PAWTUCKET – Hasbro Inc. on Thursday reported a $385.6 million profit for 2024 as it drastically cut costs and expenses, allowing the company to bounce back from a loss of $1.49 billion a year earlier.
The company also announced it is expanding its target savings goal from $750 million by the end of this year to $1 billion by 2027.
The news inspired investors on Wall Street. Hasbro closed trading up 12.95% at $60.96 per share.
For 2024, the company reported a profit of $2.75 per share, compared with a loss of $10.73 per share reported a year ago.
The improved bottom line was largely attributed to an 83% reduction in costs and expenses, which dropped from $6.5 billion in 2023 to $3.4 billion in 2024. A big portion of that cost reduction came because in 2023, Hasbro recorded a $1.2 billion "impairment of goodwill," meaning the value of past acquisitions had dropped and was reduced on its financial statements.
In 2024, Hasbro did not record an impairment.
Also in late 2023, Hasbro announced it would lay off an additional 1,100 employees globally, on top of 1,000 layoffs that had already been planned, as part of a company restructuring. the company also vacated its downtown Providence office building.
The decline in costs and expenses offset a 17.3% decline in revenue, from $5 billion in 2023 to $4.1 billion in 2024.
“We close 2024 with momentum, beating plans across the board,” Hasbro CEO Chris Cocks said to investors Thursday. “Our Wizards of the Coast and digital game segment had another record year. We saw strong growth across our licensing business, and we delivered the best operating profit margin in company history, eclipsing 20%, including a return to profitability for our consumer product segment.
“We began last year a healthier, stronger Hasbro, with an improved balance sheet and operating structure outlining plans for greater cost savings and reinvigorating the company's innovation engine," Cocks said. "We over-delivered, exceeding our guidance on nearly every metric, operating with renewed discipline that we believe positions [the company] for multiyear growth and margin expansion.”
On Thursday, the company did not offer any updates on the potential move of its corporate headquarters from Pawtucket to Boston.
Olivia DaRocha, a spokesperson for Gov. Daniel J. McKee, in a statement earlier this week said the governor has held several “productive meetings” with Cocks – most recently on Jan. 17 – and that discussions “are continuing.”
“We made a strong case to Hasbro highlighting the many reasons they should remain at home right here in Rhode Island,” she said.
Hasbro Chief Financial Officer Gina Goetter said during Thursday’s conference call with investors that the company’s guidance for 2025 includes the anticipated impact of U.S. tariffs and imports from China and reflects mitigating actions the company plans to take, including leveraging the strength of our supply chain and potential pricing.
“We continued to diversify our manufacturing footprint to create opportunities as we navigate the trade environment, and we are on a path to move from 50% of our US toy and game volume originating from China to under 40% over the next two years,” Goetter said. ”Really, it's a China story for us. We don't source from Canada. We have minimal sourcing coming out of Mexico. So we're really watching that China rate.”
During the call, Cocks also announced the company was increasing its target savings goal from $750 million by this year to $1 billion by 2027. However, Cocks did not specify nor offer details on how Hasbro plans to reach that savings goal.
"We are well on our way to achieving $1 billion in total annual growth savings by [2027], with 50% flowing to the bottom line,” Cocks said. “In 2025, we are projecting modest revenue growth coupled with continued margin expansion.”
Hasbro on Thursday also unveiled its “Playing to Win” strategic plan that will take the company into 2027. Hasbro said it seeks to expand its reach from over 500 million consumers to over 750 million in two years with an average of mid-single-digit revenue growth and 50-100 basis points of annual operating profit margin improvement.
"Through 2027, we were projecting a mid- single digit revenue ledger with continued operating profit improvement ... and major launches from our multiyear digital investments,” Cocks said. “When we play to win, we play to grow. In 2025, the first elements of our multiyear strategy will start to play out.”
The company on Thursday reported a fourth-quarter earnings loss of $34.3 million, after a $1.06 billion loss the year prior.
For the quarter, Hasbro posted a loss of 25 cents per diluted share compared with the $7.64 loss per diluted share the year prior.
Revenue for the quarter was $1.1 billion, a 14.5% decrease year over year, which beat Wall Street forecasts. Five analysts surveyed by Zacks Investment Research Inc. expected $1.03 billion.
Other earnings highlights, according to Hasbro:
- The company’s franchise brands generated $3.1 billion in revenue, a 4% decrease year over year.
- Partners brands revenue fell 15% from the previous year to $583 million.
- Portfolio brands revenue fell 17% to $431 million.
- Hasbro gaming revenue fell 1%, to $2 billion.
(UPDATES throughout with details on extended savings plan, reaction to tariffs and closing stock price. Material from The Associated Press was used in this report.)
