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Hasbro Hits Home Run For Q2 Revenue

The global play and entertainment conglomerate Hasbro, Inc. smashed its revenue targets for Q2, sending the company’s stock soaring.

“Hasbro delivered an excellent second quarter, with revenues up 54% versus the second quarter of last year and 9% versus pro forma second quarter 2019,” said Brian Goldner, Hasbro’s chairman and CEO.

This is the second reporting period since Hasbro restructured the company to streamline its various reporting segments. Pretty much all of Hasbro’s divisions were firing on all cylinders over the quarter, but revenue growth was again led by the Wizards of the Coast segment, which includes Magic: The Gathering and Dungeons & Dragons.

“Wizards continued to generate outstanding results behind a compelling analog and digital release schedule for Magic: The Gathering,” said Goldner. “Consumer products revenue increased as demand remains robust for Hasbro toys and games and entertainment revenue grew as we are producing entertainment with strong deliveries. The Hasbro team is performing at a high level and Supercharging our Brand Blueprint to drive demand for our brands and content slate as we track to our target of double-digit revenue growth for the full-year and position us for profitable growth not just this year but also in future years.”

Hasbro now reports its performance through three different segments, those being Consumer Products, Wizards of the Coast and Digital Gaming, and Entertainment. The restructuring was announced in February, and since then Hasbro has reported two very impressive quarters.

In Q2 the revenue from Consumer Products, which includes toys and games, did very well, growing by 33% over the same period last year. The Entertainment division, known as Entertainment One or ‘eOne’ did even better, rebounding by 47% after challenging revenue results in 2020 due to pandemic-related challenges around series and film production.

But it was the Wizards of the Coast segment that again showed the highest growth, and showed why Hasbro now functions as a play and entertainment company as opposed to a toy and games company. Wizards of the Coast, which also did very well in 2020, posted an astounding revenue increase of more than 200%.

“Strength across Hasbro’s brands and business backed by strong execution from the entire team drove superb results for our second quarter,” said Deborah Thomas, Hasbro’s chief financial officer. “As we invest to unlock value from our brands across the blueprint, we are on track to reach our objectives for the year while expanding the reach of our business, reducing debt and paying our dividend. The discipline in our business is evident from the $1.2 billion in cash we had on hand at quarter end, reporting the lowest days sales outstanding in our recent history, and repaying $250 million in debt.”

One aspect of the results included the revenues gained by Hasbro’s sale of its music business, which was originally acquired as part of the company’s purchase of Entertainment One. Music was not seen as a core part of the model, and the music portion of eOne was sold for a reported $397 million in Q3, 2020, but the revenues are being reported in Q2. That transaction has also allowed Hasbro to repay $250 million in debt at the end of Q2, and an additional $100 million at the beginning of Q3.

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