If calibration is needed, the display will show a "C" instead of the heading, but that wouldn't cause flashing on and off.
Flashing on and off sounds like a loose connection either in the wire harness or inside the mirror. There is a green indicator on your mirror that shows if the auto-dimming function is enabled. If this is staying lit while the compass is flashing, you may have a loose connection in the mirror. If the green indicator is also flashing, you may have a loose connection in the power harness.
That's possible, I didn't recall that they 4Runners used a "C" for their mirror; I know all the FJ's I have done have either had the compass reading weirdly or the "Compass" light blinking.
That being said, a loose connection is also likely; there should be a 3~4 wire plug on the backside of the mirror on the left hand side; give it a little wiggle and maybe even unplug & plug it in once or twice and see if that improves the condition. I would also take note of what [MENTION=124177]Geerlijd[/MENTION] said as it will help give you an idea if there's an issue with power/ground going into the mirror, and/or an issue with the mirror itself.
In case you want to just go ahead and give the calibration a shot anyways or save it for later:
(a) Turn the ignition switch to the “ON” position and push and hold the switch for 6 seconds until the zone number appears on the compass display
(b) Push the switch to select the number of the zone where the vehicle is located.
See the map below for zone reference.
(c) Start the engine and push and hold the switch for about 9 seconds until “C” appears on the display.
(d) Drive the vehicle slowly at 5 mph(8 km/h), or less, in a circle until the direction is displayed. If there is NOT enough space to drive in a circle, turn the car around as shown, doing two three-point turns in succession.
After driving in 1 to 3 circles in the above method, calibration is complete with the direction shown on the display
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The "Zone Number" is the number of line that is closest to where you live.