First quarter earnings season continues with Hasbro checking in with financials for the start of 2024.
While the company beat Wall St. estimates on profit and margin, revenue slid 24% versus Q1 last year amid a massive 21% decline in its Consumer Products segment which includes toys and games.
Hasbro attributes the decline to the offloading of its eOne film and TV business and the continued inventory cleanup that sent closeout product en masse to the likes of Ollie’s, Ross Dress for Less, TJ Maxx, Burlington, and other outlets last year.
The first quarter was a good start to the year for Hasbro; we are continuing to see the results of our transformation work. Performance from our licensing portfolio shows the strength of our brands and we continue to fuel innovation in games and toys as we expand our reach across play patterns to fans of all ages."
Wizards of the Coast and Digital Gaming saw revenue grow 7% while Entertainment — driven by Peppa Pig — saw a 65% spike absent the 85% hit from the eOne sale.
“We made solid progress in our turnaround efforts in the first quarter,” said Gina Goetter, Hasbro, Chief Financial Officer. “We landed revenue where we expected and drove significant operating profit improvement led by our operational excellence program and improved business mix. We remain on track for our full-year commitments.”
Looking ahead, Hasbro expects Consumer Products revenue for the year to decline 7-12%; Wizards of the Coast revenue to dip 3-5%; and Pro-forma Entertainment revenue to decline by $15 million amid the greater turnaround and reinvention of the business.
In Q1, the company says that the relaunched Furby brand continued to perform well alongside 41% growth in Peppa Pig (41%), Hasbro Gaming (6%), Magic the Gathering (4%), and Dungeons & Dragons (3%).
This year, the fruits of Hasbro’s licensing efforts should start to pay off. For those playing along at home, Littlest Pet Shop relaunched via Basic Fun! in January to a solid response from retailers and consumers; Just Play is rolling out refreshed lines for Easy-Bake and FurReal Friends; and the Playskool portfolio lives with PlayMonster.
This week, Hasbro revealed a licensing deal with Playmates Toys under which Playmates will take over production of Power Rangers toys starting with a kid-focused line in 2025.
