Hasbro Q3 Revenue Slips But Company Still Expects Growth in Holiday Quarter

Hasbro shares saw a slight recovery on Tuesday after slipping on Monday when the toy maker reported its third quarter financial results.

The company revealed a 4% fall in adjusted revenue citing delays in movie and TV show productions that hit its entertainment unit. The coronavirus pandemic had led to a 28% fall in the company’s TV, film and entertainment business.

For the third quarter, Hasbro reported net revenue of $1.78 billion, which came head of analysts’ estimates of $1.75 billion, according to IBES data from Refinitiv.

Total revenue from all of Hasbro’s gaming brands including Monopoly, Scrabble and Dungeons & Dragons saw growth of 21% as more families played board games during the pandemic lockdowns.

On an adjusted basis, Hasbro posted earnings of $1.88 per share. This beat estimates of $1.63 per share.

The stock was down over 10% in afternoon trading on Monday as Wall Street digested the numbers.

Hasbro has also warned that it does not have a major release of a kid’s movie this holiday season to boost toy sales. Fortunately the company has said it still expects adjusted sales and earnings to rise for the holiday quarter.

It was last week that rival toy maker Mattel had posted net sales growth of almost 10% for the third quarter. Mattel also beat net revenue estimates by nearly $200 million.

According to analysts at MKM Partners, some of the drop in Hasbro shares were due to heightened expectations after Mattel trounced sales and profit forecasts on strong demand for its Barbie line of dolls.

Brian Goldner, Chairman and Chief Executive Officer of Hasbro said on the earnings call, “The global Hasbro team did an excellent job delivering a strong third quarter, with revenues growth in toys, games, and digital initiatives while live-action production begins to return. Consumer demand remains strong.”

He added, “Hasbro lines sold very well during this period. Our teams are working in concert with our retailers to drive and fulfill demand this holiday season. They are doing an excellent job managing this dynamic environment, driving the business forward for this year and beyond. Importantly, they have positioned us for what we believe should be a good holiday season for Hasbro.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.