Understanding Jakks (JAKK) Reliance on International Revenue

Did you analyze how Jakks Pacific (JAKK) fared in its international operations for the quarter ending March 2025? Given the widespread global presence of this toymaker, scrutinizing the trends in international revenues becomes imperative to assess its financial strength and future growth possibilities.

In the current global economy, which is more interconnected than ever, a company's success in penetrating international markets is crucial for its financial health and growth journey. Investors must understand a company's dependence on overseas markets, as this offers a window into the company's earnings stability, its ability to benefit from varied economic cycles and its potential for long-term growth.

International market involvement serves as insurance against economic downturns at home and enables engagement with economies that are growing more quickly. Still, this move toward diversification is not without its challenges, as it involves navigating through the fluctuations of currencies, geopolitical threats, and the distinctive nature of various markets.

In our recent assessment of JAKK's quarterly performance, we discovered notable trends in its overseas revenue sections, which are typically modeled and scrutinized by Wall Street analysts.

For the quarter, the company's total revenue amounted to $113.25 million, experiencing an increase of 25.7% year over year. Next, we'll explore the breakdown of JAKK's international revenue to understand the importance of its overseas business operations.

Unveiling Trends in JAKK's International Revenues

Latin America generated $7.46 million in revenues for the company in the last quarter, constituting 6.59% of the total. This represented a surprise of +48% compared to the $5.04 million projected by Wall Street analysts. Comparatively, in the previous quarter, Latin America accounted for $4.29 million (3.28%), and in the year-ago quarter, it contributed $8 million (8.88%) to the total revenue.

Canada accounted for 2.90% of the company's total revenue during the quarter, translating to $3.28 million. Revenues from this region represented a surprise of +6.12%, with Wall Street analysts collectively expecting $3.09 million. When compared to the preceding quarter and the same quarter in the previous year, Canada contributed $4.26 million (3.26%) and $3.37 million (3.74%) to the total revenue, respectively.

During the quarter, Australia and New Zealand contributed $0.61 million in revenue, making up 0.54% of the total revenue. When compared to the consensus estimate of $1.13 million, this meant a surprise of -45.75%. Looking back, Australia and New Zealand contributed $1.12 million, or 0.85%, in the previous quarter, and $1.35 million, or 1.49%, in the same quarter of the previous year.

Of the total revenue, $0.4 million came from Middle East and Africa during the last fiscal quarter, accounting for 0.35%. This represented a surprise of +58.8% as analysts had expected the region to contribute $0.25 million to the total revenue. In comparison, the region contributed $0.73 million, or 0.56%, and $0.23 million, or 0.26%, to total revenue in the previous and year-ago quarters, respectively.

Asia accounted for 0.66% of the company's total revenue during the quarter, translating to $0.75 million. Revenues from this region represented a surprise of -19.25%, with Wall Street analysts collectively expecting $0.93 million. When compared to the preceding quarter and the same quarter in the previous year, Asia contributed $1.52 million (1.16%) and $0.97 million (1.07%) to the total revenue, respectively.

During the quarter, Europe contributed $11.81 million in revenue, making up 10.43% of the total revenue. When compared to the consensus estimate of $9.45 million, this meant a surprise of +24.97%. Looking back, Europe contributed $25.36 million, or 19.40%, in the previous quarter, and $5.74 million, or 6.37%, in the same quarter of the previous year.

International Revenue Predictions

Wall Street analysts expect Jakks to report a total revenue of $146.55 million in the current fiscal quarter, which suggests a decline of 1.4% from the prior-year quarter. Revenue shares from Latin America, Canada, Australia and New Zealand, Middle East and Africa, Asia and Europe are predicted to be 4.7%, 3.4%, 1.2%, 0.3%, 1% and 11.6%, corresponding to amounts of $6.94 million, $4.91 million, $1.76 million, $0.41 million, $1.5 million and $16.94 million, respectively.

For the full year, a total revenue of $699.94 million is expected for the company, reflecting an increase of 1.3% from the year before. The revenues from Latin America, Canada, Australia and New Zealand, Middle East and Africa, Asia and Europe are expected to make up 5%, 3.1%, 1.1%, 0.3%, 1% and 11.8% of this total, corresponding to $35.22 million, $21.83 million, $7.89 million, $2.17 million, $6.92 million and $82.55 million respectively.

Key Takeaways

Jakks' leaning on foreign markets for its revenue stream presents a mix of chances and challenges. Therefore, a vigilant watch on its international revenue movements can greatly aid in projecting the company's future direction.

In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.

At Zacks, a company's changing earnings outlook is given considerable attention due to its proven, strong influence on a stock's price performance in the near term. The connection here is straightforward and positive: when earnings estimates are revised upward, the stock price generally follows suit, increasing as well.

Boasting a remarkable track record that's been externally verified, the Zacks Rank, our unique stock rating system, leverages changes in earnings projections to function as a reliable gauge for predicting short-term stock price movements.

Currently, Jakks holds a Zacks Rank #2 (Buy), signifying its potential to outperform the overall market's performance in the forthcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Reviewing Jakks' Recent Stock Price Trends

Over the preceding four weeks, the stock's value has appreciated by 18.2%, against an upturn of 9.1% in the Zacks S&P 500 composite. In parallel, the Zacks Consumer Discretionary sector, which counts Jakks among its entities, has appreciated by 16.2%. Over the past three months, the company's shares have seen a decline of 34.8% versus the S&P 500's 3.1% decline. The sector overall has witnessed a decline of 1.9% over the same period.

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JAKKS Pacific, Inc. (JAKK): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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