Dive Brief:
- Hasbro’s Magic: The Gathering topped $600 million in quarterly revenue for the first time, according to a Tuesday press release from the company.
- Hasbro reported Q3 net sales of $1.5 billion, up 17.5% year over year. It marks the fourth consecutive quarter of double-digit revenue growth for the company.
- The company raised its full-year outlook and now expects revenue to be up between 7% and 9%, compared to the previous forecast of between 5% and 7%. “We’re entering the holidays with momentum,” CEO Chris Cocks said on a Tuesday call with analysts.
Dive Insight:
The third quarter was Hasbro’s strongest of the year, according to Gina Goetter, Hasbro’s chief financial officer and chief operating officer. Revenue, profit and cash flow came in ahead of the company’s expectations, giving Hasbro the confidence to raise its outlook.
On a Q3 earnings call, Cocks rattled off a list of high-performing metrics related to one of its cornerstone properties — Magic: The Gathering.
“What outperformed in Q3 for Magic? Everything,” Cocks said on the call.
For the quarter, Magic revenue was up 34% year over year. The company has seen new player growth and engagement, with the pre-release of The Hobbit set coming in as “one of the biggest we’ve ever had,” despite a smaller number of SKUs, Cocks said.
Meanwhile, starting in Q3, the company will break out and report its licensing revenue. “We believe that the added transparency provides better visibility into our primary revenue streams,” Goetter said.
Licensing revenue for the quarter was $144 million and is $417 million year to date. Licensing is asset-light and is a means of extending Hasbro’s brands through its partners, according to executives.
The company this year launched an AI studio, dubbed Sixth Wall, which introduced behavioral licensing. The IP licensing is focused on how characters think, speak and interact and gives creators, rights holders and Hasbro’s partners a way of bringing characters into new environments while preserving authenticity and commercial rights.
Hasbro announced last week that it is opening a studio in Montréal focused on Dungeons & Dragons.
