Spin Master Corp., the company behind PAW Patrol and Hatchimals, revealed its second quarter earnings today. Alongside the Q2 earnings report comes news that Executive Vice President and Chief Financial Officer Mark Segal will retire next year.
In Q2, revenue was $412 million, a decrease of 2.1% versus Q2 last year. The numbers include $43.3 million in revenue from Melissa & Doug. Entertainment revenue spiked 7.4% while Toys dipped 1.6% followed by a 14.3% slide in Digital Games.
According to Spin Master Global President and CEO Max Rangel, the results for the quarter were in line with expectations due to increased pressure on consumer spending and a pull-back in in-game spending for Digital Games.
Looking ahead to the balance of 2024, our team is focused on delivering our signature breakthrough innovation in toys and launching new properties, including Ms. Rachel, delivering entertainment that resonates with audiences on a global scale, such as Unicorn Academy, and releasing new experiences in digital games, such as Rubik's Match, designed to expand our player ecosystem. We believe in Spin Master's long-term growth potential driven by our diversified portfolio of innovative toys, engaging entertainment and open-ended digital games. With these compelling capabilities, we believe we will deliver our longer-term strategic and financial goals."
For the first six months of 2024, Spin Master revenue was $728.2 million, including Melissa & Doug Revenue of $83.7 million, an increase of 5.2% from $692.1 million. Revenue, excluding Melissa & Doug was $644.5 million, a decrease of 6.9% from $692.1 million last year.
Looking deeper into the numbers in the Toys segment, gross product sales in Preschool, Infant & Toddler and Plush was up 0.1% while Activities, Games & Puzzles and Dolls & Interactive spiked 17.9%. Sales of Outdoor Toys were up 2.8% while Wheels & Action fell off a cliff with a 25.1% decline.
Toy Gross Product Sales were $384.7 million, including Melissa & Doug Toy gross product sales of $51.7 million, a decline of $5.3 million or 1.4% from $390 million last year. Toys gross product sales, excluding Melissa & Doug were $333.0 million, a decrease of $57.0 million or 14.6% from $390 million in Q2 last year.
Segal will exit his post in the first half of 2025. A search for a successor is underway.
“Spin Master is a remarkable Canadian and global success story fueled by passion, entrepreneurship and innovation and it’s been my privilege to have contributed to the company’s evolution and growth journey,” Segal says. “I’m extremely proud of what we have accomplished together and look forward to continuing to contribute in an advisory capacity.”
The company will address industry analysts on an earnings call tomorrow morning.
