CNN reported that almost thirty million dollars worth of Funko, the pop-culture dolls, are on its way to a new collector. The media said it is the garbage collector. The fourth quarter earnings report of Funko presents significant financial trouble. The report is somehow a combination of low demands for the toys and inventory surplus. Plus, last year they even rented warehouse space just for keep holding the buildup of figurines.
In the last quarter of 2022, the company was holding around $246.4 million worth of dolls. Actually it was 48% more than what they had on hand a year before. They plan for the first half of 2023. It is to eliminate a bit of that nearly $250 million in inventory. This is in an attempt to reduce fulfillment costs. Thus, by managing inventory levels, hopefully it could align with the operating capacity as well as distribution center. In a nutshell, the product would be storing the worth which costs is actually bigger than keeping it on hand. Therefore, the dump at least $30 million worth of Funko.
CEO Brian Mariotti delivered a call with investors. He said that Funko had filled its Arizona distributing center to spread the dolls. They also need to rent more storage containers for them. He added that this extra storage costs also made the company losing money at stake. In addition, Funko’s company executives also announced that they would reduce 10% of their workforce. This is in order to save more costs. The company reported $47 million total loss. Meanwhile in the same period a year before, the company earned $17 million profit.