Q3 2025 Funko Inc Earnings Call

Speaker #1: Good afternoon and welcome to Funko S 2025 . Third Quarter Financial Results . Conference call . At this time , all participants are in listen only mode .

Speaker #1: Later , we will conduct a question and answer session . If you would like to ask a question , please raise your hand if you have dialed in to today's call , please press star nine to raise your hand .

Speaker #1: Star six to unmute . Please be advised that reproduction of this call , in whole or in part , is not permitted without written authorization from the company .

Speaker #1: As a reminder , this call is being recorded . I will now hand the conference over to Funko's Director of Investor Relations , Robert Jaffe .

Speaker #1: Please proceed .

Speaker #2: Hello everyone , and thank you for joining us today to discuss Funko's 2025 third quarter financial results . On the call are Josh Simon , our recently appointed Chief Executive Officer , and Yves , the company's chief financial officer .

Speaker #2: This call is being broadcast live at investor Funko Inc , a playback will be available for at least one year on the company's website .

Speaker #2: I want to remind everyone that during the course of this call , management's discussion will include forward looking information . These statements represent our best judgment as of today about the company's future results and performance .

Speaker #2: Our actual results are subject to many risks and uncertainties that may differ materially from those stated or implied , including those discussed in our earnings release .

Speaker #2: Additional information concerning factors that could cause actual results to differ materially is contained in our , most recently filed SEC reports . In addition , during this call , we refer to non-GAAP Financial measures that are not prepared in accordance with us generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies .

Speaker #2: Investors are encouraged to review Funko's press release announcing its 2025 third quarter financial results for the company's reasons for presenting non-GAAP financial measures .

Speaker #2: A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures is also attached to the company's earnings press release issued earlier today .

Speaker #2: Also , we have posted supplemental financial information on the Investor Relations section of the company's website , which includes , among other things , a net sales bridge , a gross margin bridge and key IP and product drivers .

Speaker #2: I will now turn the call over to Josh Simon . Josh .

Speaker #3: Thanks , Rob . Good afternoon , everyone , and thank you for joining us . This is my first earnings conference call at Funko .

Speaker #3: And I want to start by saying I couldn't be more thrilled to be joining the team at this exciting time . Over the course of my career , I've seen this industry from a variety of perspectives making movies at Disney , creating products at Nike , and most recently leading the global consumer products and live experiences division at Netflix .

Speaker #3: Now , across all those worlds , I gained a strong understanding for fandom . The culture of entertainment and how it translates into physical products .

Speaker #3: And I can unequivocally say there is no one better at it than Funko . There's one clear trend I saw across my years in entertainment and consumer products .

Speaker #3: Almost every filmmaker , creator , or celebrity with whom I've worked inevitably asked if they would get their own Funko Pop ! It's seen as a sign of having made it in the entertainment world .

Speaker #3: Among the biggest Hollywood talent from the outside , that love for Funko and its brand and products was energizing . Now , I want to begin with some takeaways from my first 60 days after diving deep into the business and speaking with our customers .

Speaker #3: Licensors and employees . Then I'll outline some of what I think it will take to get back to growth . I have the opportunity to meet with some of our most passionate fans at our retail stores and at New York Comic-Con .

Speaker #3: I've been able to spend time with our employees in the US and Europe , and we've engaged in senior leadership strategy sessions with key retailers like Hot Topic , Walmart and Target .

Speaker #3: Licensors like Disney , Warner Bros . Universal and Netflix . And I have a deep , long standing set of relationships with most of these partners .

Speaker #3: And welcomed an honest dialogue . In talking with our partners , I heard two consistent themes . First , and most importantly , they see the growth opportunity together and are energized by the far reaching scope of our brand and products .

Speaker #3: And second, they suggested some very clear areas where we can improve. We definitely appreciate and value their feedback and will use it to further strengthen our competitive advantages.

Speaker #3: Namely , first , we have a passionate and broad fan base in September at a fan event at our Hollywood store , I was able to celebrate an important milestone for the company .

Speaker #3: 1 billion units sold . This amazing achievement puts us in very rare company . Among the most successful toy brands in the world .

Speaker #3: Membership in our fan loyalty program has grown 27% since the start of the year . We have a strong footprint of 9 million followers across our social media channels , and our customer base is highly diversified and evenly split between male and female , with purchasers across an 18 to 55 year old demographic .

Speaker #3: Many of whom are buying for kids . Second , we work with the world's biggest IP and serve fans across every corner of the pop culture universe .

