The Maker of Nabi Kids' Tablet Is Canceling Orders

  • Fuhu also said to cancel on Target, Toys `R' Us and Best Buy
  • Company introduced first tablet under the Nabi brand in 2011

Fuhu Inc., the maker of the Nabi brand of children’s tablet computers, has canceled shipments to Wal-Mart Stores Inc. and other major retailers because of a financial dispute with supplier and investor Foxconn, according to people familiar with the situation.

Fuhu recently pulled orders for Target Corp., Best Buy Co. and Toys “R” Us Inc., leaving some of the chains in a rush to fill out their inventory ahead of the holiday season, according to the people, who asked not to be identified because the matter is private.

Nabi Jr.

The Nabi Jr. tablet. Source: Nickelodeon/PRNewsFoto

Foxconn, part of a massive electronics manufacturer with operations in China that also makes the iPhone and other technology, is holding the inventory, said the people. Foxconn owns a stake in Fuhu as well, according to the tablet company’s website.

Retailers are now searching for ways to fill the void, including buying the Nabi tablets directly from Foxconn, one of the people said. Wal-Mart listed a 5-inch Nabi device in its printed ad for Black Friday, the kickoff to the holiday season.

Growth Story

The cancellations mark a dramatic setback for El Segundo, California-based Fuhu. The company was ranked by Inc. magazine as the fastest-growing private company in the U.S. for 2014, with a three-year sales growth rate of almost 159,000 percent. Fuhu, which also lists DreamWorks Animation SKG Inc. as an investor, had about $195.6 million in revenue in 2013, according to Inc.

Representatives from Fuhu and Foxconn didn’t respond to requests for comment, while Wal-Mart and Target declined to comment. Though Toys “R” Us and Best Buy also declined to comment on Fuhu, they both said they had ample tablet inventory from several manufacturers for the holiday season.

Fuhu, a closely held company, released its first tablet in 2011. It later expanded to three devices that each targeted a different stage of childhood. Fuhu’s current lineup includes six tablets, including the 5-inch Nabi Jr. and the Nabi Press Tab, along with a $9.99-a-month subscription service.

In the past two years, Fuhu has faced more competition and slowing demand for tablets. Apple Inc. now sells a wider variety of tablets, and tech heavyweights such as Samsung Electronics Co. and Inc. also offer devices specifically aimed at kids.

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