today, and we look forward to speaking to investors after these calls today and tomorrow and looking forward to our third quarter conference call. Getting on the road. Thank you, everybody. Operator: Thank you for participation in today's conference. This concludes the program. You may now disconnect. Before you buy stock in JAKKS Pacific, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and JAKKS Pacific wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. 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