Speaker #3: Our robust relationships across multiple genres , more than 900 active licensed properties and 250 plus content providers create a strong moat around this industry leading portfolio of licenses .

Speaker #3: Our product offering is highly diversified. We're not reliant on one character or single franchise. Now, I'm pleased to announce that we've recently signed several multi-year renewal agreements with major licensing partners, Warner Bros.

Speaker #3: NBC universal , 20th century , Paramount , and our biggest partner , the Walt Disney Company , which includes Pixar , Marvel and Lucasfilm .

Speaker #3: Third , our products are sold everywhere . Fan shop through a large and diversified global network of retailers , including more than 1400 mass market specialty e-commerce and mom and pop partners around the world , as well as our own websites and flagship stores .

Speaker #3: There are very few brands that are equally relevant across mass retailers like Walmart and that can spark a robust resale market on eBay.

Speaker #3: At the same time . I'm still early into my tenure here , but my leadership team and I have identified our areas of focus and are ready to act immediately .

Speaker #3: Our growth will be driven by what we're calling our make culture pop strategy , built at the intersection of three pillars , creativity , and commerce .

Speaker #3: This is where Funko has excelled and will align our priorities and organization to maximize the opportunity . In these three focus areas . Let's start with culture .

Speaker #3: We aim to be the definitive brand for transforming pop culture into products . That includes fandoms that are existing strengths like film and TV , along with exploring new corners of pop culture through categories like footwear , cosmetics and food .

Speaker #3: We can do more in the areas of K-pop , sports , music , tours and fashion , and working with relevant content creators to expand into newer areas of fandoms like Twitch streamers , YouTubers , and influencers .

Speaker #3: We want our products to be at the center of the moment . Everyone is talking about . Created by us or with us .

Speaker #3: Now , some examples of what that means . We will look to identify trends even faster and supercharge our speed to market . Let me give you a quick culture example of what I mean through the lens of K-pop demon hunters .

Speaker #3: Netflix's most popular movie ever . Our team was among the first to recognize the appeal of this property for both mass audiences and collectors .

Speaker #3: We moved quickly to create an exciting lineup of products that has become one of our biggest presale items ever. When it launched a month ago, the Funko team was able to bring this product offering to market within just a couple of months.

Speaker #3: Across pop figures , backpacks and accessories . Compared with much longer lead times by other major toy companies , this speed to market is one of our unique advantages and will be one of the only toy companies that have K-pop demon Hunters products on retail shelves .

Speaker #3: This holiday season . We're operationalizing our Quick Strike and Hyper Strike offense across our entire value chain to make this more repeatable by operating at a faster pace and being more on trend .

Speaker #3: We also aim to position our products at the center of what everyone is talking about , across all corners of pop culture . For example , we partnered with the Late Show with Stephen Colbert for a surprise on air product reveal timed to the show's 10th anniversary in September .

Speaker #3: The episode featured Stephen Colbert unveiling a brand new Funko Pop ! And marked a major crossover moment between late night television and fandom culture .

Speaker #3: The launch included a live studio audience giveaway , creating a shared moment of celebration between Colbert , his millions of at home viewers , and Funko collectors around the world .

Speaker #3: In music, we added to our Funko Pops music artist collection with Fame, a Latin American sensation with nearly 30 million fans across Instagram and TikTok, in just a few weeks.

Speaker #3: Our partnership has driven more than 5.7 million views on social media and is representative of our efforts to work with more artists who are in the global zeitgeist and create touchpoints for our growing customer base outside of the US .

Speaker #3: In addition to fade , we've recently added a number of other artists to our Funko Pops music artists collection , including the K-pop band BTS , the Swedish rock band ghost , Sabrina Carpenter , and classic artists like Tom petty , Metallica and Ozzy Osbourne .

Speaker #3: Now , an important part of cultural relevance also comes from embracing our community of passionate collectors around the world . Just as I saw at Nike supporting the collectors market through exclusive drops and giving them something special is critical to building fan communities and driving brand awareness and excitement .

Speaker #3: It's a major priority for us to rebuild credibility and enthusiasm with collectors and mega fans who have been loyal to us for years .

Speaker #3: By improving execution around limited editions , storytelling and drop cadence in the third quarter , we dropped a number of limited edition collectible pop figures with various tiers of rarity dunharrow from the Lord of the rings , Starkiller from Star Wars , Sonic Spyder , Cat , Bob's Big Boy , and Phantasm .

