If you’re going to play, play to win, and Hasbro is proving it means business.
Following the debut of its refreshed strategic vision ahead of Toy Fair, Hasbro charged into 2025 with strong first-quarter earnings that beat expectations, delivering a much-needed boost of positivity and confidence beyond the walls of Hasbro HQ and throughout the greater toy industry. With new products hitting key price points — $9.99 and $19.99 — a diversified supply chain in place, and momentum in its games and licensing portfolio, Hasbro is positioning itself for long-term resilience, even amid global uncertainties.
To unpack the Q1 results, The Toy Book caught up with Hasbro CEO Chris Cocks following this morning’s earnings call for additional insights.
The Toy Book: Amid a great start to the year, what was the biggest surprise in Q1?
Chris Cocks: We expected Magic: The Gathering to be strong, but it’s really strong. There’s something going on in the gaming and trading card space that feels generational. I think many kids of the ’90s who grew up playing Magic are now in their peak collector years, while new players are joining the game.
TB: On today’s call, you mentioned discussing tariff and supply chain issues with retail partners. Mass retail manages the current environment better than specialty retailers, such as independent toy stores, game shops, and the “fan channel” collector shops. How is Hasbro supporting the smaller retailers?
CC: We continue to support specialty retailers through initiatives like our Wizards Play Network, which is up to 7,500 stores now. The game side is super healthy, and Magic: The Gathering and Dungeons & Dragons are not sourced from China, so there isn’t tariff exposure.
We have 93 days of inventory to allocate to support mass retailers and mom-and-pop shops. We have uniform pricing for 60-90 days, so retailers have time to prepare for any pricing updates. And, we’re going to maintain our pricing as long as possible.
There is a downside for the toy industry in that there will be some blanks in planograms later this year, and because of that, we can step in and ask our retail partners, “How can we help?” We have a lot of products in our board game and TCG business with little to no tariff exposure. This is an opportunity for Hasbro, but a loss for the toy aisle if products are missing.
TB: How is the inventory channel looking today? We’d spoken about some of the overstocks from the last supply chain crisis that were getting cleaned up along with the SKU reduction last year.
CC: Inventory channels are super clean, and we have reduced the SKUs. It’s important to note that when we say that we’ve reduced SKUs by 80%, that doesn’t mean that there are 80% fewer items to buy — the reduction is in complexity from offering a 5-pack of something to a 4-pack. We did have a slight inventory surge from Q4 of last year because we brought some items in early ahead of any tariffs.
TB: Regarding tariffs, you mentioned planning for multiple outcomes, including sticking with a 145% duty on China and a 10% duty elsewhere. How could that impact consumer pricing across categories, from simple toys to the more complex, articulated offerings out of China, such as the collector lines and Hasbro Pulse products?
CC: With pricing category by category, mileage varies. For collectors, we get that a $40-50 action figure is a purchase from the heart. We’re not looking to nickel and dime anyone there. There will be no increase in the current preorder pricing for items that were ordered before the 145% kicked in. The price that was paid is the price.
When considering relocating production on items with a lot of deco or detail, including action figures and some of our role-play items, we will not cut corners. We will always choose the right manufacturing partner to ensure safety and quality. Then, we’ll look at the tariffs for pricing considerations.
Looking ahead:
Hasbro expects another big win in June with Magic: The Gathering – Final Fantasy debuting on day one as the best-selling Magic card set ever. The company also re-upped its licensing deal with Disney to produce new toys for its Lucasfilm and Marvel projects, including blockbuster films such as Avengers: Doomsday and Star Wars: The Mandalorian and Grogu.
In terms of global trade, Hasbro maintains that China will remain an important partner in supplying new products to kids and collectors worldwide, even as it continues to reevaluate and diversify production and logistics.
At the close of our call today, Cocks reiterated something he said at the start of this morning’s call with analysts — that Hasbro is appreciative and supportive The Toy Association and its advocacy efforts in Washington D.C. to keep toys tariff-free.
“We believe there should be free and fair trade for toys — an industry critical not only to hundreds of thousands of American jobs but also to the joy and developmental well-being of millions of children, families, and fans across the U.S. and worldwide,” he says.
Should the tariffs of 50% to 145% remain in effect for China, Hasbro stands to lose $100-300 million before any mitigation. The company could shrink that number to $60-180 million with targeted pricing actions. For now, the situation remains fluid, though Hasbro expects a reasonable trade policy to emerge.
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