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1. Company Snapshot

1.a. Company Description

JAKKS Pacific, Inc.develops, produces, markets, sells, and distributes toys, consumables, and electronics and related products worldwide.It operates in two segments, Toys/Consumer Products and Costumes.


The company offers action figures and accessories, such as licensed characters; toy vehicles and accessories; dolls and accessories, including small, large, fashion, and baby dolls based on licenses, as well as infant and pre-school products; private label products; and foot-to-floor ride-on products, inflatable environments, tents, and wagons.The company also provides role play, dress-up, pretend play, and novelty products for boys and girls based on brands and entertainment properties, as well as on its own proprietary brands; and indoor and outdoor kids' furniture, activity trays and tables, room décor, kiddie pools, and seasonal and outdoor products.In addition, it offers Halloween and everyday costumes for various ages based on licensed and proprietary non-licensed brands, and related Halloween accessories; outdoor activity toys; and junior sports toys, including hyper-charged balls, sport sets, and toy hoops.


The company sells its products through in-house sales staff and independent sales representatives to toy and mass-market retail chain stores, department stores, office supply stores, drug and grocery store chains, club stores, value-oriented dollar stores, toy specialty stores, and wholesalers.JAKKS Pacific, Inc.was incorporated in 1995 and is headquartered in Santa Monica, California.

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1.b. Last Insights on JAKK

JAKKS Pacific's recent performance has been influenced by a mixed set of factors. The company's Q3 2025 earnings call revealed a focus on higher-margin products and cost-cutting, which is improving profitability. However, the company missed Q3 earnings and revenue estimates, with quarterly earnings of $1.8 per share, down from $4.79 per share a year ago. A strong net cash position and valuable IP portfolio provide a foundation for potential growth. Recent product launches, including Super Mario and The Wizard of Oz lines, may drive future sales. (Source: Zacks Consensus Estimate)

1.c. Company Highlights

2. JAKKS Pacific's Q3 2025 Earnings: Navigating Tariffs and Retail Uncertainty

JAKKS Pacific reported a challenging Q3 2025, with net sales down 21% year-to-date, driven by a 24% decline in Toys/Consumer Products and an 8% drop in Costumes. The company's Q3 sales were $211.2 million, with Toys and Consumer Products sales down 41% to $156.1 million and Costumes down 4% to $55.1 million. Gross margin was 32%, down from 33.8% last year, and adjusted EBITDA was $36.5 million, down from $74.4 million. EPS came in at $1.8, below estimates of $2.6. The company's trailing 12-month EBITDA was $29 million.

Publication Date: Dec -02

📋 Highlights
  • Sales Decline:: Q3 Toys/Consumer Products sales dropped 41% to $156.1M; year-to-date net sales down 21% YoY.
  • Margin Pressure:: Gross margin fell to 32% in Q3 from 33.8% YoY; adjusted EBITDA declined to $36.5M vs. $74.4M in 2024.
  • Inventory Growth:: Worldwide inventory rose to $72M (up from $64M YoY) due to international expansion, with international business flat YoY (-0.3%).
  • Strategic Shifts:: 93% of sales drop attributed to FOB shipments; focus on IP licensing (e.g., Disney's Darling doll) and 2026 product pipeline with positive retailer feedback.
  • Tariff Impact:: Q3 saw material sell-through decline from tariffs; company plans conservative 2026-2027 strategies with higher sales prices but lower unit volumes.

Operational Challenges and Strategic Focus

The company's worldwide inventory was $72 million at the end of Q3, up from $64 million last year, driven by international expansion. JAKKS is taking a conservative approach, prioritizing margins, pricing discipline, and cost controls amidst significant tariff changes and retailer uncertainty. CFO John Kimble noted that 93% of the year-over-year drop in sales came from FOB shipments.

Outlook and Opportunities

The company is cautiously planning for the holiday season, citing a wide range of possible outcomes, and is focused on navigating current challenges while preparing for 2026 and beyond. JAKKS is working with licensors to recalibrate royalty rates and has a robust product pipeline, including collaborations with Disney and Nintendo. The company is also exploring strategic M&A opportunities.

Valuation and Dividend Yield

With a P/E Ratio of 30.22 and an EV/EBITDA of 10.78, the company's valuation multiples suggest a cautious market outlook. However, the Dividend Yield of 6.09% provides a relatively attractive return for investors. Analysts estimate next year's revenue growth at 6.5%, which may help the company navigate the current challenges.

New Business Initiatives

JAKKS is building out its new business pillar as a licensor and intellectual property owner, with discussions underway to secure necessary rights. The goal is to leverage existing strengths and extend its product line into other hardline and softline areas, with a broader line expected to launch in spring 2027.