Speaker #3: Each of these , one of a kind , pops sold out within one hour for the community of sports fans . We expanded our relationship with Inter Miami of Major League Soccer at the start of this MLS season .

Speaker #3: We have dedicated retail space at the team's new state of the art home stadium , where fans will be able to purchase on site a yourself with Inter Miami's official logo , standard Funko Pop !

Speaker #3: Figures of the team's most famous players and exclusive products only available at the store , or take the growing global fandom of anime .

Speaker #3: We have even more opportunity to grow this business, which represented 30% of our sales in Q3 and is now our second largest.

Speaker #3: Fan vertical . The US market for pop anime remains very strong , and we've only scratched the surface with expansions in Europe , Asia , and Latin America .

Speaker #3: Now let's talk about creativity . The goal is to continue innovating new form factors , expanding our product , offering , and obsessing over the details across design , development , and storytelling .

Speaker #3: So our products feel meaningful for fans . We built a beloved and truly unique franchise with pop , and we're working on adding additional dimensions for fans .

Speaker #3: More excitement , and bringing compelling new products to market . One example already showing traction is Pop . Our mini vinyl figures . Biddy pop is integral to our evolving strategic partnership with Walmart last month .

Speaker #3: Was officially introduced in their toy aisle . It made Walmart's 2025 top toy list and was featured Walmart's Toy Book catalog , which went out to over 40 million homes in the US just in time for the upcoming holiday season .

Speaker #3: On top of that , an Out of IO placement of BD pop is expected to land in 1800 . Walmart stores later this month .

Speaker #3: We have built out the BD pop line to include the in worldbuild . We intend to further expand the line to include more licensed and original characters and environments that allow fans to create realistic worlds or use their imagination to create new ones .

Speaker #3: As the blind box format continues to grow in popularity around the world, we're planning to expand our existing blind box offering, Mystery Minis.

Speaker #3: These collectible figures , which have been on the market for the last 12 years , are smaller than our pop vinyl and larger than our BD pop figures .

Speaker #3: We see additional growth potential in the blind box space across new IPs, genres, and fandoms spanning film series and social media, as well as our own original characters.

Speaker #3: Earlier this week , we initiated a limited launch with several of our specialty retail partners for our new premium blind box collection . An artist driven product line that gives fans the opportunity to discover bold and imaginative new designs , beginning with two entries in this category .

Speaker #3: We intend to expand ability to new IP over the course of 2026 . Our premium blind box line includes a Chase variant , and we're looking to add more offerings for both internal and external artists .

Speaker #3: Now , it's also important to note we have a diverse product archive of formats . Going back 25 years . Many of which I think can be leveraged in more relevant ways to capture the hearts of today's fans and collectors .

Speaker #3: Now , let's talk about commerce . We see a significant expand the internationally , particularly in Asia and Latin America , and enhance our presence with existing retail partners and deepen our digital and direct to consumer opportunity to .

Speaker #3: To start , there's a significant opportunity to grow our international business with a more dedicated focus in Asia and Latin America . This was an area of particular focus for me at Netflix , and there's a clear lane for Funko to excel in .

Speaker #3: These important geographies with our DTC business , we intend to simplify the experience on our e-commerce site and app . This includes a more intuitive design , improved functionality around limited edition drops , wish lists , and loyalty programs .

Speaker #3: Pop yourself , which just launched in Europe , is a great example of the unique experience only we can offer , and we're planning to add a new AI powered builder later this year , which allows the user to upload a picture and recommends options to more quickly build a customized pop , which we think will be transformative .

Speaker #3: We're also planning new , innovative retail experiences such as selling beauty , pop products through vending machines with a surprise or mystery element to the purchase experience .

Speaker #3: In addition to the pop yourself kiosk at Inter Miami's new stadium beginning early next year , we plan to add more pop yourself kiosks to support other year round retail experiences and pop up activations , both in the US and in Europe .

Speaker #3: We also plan to refresh existing kiosks flagship stores with enhanced capabilities , including the AI powered builder . Now to summarize , our main culture pop strategy is focused on maximizing opportunities at the intersection of culture .

Speaker #3: Being at the center of the moments , everyone is talking about across more fandoms , creativity through new products and form factors , and in our commerce .

Speaker #3: By being more strategic with partners in the US and Europe , Latin America and Asia in direct to consumer . Now , to be clear , we already have many ongoing initiatives against this plan underway .

Speaker #3: We're building the right team and capabilities to attack these opportunities in a focused manner and drive growth . Now , that said , I'm only 60 days in and we have a lot more to come .

