FIILE PHOTO: A Monopoly board game by Hasbro Gaming is seen in this illustration photo August 13, 2017. REUTERS/Thomas White/Illustration
Hasbro Inc (HAS.O) sailed past first-quarter profit estimates on Tuesday as a boost from its main Nerf toys and “Magic: The Gathering” businesses and lower advertising expenses countered a lackluster show in its movie and TV production unit.
The company reported a 14% rise in sales in its consumer products unit, as families spent more on Nerf blasters and Play-Doh to keep children entertained while stuck at home.
Advertising costs fell 13.6% in the quarter as the company pulled back on film and TV promotions after COVID-19 disrupted studio production schedules and forced theater closures.
Hasbro has in recent years focused on entertainment production to power growth at a faster pace than traditional toy sales but the pandemic laid bare the risk of that strategy, with revenue tumbling 34% fall in the TV, film and entertainment business.
“Snake Eyes” a film based on the character from Hasbro’s popular “G.I.Joe” franchise, initially scheduled to release in 2020 has been delayed to later this year. Entertainment One, the firm behind Peppa Pig and “The Walking Dead” TV series, which Hasbro bought in 2019 also came under pressure last year.
Shares of the toymaker, which late on Monday announced the sale of Entertainment One Music to Blackstone Group Inc (BX.N) for $385 million, were flat after rising as much as 2% in trading before the bell.
The Monopoly maker’s net revenue rose 1% to $1.11 billion in the three months ended March 28, but missed analysts’ estimates of $1.17 billion, according to a Refinitiv IBES estimate.
Rival Mattel Inc (MAT.O), which still relies more heavily on traditional toy sales, reported a record rise in quarterly sales last week, handily beating estimates. read more
Excluding certain items, Hasbro earned $1 per share, above analysts’ estimates of 65 cents per share.
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