3. NewsRoom

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The Bottom Fishing Club - JAKKS Pacific: Hit By Tariffs, Ready For Rebound

Nov -24

Source: seekingalpha.com

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Disguise Celebrates Three Consecutive Years as the #1 Costume Manufacturer YTD in the U.S., with Minecraft securing their Top License Spot, According to Circana

Nov -18

Source: globenewswire.com

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Disguise and Aniplex Announce Expanded Licensing Agreement for Demon Slayer: Kimetsu no Yaiba Costumes and Accessories

Nov -10

Source: globenewswire.com

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JAKKS Pacific, Inc. (JAKK) Q3 2025 Earnings Call Transcript

Oct -30

Source: seekingalpha.com

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Jakks Pacific (JAKK) Misses Q3 Earnings and Revenue Estimates

Oct -30

Source: zacks.com

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JAKKS Pacific: Pain Is Temporary, Progress Will Continue

Oct -18

Source: seekingalpha.com

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JAKKS Pacific, Inc. Announces Third Quarter 2025 Earnings Call

Oct -09

Source: globenewswire.com

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Follow the Yellow Brick Road: JAKKS Pacific Debuts Adorable The Wizard of Oz Product Line

Oct -08

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.32%)

6. Segments

Toys/Consumer Products

Expected Growth: 5.5%

Growing demand for licensed toys, increasing popularity of nostalgic brands, and expansion into emerging markets drive growth for JAKKS Pacific, Inc. The company's diverse portfolio of popular licenses, such as Disney and Nintendo, positions it for continued success.

Costumes

Expected Growth: 4.5%

Growing demand for experiential entertainment, increasing popularity of cosplay and themed events, and expanding licensed character portfolios drive the costume market growth.

7. Detailed Products

Action Figures and Accessories

JAKKS Pacific designs and manufactures a wide range of action figures and accessories, including characters from popular franchises like WWE, Nintendo, and more.

Dolls and Accessories

JAKKS Pacific offers a variety of dolls and accessories, including fashion dolls, playsets, and furniture, inspired by popular franchises like Disney Princess and more.

Pretend Play and Dress-up

JAKKS Pacific's pretend play and dress-up products include costumes, playsets, and accessories inspired by popular franchises like Disney, Marvel, and more.

Ride-Ons and Scooters

JAKKS Pacific designs and manufactures a range of ride-on toys and scooters, including licensed products from popular franchises like Disney and Pixar.

Art and Craft Supplies

JAKKS Pacific offers a variety of art and craft supplies, including paints, markers, and activity sets, inspired by popular franchises like Disney and more.

Seasonal and Outdoor Toys

JAKKS Pacific designs and manufactures a range of seasonal and outdoor toys, including water guns, bubbles, and more.

8. JAKKS Pacific, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

JAKKS Pacific, Inc. faces moderate threat from substitutes due to the availability of alternative toys and entertainment options for children.

Bargaining Power Of Customers

JAKKS Pacific, Inc. has a high bargaining power of customers due to the presence of large retailers like Walmart and Target, which can exert pressure on prices and terms.

Bargaining Power Of Suppliers

JAKKS Pacific, Inc. has a low bargaining power of suppliers due to its diversified supplier base and lack of dependence on a single supplier.

Threat Of New Entrants

JAKKS Pacific, Inc. faces a moderate threat from new entrants due to the presence of barriers to entry, such as high capital requirements and established distribution networks.

Intensity Of Rivalry

JAKKS Pacific, Inc. operates in a highly competitive industry with many established players, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 10.96%
Debt Cost 3.95%
Equity Weight 89.04%
Equity Cost 15.96%
WACC 14.65%
Leverage 12.31%

11. Quality Control: JAKKS Pacific, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Johnson Outdoors

A-Score: 5.4/10

Value: 8.7

Growth: 1.9

Quality: 3.3

Yield: 5.0

Momentum: 8.0

Volatility: 5.3

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Vista Outdoor

A-Score: 4.5/10

Value: 5.2

Growth: 5.0

Quality: 5.7

Yield: 0.0

Momentum: 5.0

Volatility: 6.0

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JAKKS Pacific

A-Score: 4.1/10

Value: 5.9

Growth: 4.4

Quality: 4.6

Yield: 4.0

Momentum: 2.0

Volatility: 4.0

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Xponential Fitness

A-Score: 3.7/10

Value: 8.5

Growth: 5.7

Quality: 5.5

Yield: 0.0

Momentum: 1.5

Volatility: 1.0

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American Outdoor Brands

A-Score: 3.6/10

Value: 6.9

Growth: 4.2

Quality: 4.2

Yield: 0.0

Momentum: 3.0

Volatility: 3.3

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Inspirato

A-Score: 3.3/10

Value: 9.8

Growth: 2.6

Quality: 5.5

Yield: 0.0

Momentum: 0.5

Volatility: 1.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

16.61$

Current Price

16.61$

Potential

-0.00%

Expected Cash-Flows