Shares of Funko (NASDAQ:FNKO) were tumbling more than 11% lower in morning trading Friday, following the company's second-quarter earnings report. The results, released after the market closed yesterday, show that revenue fell 49% from the year-ago period, leading to a net loss of $15 million, or $0.30 per share.
Because traditional retailers like GameStop -- where Funko usually sells its toys based on movie and TV content -- closed throughout most of the quarter, sales plummeted during the period.
Yet the toymaker said consumer demand remained strong in digital channels, including its own e-commerce platform, where sales surged more than threefold from last year.
Investors shouldn't have been surprised Funko took the hit it did, but it's likely the sell-off stemmed from sales declining more than expected. First-quarter sales had fallen only 18% year over year, and this quarter saw the coronavirus pandemic wipe out more than 70% of its international sales.
However, that was due in part to the company choosing to make the "strategic decision" to delay new product introductions from the second quarter into the third.
Because the COVID-19 situation remains fluid and uncertain, Funko is not issuing guidance for the full year of 2020.