Hasbro Posts $129M Loss Amid Layoffs As It Looks for An Entertainment One Buyer
Toy giant Hasbro has swung to a fourth quarter loss on lower overall revenues for the holiday season and missed on Wall Street’s revenue and earnings expectations in a tough consumer environment.
On Thursday, Hasbro posted a loss of $129 million, against a year-earlier profit of $82.2 million, on revenues down 17 percent to $1.67 billion, which missed on a sales estimate of $1.72 billion, according to FactSet. The adjusted earnings per-share came to $1.31, which missed on an estimate of $1.33 a share.
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Rival Mattel also saw its sales and earnings fall in its most recent fourth quarter financials, which missed on Wall Street’s own expectations. During a morning analyst call, Hasbro gave an update on its sales process for non-core film and TV assets at Entertainment One as it looks to shrink its film and TV production footprint and focus on turning its own toylines into Hollywood franchises.
“Our sales process for the majority of eOne film and TV is well underway, with strong interest in these valuable assets. We expect to have an update in the second quarter,” Hasbro CEO Chris Cocks told analysts. On Jan. 26, the company said it would lay off 1,000 staffers, 15 percent of its workforce.
During the fourth quarter, film and TV revenue fell 10 percent to $310.6 million, reflecting lower film revenues from fewer new releases in 2022, against the year-earlier performance, and the timing of deliveries.
The unwinding of the company’s 2019 acquisition of eOne amid a strategic review of the overall toy making business includes the earlier sale of eOne Music and the exit from Secret Location, a virtual reality studio. Should a wider sale of select eOne assets come to pass, Hasbro will keep its family content business and like rival Mattel is expected to rely on production deals with studios and streamers.
And Hasbro will aim to develop and produce animation, digital shorts, scripted TV and theatrical films for fans of core Hasbro IP. The toy maker has in its release pipeline six movies — including Dungeons & Dragons: Honor Among Thieves hitting theaters in March — and a slate of TV series.
“We have a stacked lineup,” Cocks told analysts.
