(Reuters) – Hasbro Inc topped Wall Street expectations for quarterly revenue on Thursday, boosted by strong growth in the company’s digital gaming segment at a time when demand for its toys has taken a hit from a drop in consumer discretionary spending.
Following bumper revenue growth during the peak of the pandemic, U.S. toymakers are seeing a slowdown in demand while retailers are also cutting down on toy orders under the weight of inflation and worries of a recession.
While demand for Hasbro’s NERF blasters, Play-Doh and Peppa Pig toys fell in the first quarter, the company saw strong fan engagement in its Wizards of the Coast and Digital Gaming segment, with revenue from its “Magic: The Gathering” card game up 16%.
Rival Mattel Inc on Wednesday posted a bigger-than-expected quarterly loss, pinched by retailers trimming orders, but maintained its annual forecasts betting that its retail customers will work through inventory issues by the end of the current quarter.
Hasbro reported net revenues of $1.00 billion in the first quarter, compared with $1.16 billion a year earlier. Analysts had expected revenue of $878.4 million, according to Refinitiv IBES data.
Monopoly maker Hasbro, which maintained its annual sales and earnings forecasts, reported a net loss of $22.1 million, or 16 cents per share, in the quarter, compared with a profit of $61.2 million, or 44 cents per share a year earlier.
(Reporting by Deborah Sophia in Bengaluru; Editing by Shounak Dasgupta)
