Funko Pop is in survival mode. In their latest earnings report. The company warned investors there’s “substantial doubt” about their ability to maintain operations for the next twelve months.
With $241 million in debt and the risk of defaulting on its loans, Funko’s future looks shaky at best. Their latest earnings report revealed a quarterly loss of $1 million, a huge dip from the $8 million profit they made back in 2024.
Drowning in Its Own Inventory
Funko’s been here before. In 2023, they threw out millions of unsold Pop figures because warehouses were overflowing.
You’d think Funko would learn a valuable lesson about the downside of oversaturation right? Nope! The company continues to flood the market with endless waves of figures. All while missing the fact that no one’s excited anymore.
Between the massive success of Labubu, in addition to more toy companies selling mystery boxes that simulate loot box mechanics, there’s not a place for Funko Pop anymore.
Again, you’d think the company would take notice of this right? Well…
Innovation or Imitation?
Funko’s new CEO, Josh Simon, has a plan to turn things around. His “Make Culture Pop” strategy aims to leverage Funko’s brand and fan community while pushing short-term survival tactics. The problem is that nothing about this strategy feels new.
A big part of Funko’s strategy is their new Bitty Pop! line of bite-sized collectables.
“We are also planning new innovative retail experiences, such as selling Bitty Pop products through vending machines with a surprise or mystery element to the purchase experience,”
The company’s so-called innovation looks exactly like what every other toy brand is already doing. Selling pint-sized collectables in loot boxes to encourage overspending. It’s a concept that’s been popularized by countless blind-box sellers.
Chasing Trends Instead of Innovating
To stay relevant, Funko’s betting on the release of the final season of Stranger Things and the upcoming musical film Wicked: For Good. Sure, those franchises are insanely popular, but that doesn’t mean the hype will translate into sales.
At one point, Funko Pops were the collectable toys to get. They were the little totems you loved to see on your desk or a shelf.. Now, they feel like a callback to a forgotten era of pop culture.
The Fatigue Factor
I think people are having a sense of collectible fatigue. Between Labubu’s dominance and the growing skepticism toward blind-boxes, collectors are tired. The thrill isn’t worth the price tag anymore.
Funko isn’t reading the room. They’re assuming they can be the next Pop Mart by replicating its strategy. It’s the same cycle that led them here in the first place. Chasing short-term excitement instead of long-term loyalty.
A Company Out of Ideas
Funko could reinvent itself, but instead, they’re stuck in a loop. Manufacturing more toys, selling less toys, and calling it a comeback.If Funko wants to survive, it needs to do more than sell pint-sized figurines. It needs to reimagine what a popular collectible looks like in 2025. Right now, it’s selling a bad habit, and that’s not enough to keep the lights on.
