Toy company Hasbro exceeded Wall Street’s expectations for the second quarter, driven by growth in its digital gaming segment. The company’s shares rose over 3% following the announcement.
For the quarter ending June 30, Hasbro reported adjusted earnings per share of $1.22, significantly higher than the anticipated 78 cents. Revenue reached $995 million, surpassing the expected $944 million. The company posted a net income of $138.5 million, or 99 cents per share, a notable improvement from the previous year’s net loss of $235 million, or $1.69 per share.
While Hasbro’s overall revenue dropped by 18%, the Wizards of the Coast and digital gaming segment experienced a 20% growth in revenue. This growth helped mitigate the 20% decline in consumer product revenue and a significant 90% drop in the entertainment segment, which was impacted by the sale of production studio eOne.
The revenue boost in the Wizards of the Coast and digital gaming segment was largely attributed to the successful launch of the Magic card game, Modern Horizons 3, and the continued popularity of digital games like Monopoly Go! and Baldur’s Gate 3. CEO Chris Cocks emphasized Hasbro’s commitment to expanding its digital gaming portfolio, noting the recent appointment of John Hight as president of Wizards of the Coast and digital gaming.
“With our recent strategic moves and the addition of key talent like John, we’re fully committed to evolving into a digital play company,” Cocks stated during the earnings call.
Looking ahead, Hasbro forecasts a further decline in revenue for the full year, with consumer product revenue expected to decrease by 7% to 11% and Wizards of the Coast revenue by 1% to 3%. The company projects an adjusted EBITDA of between $975 million and $1.025 billion for the year. Additionally, Hasbro aims to reduce costs by $750 million by the end of 2025.