Speaker #3: I'm excited and confident about our team and the opportunity working with our partners to ignite growth and to sell the next 1 billion pop products .

Speaker #3: And with that , I'll turn it over to Eve to review our Q3 results .

Speaker #4: Thanks , Josh . Hey everyone . Thanks for joining us today for the third quarter . Total net sales were $250.9 million , in line with our expectations compared with Q3 of last year .

Speaker #4: Approximately $11 million of the decrease in net sales can be attributed to skew rationalizations , as well as a reduction of clearance sales .

Speaker #4: As a reminder , we posted supplemental financial information on our website , which includes a net sales as well as a gross margin bridge direct to consumer sales mix .

Speaker #4: In the quarter was 18% of our gross sales , down from 20% in last year's Q3 , due in part to a pullback in marketing spend .

Speaker #4: Gross profit was $100.8 million , equal to gross margin of 40.2% , which was better than expected . Price increases helped fully offset the impact of increased tariffs .

Speaker #4: It's worth noting that with the exception of our 2025 second quarter , which was significantly impacted by tariffs , we have maintained a gross margin in the 40% plus range since the first quarter of 2020 .

Speaker #4: Four , where in six of the last seven quarters , as expenses were $79.8 million , compared to $92.7 million last year . Approximately half of the reduction came from a full quarter benefit of cost reduction actions taken in Q2 , and the other half came from a reduction in marketing spend .

Speaker #4: Adjusted net income was $3.2 million , or $0.06 per diluted share . And finally , adjusted EBITDA was $24.4 million , which was higher than our expectations .

Speaker #4: Turning to our balance sheet at September 30th , we had cash and cash equivalents of $39.2 million . Net inventory was $99.8 million , and our total debt was approximately $241 million .

Speaker #4: Turning now to our outlook . We're pleased with our Q3 results and the progress made against the second half outlook , which we shared last quarter .

Speaker #4: We now expect, for the 2025 fourth quarter, net sales to increase modestly from Q3 2025, driven in part by the launch of Pop Yourself in Europe and sales of our Kpop Demon Hunters product lines.

Speaker #4: Gross margin of approximately 40% and adjusted EBITDA margin to be in the mid to high single digits range . A few comments on our refinancing process .

Speaker #4: Our 10-q filing for the 2025 third quarter includes disclosures about the company's ability to continue as a going concern . As previously announced , we executed an amendment to our existing credit facilities , which mature in September of 2026 .

Speaker #4: The amendment waived financial covenants for Q2 and Q3 and introduced a minimum cash requirement and a series of milestones to demonstrate progress against a refinancing transaction .

Speaker #4: We've engaged Melissa and company , LLC to advise the company on our refinancing process , and that process is ongoing . With that , I'll turn it back over to Josh .

Speaker #3: Thanks , Eve . Compared with where we were two years ago , we've made progress on improving the quality of our business . Our gross margin trend has largely improved .

Speaker #3: We have a stronger retail footprint . We've fully implemented a price increase and inventory owned . And in the channel is lower . And at healthier levels .

Speaker #3: Now , I want to reiterate the sense of urgency and opportunity around our make culture pop strategy , executing across the intersection of culture , creativity , and commerce .

Speaker #3: In the short term , I'm looking to maintain the momentum we've discussed over the long term . What's most exciting to me , and I hope is equally exciting to our investors , are the multiple opportunities to transform the company for substantial growth .

Speaker #3: We have a strategic advantage from building this company over the last 27 years , and we intend to leverage that legacy and relationship with our community of fans to take advantage of the huge opportunity in the increasingly global world of entertainment and pop culture fandom .

Speaker #3: I'm incredibly excited about joining Funko for my perspective , the company has lots of potential on which we've already begun acting , and with that , we'll open the call for questions .

Speaker #3: Operator .

Speaker #1: We will now begin the question and answer session . If you would like to ask a question , please use the raise hand function .

Speaker #1: Now . If you have dialed in to today's call , please press star nine to raise your hand and star six to unmute .

Speaker #1: Please stand by while we compile the Q&A roster . Our first question comes from the line of Stephen Lasik with Goldman Sachs . Your line is open .

Speaker #1: Please go ahead .

