PAWTUCKET – Hasbro Inc. on Thursday reported a loss of $171 million in the third quarter of 2023, following a year-ago profit of $129.2 million.
That amounts to a $1.23 loss per diluted share. In the same period in 2022, Hasbro made a profit of 93 cents per diluted share.
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“Our third quarter results highlight the strength of Hasbro’s diversified toy and game portfolio and the progress we have made on our transformation,” said Chris Cocks, Hasbro CEO. “Building on the strategy we outlined a year ago, we’re growing share behind our Franchise Brands in core categories, driving savings and investment capacity through operational excellence and building new growth for the company across games, direct to consumer and licensing.”
For the quarter, Hasbro’s revenue totaled $1.5 billion, a 10% drop year over year, missing Wall Street’s expectations. Analysts polled by Zacks Investment Research were looking for higher revenue of $1.64 billion. The company cut its full-year revenue outlook again as signs of a possible industry slowdown in toy sales heading into the holiday season weigh on jittery investors.
“We believe in the long-term growth potential of toys and are leaning in,” Cocks said. “Our plan for Q4 is to drive share over the holiday, exit the year with clean inventory, a much-improved corporate overhead, and a clear runway for introducing new product innovation and go to market support in the quarters ahead.
“Although the impact of the broader toy category declines has changed our consumer products and total Hasbro outlook, we are growing share in the categories where we compete and beginning to see the benefits of our cost savings initiatives play through the P&L,” he added. “Resetting our cost base and removing complexity will help ensure we are well-positioned as we sharpen our innovation pipeline for 2024 and 2025.”
The company now foresees full-year revenue falling 13% to 15%, driven by a softer toy outlook for its consumer products division, which includes toys, games, clothing, music and other categories. Its prior guidance was for a decline of 3% to 6%, which was an adjustment from a previous forecast for revenue to be down low-single digits.
- The company’s franchise brands portfolio, including Magic the Gathering, Play-Doh and Nerf, logged revenue of $1.01 billion in the third quarter, an increase of 8% year over year. The company noted top brand performances included Dungeons & Dragos, Magic: The Gathering, Hasbro gaming and Transformer products.
- Partner brands portfolio revenue, including products for Star Wars, Marvel’s Spider Man and Marvel Studios content, totaled $228 million in the third quarter, a decline of 35% year over year. The portfolio was led by the Spider-Man franchise, including products in support of Marvel Studios’ “Spider-Man: No Way Home” and the new animated show Marvel’s “Spidey and His Amazing Friends,” plus Avengers franchise support with the upcoming Marvel Studios’ “Doctor Strange in the Multiverse of Madness.”
- Wizards of the Coast and digital gaming revenue increased 39.5% year over year in the third quarter to $423 million.
- TV/film/entertainment revenue totaled $122.9 million in the third quarter, a decrease from $211.6 million a year ago. That decline was attributed to writers’ and actors’ strikes.
Rival Mattel Inc. had a better third quarter, reporting on Wednesday that its sales rose 9% in the period. The company also boosted its full-year adjusted profit outlook on the continued benefit of the success of the “Barbie ” movie.
(Material from The Associated Press was used in this report.)
