Dive Brief:
- Continuing to work toward its $1 billion cost-savings goal, Hasbro’s first-quarter revenue increased 17% year over year to about $887 million, according to a company press release Thursday. This was driven by 46% growth in its Wizards of the Coast and Digital Gaming segment, which includes the Magic: The Gathering and Dungeons & Dragons games.
- Hasbro Chief Operating and Financial Officer Gina Goetter said in a statement that the company’s asset-light model is in part helping to offset tariff pressures, which “had no material impact on Q1 results due to timing of implementation,” per the release.
- On the company’s earnings call, CEO Chris Cocks noted that its licensing business is primarily digital and its toy segment (which has more exposure) is able to rapidly shift production.
Dive Insight:
Hasbro did not change its full-year guidance issued in February, citing the uncertainty of the current trade environment.
“While targeted pricing actions remain likely, we are prioritizing key price points and strengthening retail partnerships,” Cocks said on the earnings call.
The chief executive later remarked that despite Hasbro’s positioning and flexibility, logistics are becoming more complex, with tariffs translating into higher consumer prices, potential job cuts and reduced shareholder returns.
The toy company’s operating profit for the quarter jumped about 46% to around $170 million. Revenue in its consumer products segment was down 4% while its entertainment segment saw a 5% drop.
Hasbro’s investor presentation called out a further decrease in its owned inventory, with total first-quarter owned inventory down 12% year over year. Its latest quarterly results come after the company announced a new turnaround plan in February that included a focus on driving mid-single-digit revenue growth between 2025 and 2027, in addition to $1 billion in gross cost savings.
The toy company reported that its 2024 fiscal year revenue declined 17%, mostly due to the divestiture of its film and TV business. Part of Hasbro’s new plan is to focus on building profitable franchises, and on Thursday the company announced a multiyear extension to its toys and games partnership with Disney Consumer Products for the Star Wars and Marvel brands.
Hasbro’s CEO voiced the company’s support for The Toy Association’s advocacy of zero tariffs on toys and games globally. The Toy Association, earlier this month, released the results of a member survey it conducted on the impact of the Trump administration’s imposed 145% tariffs on toy imports from China.
The survey, which featured input from over 400 member companies, found that about half of small- and medium-sized enterprises said they may soon go out of business due to the current U.S. tariff policy.