“Five Night’s at Freddy’s” was Funko’s top-selling property in 2017, generating 8% ($40 million) of the company’s $516 million in annual revenue, though its volume and share of the company’s business ($63 million, or 15%)  dropped from the year before, when the company had  $426.7 million in revenue, the company said in a 10K filed with the SEC. Funko is master toy licensee for the game; its agreement runs through 2021.

Disney was Funko’s top licensor for the year, accounting for 33% of its revenue across Disney, Marvel and Lucasfilm properties, up from 31% a year earlier. Evergreen classic properties accounted for 45% of Funko’s revenue, up from 43% a year earlier.  Products based on new film releases generated 21% (down from 24%), TV properties, led by Stranger Things,18% (up from 12%) and video games 15% (compared to 20% a year earlier). Funko’s Pop! figures accounted for 70% of sales, up from 64% in 2016. Direct-to-consumer sales, an area the company wants to expand, generated 6% of total revenue.

Sales to GameStop accounted for 8% of Funko’s total, down from 12% a year earlier, while those to Hot Topic remained at 9%. Toys R Us accounted for 3.4% of 2017 sales; Funko had $2 million in unpaid receivables with the chain, which filed for liquidation earlier this month, as of Dec. 31. 

Meanwhile, the company said it’s phasing out its subscription box business this year. Funko is converting products developed for the boxes to retail exclusives, although it hasn’t been determined which chains will get them, the company said on its web site. The DC Legion of Collectors was the first subscription box service to end on March 2 and will be followed by Disney Treasures (April 2) Marvel Collector Corps (April 6) and Smuggler’s Bounty (Lucasfilm, Sept. 16). Funko launched the service with Marvel in 2015.

Funko’s net income for the year declined to $3.7 million from $26.6 million, in part  impacted by costs related to the acquisitions of  Loungefly and Underground Toys. Revenues from outside the U.S. accounted for 26% of the total, up from 19% a year earlier, due largely to its purchase of Underground, which had been its distributor in Europe.

Contact: Russell Nickel, Chief Financial Officer, 425-783-3616, scott@funko.com