(WTAJ) — Funko is looking to throw $30 million worth of their Funko Pop! figures right in the trash.
The company held its quarterly meeting with shareholders and announced that inventory increased by 48% compared to the end of 2021.
“Inventory at year-end totaled $246.4 million, an increase of 48% compared to a year ago,” according to an official Funko press release. “This includes inventory that the company intends to eliminate in the first half of 2023 to reduce fulfillment costs by managing inventory levels to align with the operating capacity of our distribution center. This is expected to result in a write-down in the first half of 2023 of approximately $30 to $36 million.”
In essence, Funko explained that the company currently has too much inventory for its own warehouses, and that it’s cheaper to throw it away than to pay for storage at third-party facilities.
“During the fourth quarter and in early 2023, we have made progress in addressing operational issues that impacted our results in the second half of 2022,” added CEO Brian Mariotti.
Mariotti indicated, however, that the brand is still seeing “strong consumer demand from our incredibly loyal and resilient global fanbase, as demonstrated by 37% direct-to-consumer growth and strong sell-through in the fourth quarter.”