But one businessman is determined to bring the bankrupt toy store franchise back to life.
"I will make Toys R Us a fun place again," toy mogul Isaac Larian tells NPR's Rachel Martin.
To do that, Larian is raising money through a GoFundMe campaign. Larian is the CEO of MGA Entertainment — and launched last year's breakout toy hit, L.O.L. Surprise, as well as the Bratz line of dolls and Little Tikes, all of which are sold in Toys R Us stores.
The campaign itself relies on nostalgic appeal for a childhood icon — one that spans generations and includes a catchy commercial jingle. "You can be a part of this historic movement to #SaveToysRUs by donating today!" the campaign page says. "Your donation will help to ensure that generations to come can 'always be a Toys R Us kid' and save employee jobs that are at stake should the company cease operation."
So far, the #SaveToysRUs campaign to raise $1 billion has brought in a little over $2oo million — though most of that is a pledge from Larian and other big investors. The rest is from people making smaller donations in return for stickers and toys. (According to the campaign, if the goal is not met by May 28 and the donations are not used to buy Toys R Us, the money will be returned.)
Toys R Us announced last month that it would go out of business, telling its more than 30,000 employees (including those at Babies R Us) that it would sell or close all of its U.S. stores. The chain's problem, as described by NPR's Alina Selyukh, has been managing its debt:
Toys R Us has struggled with a heavy load of debt inherited from a 2005 buyout, as well as intense competition from Walmart, Amazon and Target — made worse by disappointing holiday sales.
The chain — whose history traces back to a post-World War II baby furniture store — has spent many decades as the country's largest dedicated toy emporium. In 2017, Toys R Us accounted for roughly one-fifth of toy sales in the U.S., according to Jefferies analyst Stephanie Wissink.
But in recent years, Toys R Us has found itself amid a trifecta of demographic and social changes, Wissink says.
Today's parents are the millennial generation who grew up with the Internet and approach purchasing decisions and time they spend with children differently from baby boomers. Generally, foot traffic is falling at brick-and-mortar stores. And children are playing differently than they used to decades ago.
Larian says if he is able to buy it, he plans to reinvest in the company in ways the chain has been unable to because of the debt — though he would likely keep only about 150 to 200 of its 735 U.S. stores.
As for his imagined revamp, he won't give details. "We are still competing to buy Toys R Us, and I don't want other people to know what we plan to do," he says. "It's not going to be a minor thing. It's going to be a major thing."
Other potential buyers, he says, would simply flip the company, and if that happens, "Toys R Us is not going to last. It needs a crazy person who lives, breathes and eats toys like I do."
Morning Edition's Vince Pearson and Jessica Smith produced and edited this story for broadcast.