Hasbro bounces back from underperformance

  • Ben Norman
  • July 23, 2018
  • 0

Featured image via Joint Base Langley-Eustis

Hasbro avoiding turning into a has-been?

Ever since Toys “R” Us closed, Hasbro has been struggling to generate sales and keep their profit margins up. However, in Q2 of this year, the toy manufacturer may have turned over a new leaf.

Sales were still down by 7 percent last quarter, but they still exceeded expectations by a significant amount. Because of this, Hasbro’s stock (HAS) jumped 13 percent on Monday following the news.

In fact, CEO Brian Goldner believes that by 2019, the company will be able to perform at the same level as had before Toys “R” Us went under. Hasbro has shifted its focus to Walmart, Amazon, and Target, which are all major movers of toys, especially with Toys “R” Us out of the industry.

Sales last quarter stem from the success of a few games, including board games like Monopoly and Magic: The Gathering, as well as toys like Marvel and Star Wars action figures. Plus, the company is making other moves like acquiring Power Rangers for $500 million a couple months ago.

Hasbro faces a couple of threats: the trade war with China and the growth of technology. First, the trade war has the potential to hurt sales. Although some toy production has been moved to the US to avoid steep tariff fees, China still accounts for two-thirds of Hasbro’s production, which adds up for the toy manufacturer. Secondly, as technology continues to advance, children become more enthralled by gadgets and less interested in traditional toys.

Nevertheless, Monday’s stock performance is a positive sign for Hasbro. If they can continue this growth, they could turn the company around, which had seen a 13 percent decrease in stock value over the past twelve months before Monday.

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: Hi, I'm Ben! Aside from BIZNOB, I have a passion for sports, music, reading, and photography. I love sharing my thoughts with the world, and I hope you enjoy what I have to say!