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HASBRO, INC. (HAS)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 revenue $980.8M (-1% Y/Y) and adjusted EPS $1.30; both beat Street as revenue exceeded consensus by $98.6M and EPS by $0.53, driven by record MAGIC: THE GATHERING “Final Fantasy” and stronger licensing/digital contributions. Consensus values marked with * from S&P Global .
  • Wizards of the Coast and Digital Gaming revenue rose 16% Y/Y to $522.4M with operating margin 46.3%; Consumer Products fell 16% amid retailer order timing and tariffs, and recorded a $1.022B non-cash goodwill impairment, driving GAAP EPS to -$6.10 .
  • Hasbro raised FY25 guidance: revenue up mid-single digits (prior: up slightly), adjusted operating margin 22–23% (prior: 21–22%), and adjusted EBITDA $1.17–$1.20B (prior: $1.10–$1.15B), citing Wizards strength and cost productivity .
  • Call catalysts: management highlighted record “Final Fantasy,” stronger backlist/Secret Lair, and a healthier tariff backdrop with expected 2025 P&L impact near $60M, plus segment guidance lifting Wizards (high-20% revenue growth; 42–43% margin) while CP declines 5–8% with 4–6% margin .

What Went Well and What Went Wrong

What Went Well

  • MAGIC: THE GATHERING revenue grew 23% Y/Y; “Final Fantasy” is the biggest Magic set ever. CEO: “record-setting results from MAGIC: THE GATHERING…we’re increasing our full-year outlook” . CFO: “Final Fantasy became the biggest Magic set in our history,” with agile production (four pre-release increases) .
  • Guidance raised on strength in Wizards and cost discipline: “We are raising our full-year revenue and adjusted EBITDA guidance” ; updated outlook: revenue up mid-single digits; adjusted op margin 22–23%; adjusted EBITDA $1.17–$1.20B .
  • Licensing/digital momentum: Monopoly Go! contributed $44M in Q2 (with H2 cadence guided to ~$12–$14M/month) and a new multi-party casino gaming deal expands high-margin brand monetization .

What Went Wrong

  • Consumer Products segment revenue fell 16% Y/Y; North America -23% Y/Y; retailers delayed direct imports and holiday shelf resets, pressuring Q2 revenue and creating deleverage .
  • Goodwill impairment: $1,021.9M non-cash charge in CP (tariff-triggered), producing GAAP operating loss and GAAP diluted EPS of -$6.10 despite solid adjusted results .
  • Wizards margin down 8.4 pts Y/Y to 46.3% on higher royalty expense, even as segment revenue rose 16% .

Financial Results

Headline Metrics Across Recent Quarters (oldest → newest)

MetricQ4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$1,101.6 $887.1 $980.8
GAAP Diluted EPS ($)-$0.25 $0.70 -$6.10
Adjusted Diluted EPS ($)$0.46 $1.04 $1.30
Adjusted Operating Margin (%)10.2% 25.1% 25.2%

Q2 2025 vs Prior Year and vs Street

MetricQ2 2024Q2 2025 ActualStreet Consensus*Surprise
Revenue ($USD Millions)$995.3 $980.8 $882.3*+$98.6M (Beat)
Adjusted Diluted EPS ($)$1.22 $1.30 $0.77*+$0.53 (Beat)

Consensus estimates marked with * retrieved from S&P Global.

Segment Breakdown (Revenue and Adjusted Operating Profit)

SegmentQ4 2024 Revenue ($M)Q1 2025 Revenue ($M)Q2 2025 Revenue ($M)
Wizards of the Coast & Digital Gaming$339.0 $462.1 $522.4
Consumer Products$746.3 $398.3 $442.4
Entertainment$16.3 $26.7 $16.0
SegmentQ4 2024 Adjusted Op Profit ($M)Q1 2025 Adjusted Op Profit ($M)Q2 2025 Adjusted Op Profit ($M)
Wizards of the Coast & Digital Gaming$80.9 $230.0 $241.8
Consumer Products$59.6 -$31.0 $1.2
Entertainment$0.2 $17.4 $10.1
Corporate & Other-$28.0 $6.0 -$6.0
Total Adjusted Op Profit$112.7 $222.4 $247.1

KPIs

KPIQ4 2024Q1 2025Q2 2025
MAGIC: THE GATHERING Revenue ($M)$208.4 $346.3 $412.0
Hasbro Total Gaming Revenue ($M)$542.5 $550.1 $615.8
Monopoly Go! Contribution ($M)—$39 $44
Wizards Tabletop Gaming Revenue ($M)$207.0 $343.8 $406.3
Wizards Digital & Licensed Gaming Revenue ($M)$132.0 $118.3 $116.1

