Funko, Inc.FNKO
Funko, Inc. Goodwill & Intangibles Disclosure
Goodwill and Intangible Assets
Goodwill represents the excess of the purchase price over the net amount of identifiable assets acquired and liabilities assumed in a business combination measured at fair value. The Company evaluates goodwill for impairment annually on October 1 of each year and upon the occurrence of triggering events or substantive changes in circumstances that could indicate a potential impairment by assessing qualitative factors or performing a quantitative analysis in determining whether it is more likely than not that the fair value of the net assets is below their carrying amounts. The Company has determined that it has one reporting unit for which discrete financial information is available and results are regularly reviewed by management.
The Company determined as of its annual October 1, 2025 goodwill impairment assessment, it was more likely than not that the fair value of the reporting unit was above the carrying value of the net assets. During the year ended December 31, 2025, the Company observed a significant decline in the market valuation of the Company’s Class A common stock along with a volatile macroeconomic environment. As a result, the Company has evaluated potential goodwill impairment triggering events as of December 31, 2025, and determined it was more likely than not that the fair value of the reporting unit was above carrying value of the net assets. However, the Company will continue to evaluate for impairment triggering events due to the substantive changes in circumstances, such as market capitalization, which could indicate a potential impairment and the need to record a material, non-cash charge in a future period. The Company will continue to monitor conditions that may indicate the need for a recoverability assessment of the carrying value of the identified intangible and other long-lived assets.
No impairment charges relating to goodwill were recorded in the years ended December 31, 2025, 2024 and 2023.
The following table presents the balances of goodwill as of 2025 and 2024 (in thousands):
Goodwill | |||||
| Balance as of January 1, 2024 | $ | 133,795 | |||
| Reclassification to assets held-for-sale | (87) | ||||
| Foreign currency remeasurement | (56) | ||||
| Balance as of December 31, 2024 | $ | 133,652 | |||
| Foreign currency remeasurement | 248 | ||||
| Balance as of December 31, 2025 | $ | 133,900 | |||
Intangible assets acquired in a business combination are recognized separately from goodwill and are initially recognized at their fair value at the acquisition date. Intangible assets acquired include intellectual property (product design), customer and licensor relationships, and trade names. These are definite-lived assets and are amortized on a straight-line basis over their estimated useful lives. As of December 31, 2025 and 2024, there were also immaterial indefinite-lived assets not subject to amortization but tested for impairment. There were immaterial impairment charges relating to indefinite-lived intangible assets recorded in the years ended December 31, 2025, 2024 and 2023, respectively.
The following table provides the details of remaining identified intangible assets, by major class, for the periods indicated (in thousands):
| December 31, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||
Estimated Useful Life (Years) | Gross Carrying Amount | Accumulated Amortization | Intangible Assets, Net | Gross Carrying Amount | Accumulated Amortization | Intangible Assets, Net | |||||||||||||||||||||||||||||||||||
| Intangible assets subject to amortization: | |||||||||||||||||||||||||||||||||||||||||
| Intellectual property | 3 - 20 | $ | 114,611 | $ | (58,359) | $ | 56,252 | $ | 114,611 | $ | (52,638) | $ | 61,973 | ||||||||||||||||||||||||||||
| Trade names | 10 - 20 | 92,528 | (46,161) | 46,367 | 92,528 | (40,977) | 51,551 | ||||||||||||||||||||||||||||||||||
| Customer relationships | 3 - 20 | 69,092 | (37,479) | 31,613 | 68,821 | (33,490) | 35,331 | ||||||||||||||||||||||||||||||||||
| Licensor relationships | 10 - 20 | 11,258 | (9,680) | 1,578 | 11,074 | (8,409) | 2,665 | ||||||||||||||||||||||||||||||||||
| Total | $ | 287,489 | $ | (151,679) | $ | 135,810 | $ | 287,034 | $ | (135,514) | $ | 151,520 | |||||||||||||||||||||||||||||
Amortization expense for the years ended December 31, 2025, 2024 and 2023 was $15.8 million, respectively. The future five-year amortization of intangibles subject to amortization at December 31, 2025 was as follows (in thousands):
| Amortization | |||||
| 2026 | $ | 15,641 | |||
| 2027 | 14,535 | ||||
| 2028 | 13,862 | ||||
| 2029 | 13,862 | ||||
| 2030 | 13,862 | ||||
| Thereafter | 64,048 | ||||
| Total | $ | 135,810 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 12, 2026 | Showing above |
| 2024 | Mar 13, 2025 | |
| 2023 | Mar 7, 2024 | |
| 2022 | Mar 1, 2023 | |
| 2021 | Mar 3, 2022 | |
| 2020 | Mar 11, 2021 | |
| 2019 | Mar 5, 2020 | |
| 2018 | Mar 6, 2019 | |
| 2017 | Mar 19, 2018 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.