Speaker #5: Hey guys , thanks for taking the question . Josh , welcome . Thank you for all those thoughtful highlights on the strategy . I'm curious as you look out ahead again , some of those opportunities that you outlined , how you're thinking about what opportunities exist over the next 12 months to execute against how investors should be thinking about what your prioritizing , the sizing of some of those opportunities , perhaps what what points of the strategy you feel like you need to get correct here over the next year or so before it unlocks the option value over the longer term to take Funko to the next level , so to speak .

Speaker #5: Anything that top priorities that come to mind , I think would be helpful for us to understand and then have a follow up .

Speaker #5: Thank you .

Speaker #3: Great , great . Thanks , Steven . Appreciate the question . I mean , look , I'd say in the short term our focus is on continuing , you know , the performance momentum that that we've been talking about .

Speaker #3: And then over the long term , obviously transforming for more growth . I do really think it comes down to and I'll give you some specifics around the make culture pop strategy .

Speaker #3: You know , in the short term of the area of culture , I think there's really some areas of fandom where we can continue to expand .

Speaker #3: Obviously , you know , as you know , we've been doing a lot in the areas of sports and music . But , you know , we just , you know , there's opportunities to move quicker in those areas .

Speaker #3: And so , you know , as an example , we just recently were able to launch the Dodgers championship five pack . There's some really great details to it .

Speaker #3: Even includes them . You know sort of wearing their alternate road alternate road uniforms . So really like how we think about operationalizing quick strike end to end capabilities , sensing trends , designing and manufacturing more quickly and getting it to consumers in new ways is really important .

Speaker #3: Part of , you know , of the cultural impact that we're looking to drive . And obviously we can share more details about that in the future .

Speaker #3: On the creativity side . I mean , we're we're really focusing on how we bring more dimensions to our core franchise , which is pop .

Speaker #3: BD is a really great example of that . Obviously , we mentioned , you know , how it's rolling out into Walmart . Now .

Speaker #3: I'm spending a lot of time engaging more broadly with the creative community , bringing people internally to help think about new , new sort of evolutions of products that we can launch .

Speaker #3: Leveraging my relationships across the entertainment industry and the product space . Thinking about how we can more closely collaborate with talent . Those are all sort of immediate things that we can do to continue to evolve our our form factors and creative product strategy .

Speaker #3: And then on the commerce side , I mean , I've , you know , been able to engage with some really great strategic meetings with some of our biggest retailers over the last couple of months .

Speaker #3: You know , international is a huge component of that . And so I think , you know , particularly based on pre-existing relationships I have there , you know , we'll look to , you know , come back next quarter and talk in a little bit more specifics about some goals that we're immediately looking to get after with retail partners in Asia and Latin America .

Speaker #3: And look, I should also note on the, you know, because I think this is an important point to highlight on the commerce side as well.

Speaker #3: You know, we were able to execute some really great extensions of our licensing deals with all the biggest studios, you know, in the last few months.

Speaker #3: And so I think that puts us on really firm footing to kind of . Take everything that we talked about as part of our make culture pop strategy .

Speaker #3: And , drive growth through those relationships , as well .

Speaker #5: That's great . Thanks . That's really helpful . And then if I could just ask a question , maybe more in the near term on the quarter and the broader retail environment , maybe for both Josh and ease on for Q just as you have with retailers heading into this holiday season , anything you'd conversations point out in terms of .

Speaker #5: The cadence of stocking , how they're approaching restocking this year , how they're particularly engaging with Funko as a brand , as a partner this holiday season , that that differs from perhaps what you've seen in historic years or or perhaps where the levers are , as we get deeper into holiday , on where we're stocking could come from upside down side in the model , etc.

Speaker #5: .

Speaker #4: Hey Steven , this is Eve . I'll start by saying , you know , I think we're kind of encouraged by , you know , our POS trend , which has remained relatively strong and stable in Q3 .

Speaker #4: Our global kind of POS in units was was down only 3% year over year . Now we are continuing to see a pretty big difference in our various territories that we operate in .

Speaker #4: U.S. was more like down mid to high single digits in units, and then EMEA was up in low double digits. So we continue to see the consumer demand for our products.

Speaker #4: That being said , you know , obviously the tariff announcements earlier this year pretty significantly disrupted in Q2 , the kind of shipping of our orders out of Asia .

Speaker #4: And in Q3 , I'd say we kind of continue to have a bit of a hangover effect from that . And what you have to keep in mind is that retailers were placing their buys for Q3 and early Q4 shipments during , you know , what I'd call kind of peak uncertainty about what the tariff rates are going to be , how the consumer is going to hold up through the holiday period , and that was , you know , that was in part why our sell in was was down over last year in Q3 .

