JAKKS Pacific Reports 20% Revenue Decline and Net Loss in Q2 2025

JAKKS Pacific, Inc. reported its financial results for the second quarter ended June 30, 2025, revealing a decline in both revenue and profitability compared to the same period last year. The company generated net sales of $119.1 million, a decrease of 20% from $148.6 million in the second quarter of 2024. For the first half of 2025, total revenue was $232.3 million, down from $238.7 million in the prior year. The company recorded a net loss of $2.3 million for the quarter, compared to a net income of $5.3 million in the same quarter of 2024, resulting in a loss per share of $0.21.

The decline in sales was attributed to several factors, including reduced demand in North America due to higher importation costs, which negatively impacted the Toys/Consumer Products segment. This segment saw a 23.1% decrease in sales, while the Costumes segment also experienced a 12% decline. Despite these challenges, international sales showed some resilience, with a 41.1% increase in net sales outside North America. The company’s gross profit for the quarter was $39 million, down from $47.6 million a year earlier, reflecting a gross margin of 32.8%.

In terms of operational developments, JAKKS Pacific made significant changes to its credit facilities. The company terminated its previous $67.5 million revolving credit facility with JPMorgan Chase and entered into a new $70 million senior secured revolving credit facility with BMO Bank N.A. on June 24, 2025. This new facility is expected to enhance liquidity and provide better pricing terms. As of June 30, 2025, the company had no outstanding borrowings under the new facility, with total borrowing availability at $70 million.

The company’s inventory levels increased to $71.8 million as of June 30, 2025, compared to $52.8 million at the end of 2024, indicating a strategic decision to bolster stock in anticipation of future demand. JAKKS Pacific also reported a decrease in accounts receivable, which stood at $124.5 million, down from $131.6 million at the end of 2024. The company’s total assets decreased to $438.7 million from $444.9 million at the end of the previous fiscal year, while total liabilities also saw a slight reduction.

Looking ahead, JAKKS Pacific remains cautious about its outlook, given the current market conditions and the impact of rising import costs on consumer demand. The company plans to continue monitoring its operational performance closely and adapt its strategies to navigate the challenges in the toy industry. The management expressed optimism about potential growth in international markets and the introduction of new product lines, which may help offset declines in domestic sales.