Hasbro, the popular toy company, exceeded Wall Street’s expectations for the second quarter of the year, thanks in part to growth in its digital gaming segment. The company’s shares saw a significant jump of more than 3% in afternoon trading.
In terms of earnings per share, Hasbro reported $1.22 adjusted, surpassing the expected 78 cents. Its revenue for the quarter reached $995 million, beating the anticipated $944 million. This strong performance is a stark contrast to the same quarter last year when Hasbro reported a net loss of $235 million.
While overall revenue declined by 18% for the quarter, the company’s Wizards of the Coast and digital gaming segment experienced a remarkable 20% growth in revenue. This growth partially offset the 20% drop in consumer product revenue and the 90% decline in the entertainment segment due to the divestiture of production studio eOne.
Hasbro attributed the revenue increase in its digital gaming segment to the successful launch of Magic’s card game, Modern Horizons 3, as well as the continued impact of licensed and digital gaming. Monopoly Go! and Baldur’s Gate 3 were also mentioned as top performers in this segment.
CEO Chris Cocks emphasized the company’s commitment to investing in its digital gaming portfolio, highlighting the recent appointment of John Hight as president of Wizards of the Coast and digital gaming. Cocks stated, “we’re going all in on becoming a digital play company.”
Despite the positive second-quarter results, Hasbro anticipates further revenue declines for the full year. Consumer product revenue is projected to be down 7% to 11%, while Wizards of the Coast revenue is expected to decrease by 1% to 3%. However, the company is taking measures to reduce costs and expects to cut expenses by $750 million by the end of 2025.
In conclusion, Hasbro’s strong performance in the second quarter, particularly in its digital gaming segment, has exceeded expectations. The company’s focus on digital gaming and its strategic appointments demonstrate its commitment to becoming a leading player in the digital gaming industry. While revenue declines are expected for the full year, Hasbro is taking steps to optimize its operations and reduce costs, positioning itself for long-term success.