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total Revenue (cc)FY25Up slightly Up mid-single digits Raised
Adjusted Operating Margin (%)FY2521–22% 22–23% Raised
Adjusted EBITDA ($B)FY25$1.10–$1.15 $1.17–$1.20 Raised
Wizards Revenue Growth (%)FY25n/aHigh-20% range New
Wizards Op Margin (%)FY25n/a42–43% New
Consumer Products Revenue Growth (%)FY25Flat to down 4% (implied prior context) Down 5–8% Lowered
Consumer Products Adjusted Op Margin (%)FY256.0% FY24 actual baseline 4–6% Maintained to lower
Gross Cost Savings ($M)FY25n/a$175–$225 New
Tariff Expense ($M)FY25Broad range modeled $60–$180 (Apr commentary) ~$60 (lower end) Narrowed/lower
Dividend per Share ($)Q3 2025$0.70 (prior cadence) $0.70 (declared payable Sep 3, 2025) Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
AI/technology & digital pipelineStrategy reset and 2025 guidance; digital/licensing supported WotC margins in 2024 Exodus AAA RPG targeting H2 CY2026; new D&D AAA single-player with Giant Skull (UE5) Pipeline expanding; medium-term spend ahead
Supply chain & tariffs2025 guidance contemplated tariffs; supply chain productivity improved in 2024 Tariff impact expected ~$60M; minimal YTD P&L flow-through; DI→DOM shift; diversification and some onshoring (East Long Meadow) Headwind emerging in H2; mitigation active
Product performance (Magic, licensing)Magic down in Q4 due to LOTR lap; Monopoly Go $112M FY24 Magic +23% Y/Y; record “Final Fantasy”; Secret Lair strongest quarter; Monopoly Go $44M Q2 and guided $12–$14M/month H2 Strong acceleration continuing
Regional trends (CP)Q4 CP NA +2% Y/Y; Europe -10%, APAC +44% Q1 CP NA -3% Y/Y; Q2 CP NA -23% Y/Y; LATAM -26% Y/Y North America weaker; Europe/APAC modest growth
Retailer behavior—Retailers delayed holiday resets into Q3 and slowed direct imports; inventory caution Cautious ordering; later pull-in
Cost programs2024 gross savings $370M; net $227M FY25 gross savings on track; $98M H1 delivered; target $175–$225M Execution ongoing

Management Commentary

  • CEO: “Hasbro’s return to growth in the first half of 2025 is clear validation that our Playing to Win strategy is working…we’re increasing our full-year outlook” .
  • CFO/COO: “We are raising our full-year revenue and adjusted EBITDA guidance, fueled by performance in our Wizards business” .
  • CEO on Magic: “Final Fantasy…already the highest-grossing Magic set ever…Secret Lair…strongest sales quarter in its history” .
  • CFO on tariffs and mitigation: “We are…estimating we’ll be at the lower end of the range and expect $60 million of expense in our 2025 P&L…activated a comprehensive mitigation playbook…SKU rationalization, sourcing diversification, pricing strategy” .

Q&A Highlights

  • “Final Fantasy” demand far exceeded expectations; production increased four times pre-release and left demand on the table—supporting a long tail and backlist strength .
  • Monopoly Go! user metrics exceeded industry benchmarks; revenue cadence guided to ~$12–$14M/month in H2 (vs ~$14M/month H1), lifting licensing contribution .
  • CP outlook calibrated for delayed holiday resets and DI→DOM shift; Q2 revenue loss seen as sticky, with deleverage impacts into H2 .
  • Wizards margins expected to normalize sub-40% post-2026 as Exodus depreciation ramps; near-term margins guided at 42–43% for 2025 .
  • Inventory elevated seasonally and due to tariffs/FX and DOM builds; ~$15M tariff cost sits in balance sheet at Q2, with flow-through in H2 .

Estimates Context

Hasbro beat Street EPS and revenue estimates the last three quarters, with widening beats in 2025 driven by Wizards.

MetricQ4 2024 Consensus*Q4 2024 ActualQ1 2025 Consensus*Q1 2025 ActualQ2 2025 Consensus*Q2 2025 Actual
Primary EPS Consensus Mean ($)0.346*0.46 0.674*1.04 0.771*1.30
Revenue Consensus Mean ($M)1,024.9*1,101.6 770.6*887.1 882.3*980.8

Consensus estimates marked with * retrieved from S&P Global.

Where estimates may need to adjust:

  • Wizards growth and Magic pipeline support higher H2 revenue and margin assumptions; CP margin trajectory should reflect tariff flow-through and retailer timing impacts .

Key Takeaways for Investors

  • Raised FY25 guide (revenue up mid-single digits; adjusted operating margin 22–23%; adjusted EBITDA $1.17–$1.20B) signals confidence in Wizards/digital/licensing momentum—supporting estimate revisions and potential multiple expansion .
  • Q2 beat was quality-driven: Magic +23% Y/Y, Secret Lair/backlist records, and Monopoly Go licensing strength; watch for sustained backlist tail and Universes Beyond slate (Spider‑Man, Avatar) .
  • CP weakness is largely timing/tariff-driven; H2 set-ups later and inventory cautious—expect sequential improvement but margin drag from tariffs (~$60M FY) .
  • Non-GAAP vs GAAP divergence underscores impairment impact (tariff-triggered $1.022B goodwill charge); focus on adjusted profitability and cash generation (H1 CFO $209M; dividends $98M Q2) .
  • Segment guidance: Wizards high-20% revenue growth with 42–43% margin in FY25; CP down 5–8% with 4–6% margin—tilt exposure to Wizards/digital/licensing .
  • Near-term trading: positive catalyst path via back-half Magic releases and licensing cadence (Monopoly Go ~$12–$14M/month); CP holiday execution and tariff price elasticity are swing factors .
  • Medium-term thesis: expanding digital slate (Exodus H2 CY2026; D&D AAA) and supply-chain diversification/onshoring enhance resilience while cost program ($175–$225M FY25 gross) drives structural margin lift .