Pop culture collectibles manufacturer Funko (NASDAQ:FNKO) will be reporting results tomorrow after market close. Here's what investors should know.

Funko beat analysts' revenue expectations by 3.3% last quarter, reporting revenues of $291.2 million, down 12.6% year on year. It was a weaker quarter for the company, with a miss of analysts' operating margin estimates and full-year revenue guidance missing analysts' expectations.

Is Funko a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Funko's revenue to decline 12.5% year on year to $220.3 million, improving from the 18.3% decrease it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.30 per share.

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Funko has only missed Wall Street's revenue estimates once over the last two years, exceeding top-line expectations by 6.8% on average.

Looking at Funko's peers in the toys and electronics segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Mattel posted flat year-on-year revenue, missing analysts' expectations by 2.8%, and Sonos reported a revenue decline of 16.9%, topping estimates by 2.1%. Mattel traded up 2.2% following the results.

Read our full analysis of Mattel's results here and Sonos's results here.

Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride as the market switches between optimism and pessimism around rate cuts thanks to mixed inflation data, and while some of the toys and electronics stocks have fared somewhat better, they have not been spared, with share prices down 2.1% on average over the last month. Funko is up 18.9% during the same time and is heading into earnings with an average analyst price target of $8.6 (compared to the current share price of $6.78).

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