JAKKS Pacific Reports 2.9% Decline in Net Sales for Fiscal Year 2024

JAKKS Pacific, Inc. reported a decline in financial performance for the fiscal year ending December 31, 2024, with net sales totaling $691.0 million, a decrease of 2.9% from $711.6 million in 2023. The company's net income also fell to $34.2 million, down from $38.1 million the previous year, resulting in a net income margin of 4.9%. The decrease in revenue was attributed to lower sales across several product categories, particularly in the Dolls, Role Play and Dress Up Division, and the Action Play & Collectibles Division. The company noted that while new movie properties contributed to sales, they were offset by weaker performance from prior year releases.

In terms of operational changes, JAKKS Pacific has made significant strides in its international sales, which accounted for approximately $146.0 million, or 21.1% of total net sales in 2024, compared to $153.7 million, or 21.6%, in 2023. The company has expanded its distribution capabilities in Europe, opening new warehouses in Italy and Belgium, and has shifted from a distributor model to direct sales in several countries, including Spain and France. The total employee headcount as of December 31, 2024, was approximately 680, with 47% of the workforce located outside the U.S.

The company has also focused on managing its costs, with total selling, general, and administrative expenses rising to $173.3 million, or 25.1% of net sales, compared to 23.1% in 2023. This increase was primarily driven by higher media costs, product development expenses, and employee compensation. JAKKS Pacific has been actively pursuing strategic acquisitions and licensing agreements to enhance its product offerings, with a focus on evergreen brands that are less susceptible to market trends.

Looking ahead, JAKKS Pacific has expressed cautious optimism about its growth strategy, which includes expanding its core product lines and entering new product categories. The company plans to continue leveraging its relationships with major retailers, including Target, Walmart, and Amazon, which collectively accounted for 64.4% of net sales in 2024. However, the company acknowledged potential risks, including market acceptance of new products, competition, and economic conditions that could impact future performance. The management remains committed to enhancing operational efficiencies and maintaining a strong balance sheet to support its growth initiatives.