How’s the toy business?
That’s a question I hear countless times each month, and lately, I haven’t had a simple answer aside from “It’s playful.”
We’re days away from the end of the first quarter and while few probably want to admit it, Q1 is going out with a whimper. Speaking to contacts across mass and specialty channels, the general consensus is that foot traffic is down and there haven’t been any clear hits yet this year. Spring is officially here and it’s safe to say that this past winter was another dud for toymakers looking to move cold-weather toys like sleds and inflatables as warmer temperatures melted hopes for sales.
Speaking of cold weather, Sony’s Ghostbusters: Frozen Empire hit theaters last weekend (my whole family loved it), scoring the top spot without much support in the toy department. Hasbro released a modest range of mostly kid-focused toys and collectibles that barely made a blip on the radar in the weeks leading up to the film’s debut. At a few local Walmart stores, new products, including an updated Ecto-1 vehicle and assorted role-play items were already on clearance by Friday, further indicating a big disconnect between content and consumer products. While Hasbro is wisely pulling back the reins a bit on production, did this product even have a chance to succeed at retail? No statement. No excitement. No sales.
How Many Credits Does GameStop Have Left?
Speaking of retail, GameStop continues its downward spiral with no clear plan for a rebound. If a plan exists, it’s being held close to the chest of recently crowned Chairman and CEO Ryan Cohen. The mass specialty retailer reported its Q4 and full-year 2023 earnings this week and the results weren’t good. Net sales in Q4 fell off a cliff to land at $1.794 billion compared to $2.226 billion in 2022. Full year sales slipped to $5.273 billion, down from $5.927 billion in 2022. Beyond the customary earnings release and SEC filings, GameStop continued its recent tradition of radio silence from management with no earnings call or executive commentary to accompany its reports.
Beyond the meme-tastic and movie-inspiring madness of the $GME “apes” during the pandemic era, GameStop continues to drag itself along, seemingly devoid of focus and purpose. Its business, divided into three reporting segments — Hardware and Accessories, Software, and Collectibles — continues to slide. GameStop defines its collectibles business as consisting of “apparel, toys, trading cards, gadgets, and other retail products for pop culture and technology enthusiasts.” That said, GameStop remains an important outlet for the sales of products from many players within our industry — and it’s an outlet with thousands of stores at risk of going away. According to this week’s form 10-K, GameStop operates more 4,000 stores around the world. Less than a decade ago, that number was more than 7,000. Despite a decline, GameStop still moved more than $754 million in collectibles last year.
The retailer declined to elaborate but did disclose an unspecified “headcount reduction” (layoffs).
I believe that GameStop can still survive, but the clock is ticking. I’ll take a call from GameStop at any time if Ryan and the crew need some direction.
The Laugh Factory Taps David Fuhrer as President; Makes a Play for TikTok
We’re close enough to April 1 that I get wary of any “news” that appears to be from out of nowhere, so when this hit my inbox I reached out to verify it myself: Blue Square Innovations Founder David Fuhrer has joined the legendary Laugh Factory as President. The prolific inventor and entrepreneur behind the licensing of more than 300 toys, games, and other products is jumping into the new gig with eyes on a real big catch: TikTok.
Following the much-buzzed-about possibility that the U.S. may issue a mandate for TikTok’s parent, China-based ByteDance, to sell the platform to a domestic company, Fuhrer is “assembling a team of top investment and digital media experts to ensure TikTok not only prevails but flourishes under new ownership.”
Our vision transcends mere acquisition. We aim to cultivate a vibrant, global community where positivity and humor are paramount. TikTok holds boundless potential; what it needs is leadership committed to redirecting its course towards a future filled with hope and laughter."
TikTok, despite its often divisive nature, has been a place where toy and game makers — and comics — have thrived. To illustrate the strength and importance of TikTok, The Laugh Factory points out that Kevin Hart, Tiffany Haddish, Matt Rife, noted Funko enthusiast Gabriel “Fluffy” Iglesias, and Chris Rock boast a combined social media following of more than 300 million people.
“For nearly 45 years our mission has been to spread laughter and humor across the globe,” says Laugh Factory Founder and CEO Jamie Masada. “Today we are taking that mission to the next level by setting our sights on acquiring TikTok, with the aim of making it the premier social site for laughter and positivity worldwide. The competition for this acquisition may be intense, but the Laugh Factory brings something unique and priceless to the table — the power of laughter and lifelong commitment to transform TikTok into a force for good.”
Can they pull it off? Stay tuned!