Speaker #4: I would say , as , as we head into the holiday period , it's a bit of a mix depending on the channel and the retailer .

Speaker #4: But I would say that we continue to have good momentum in Europe and the US a little bit more cautiousness . I think , from buyers , we do see a little bit more strength and momentum in the mass channel .

Speaker #4: And Josh mentioned the the growth in BD pop sales . There . So we're encouraged by that . It feels like for the smaller kind of specialty , mom and pops distributors , you know , I'm maybe a little bit of speculation here but feels like might be more kind of financially impacted by the tariffs or just generally more cautious about overcommitting to to inventory .

Speaker #3: Yeah . And what I would continue with is , you know , the , the content slate is pretty big for us in Q4 .

Speaker #3: The final season of Stranger Things will launch . And that's a big priority for some of our biggest retail partners , as well as us .

Speaker #3: Obviously , the sequel or the part two of wicked will also be in the market . And , you know , we have , you know , products there .

Speaker #3: And then , you know , I think most importantly , just as a reminder , we really will have a lot of unique shelf space through our K-pop Demon Hunters assortment across both Funko and Loungefly .

Speaker #3: So I think , you know , some good , you know , sort of content slate strength and shared priorities with our retail partners on that front .

Speaker #5: Very helpful . Thank you both .

Speaker #4: Thanks , Steven .

Speaker #1: Next question comes from the line of Keegan Cox with D.A. Davidson . Your line is open . Please go ahead .

Speaker #6: Hi , guys . I just wanted to ask a little bit as you , you know , open up this creativity and commerce .

Speaker #6: I know you talked a little bit about the vending machines and kiosks . I was just wondering , how do you look at that market ?

Speaker #6: It seems pretty competitive . I've seen a few of your competitors moving in there , just in like my mall visits and retail visits .

Speaker #6: So just to how you see that market and how you plan to attack it .

Speaker #6: curious

Speaker #3: Yeah . Well , look , I think for us , the primary driver and excitement is around the pop yourself experience , which you know , is pretty unique to us .

Speaker #3: The ability for , you know , a fan to go and create customized Funko Pop of themselves or a friend as a gift is something that I think we are uniquely able to offer .

Speaker #3: And so when we talk about the kiosk strategy , you know , we have examples of those kiosks that currently exist in a couple of locations , primarily in

Speaker #3: our flagship stores , but we've already been deep into conversations with some some of our bigger retail partners about how we can start to create experiences within their real estate footprint and bring that experience to more of our fans around the around the country and around the world .

Speaker #3: So I think we offer pretty unique angle there .

Speaker #6: Got it . And then as I was just looking at the results , Europe sales down slightly versus , you know , an easier comparison .

Speaker #6: Last year . I know you're launching pop yourself in the fourth quarter , but what are you seeing outside of that in Europe ?

Speaker #4: Well , like I mentioned previously , you know , our POS trend is pretty strong in Europe . You know , I would say one of the factors , you know , that's not super material , but we did have a little bit of production delays that impacted our European sales in the quarter .

Speaker #4: Just some orders that just couldn't make it out of the factory in time . As a reminder , we moved pretty aggressively to move production from China to Vietnam .

Speaker #4: And so , you know , that was a bit of a result of that . But we expect those orders to ship in Q4 .

Speaker #4: And then along along with the launch of Pop Yourself in Europe , which happened a few weeks ago , we expect Europe to be back to back to growth in the fourth quarter .

Speaker #6: Got it . And one more if I can , just on pricing , I know you were able to essentially offset all of the tariff costs , but are you seeing that impact demand ?

Speaker #6: I mean , the POS for the US this weak . So I'm wondering how pricing played into that .

Speaker #4: Well , we've actually been pleasantly surprised by that . We rolled out the price increases they were in effect on the shelf in in early July .

Speaker #4: I mean , we did anticipate that there would be slightly lower unit volumes . You know , it's hard to attribute that directly to the price increase and not to to the other kind of factors going on in the US market .

Speaker #4: But generally , it's been in line with our expectations . I mentioned the POS trend . So the the unit sales have held up pretty well .

Speaker #4: And then , you know , the price increases are fully in effect . So it's gone pretty well for us .

Speaker #6: Thank you .

Speaker #4: Thanks , Keegan .

Speaker #1: There are no further questions at this time . I will now turn the call back to management for closing remarks .

Speaker #3: Thanks , everyone for joining us on the call today . We look forward to sharing our progress on our next call .