Funko: Steer Clear Due to Limited Visibility and Recession Fears

Funko has been downgraded due to limited visibility. The company's performance has been impacted by the ongoing COVID-19 pandemic, which has resulted in reduced consumer spending and a decline in sales. Despite being a popular brand, Funko's earnings are not immune to the economic downturn.

Funko, the popular toy company known for its Pop! figurines, has been downgraded by analysts due to limited visibility and financial challenges. The company's performance has been significantly impacted by the ongoing COVID-19 pandemic, which has led to reduced consumer spending and a decline in sales. Despite being a well-recognized brand, Funko's earnings are not immune to the economic downturn.

The company replaced its CEO, Cynthia Williams, after just one year on the job, naming board member and former CEO Michael Lunsford as interim head to reverse the company's slumping fortunes. Revenue has fallen for two consecutive years following a pandemic surge, and it is expected to decline again in 2025 [2]. Shares of Funko have dropped more than 50% in the past year, with the company facing challenges from tariffs and the rising cost of materials.

In response to these challenges, Funko raised the suggested price of its basic Pop! figure to $15 from $12 in May. CEO Lunsford stated that the recent changes in the global business environment have constrained the company's growth initiatives, but the company remains focused on long-term growth [2].

The ongoing economic downturn and the uncertainty surrounding tariffs have put additional pressure on Funko's financial performance. The company's ability to navigate these challenges and return to profitability will be a key indicator of its future success. Investors and financial professionals should closely monitor Funko's progress as it seeks to reverse its financial fortunes.

References:
[1] https://www.usatoday.com/story/money/2025/05/01/trump-tariffs-amazon/83392944007/
[2] https://www.businesstimes.com.sg/companies-markets/funko-replaces-ceo-after-one-year-amid-losses-falling-sales