The Hasbro Q3 2023 earnings call yielded some interesting facts. But the most surprising is that Hasbro stock is at its lowest point of the past seven months. This is despite WotC’s high-profile brands Dungeons & Dragons and Magic: The Gathering clocking in $120 million higher revenues than in the same period in 2022.
In August 2023, Bank of America raised the buy rating of Hasbro Inc. (NASDAQ: HAS), boosting the company’s S&P 500 profile at the time. This was largely due to the revenue being generated by Hasbro’s subsidiary, Wizards of the Coast and its top franchises, Dungeons & Dragons and Magic: The Gathering.
News; $HAS Hasbro (HAS) Q3 2023 Earnings Call Transcript https://t.co/AzvvgTzJQ1
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With the 2023 Q3 investor conference call, Hasbro reported how well the Wizards of the Coast brands performed.
Although the live-action Dungeons & Dragons: Honor Among Thieves movie had a mediocre performance, the D&D brand name received a huge windfall thanks to the hit CRPG collaboration with Larian Studios, Baldur’s Gate 3. Specifically, the Q3 Hasbro revenue call cited WotC’s Digital Gaming Segment seeing an overall revenue increase of 40% and over 100% increase in Digital and Licensed Gaming revenue.
Meanwhile, Magic: The Gathering led the tabletop revenue increase of 18%. This was attributed to solid sales numbers of the Wilds of Eldraine expansion, as well as the massively popular Universes Beyond crossovers and the popularity of the digital Magic: The Gathering Arena. The Lord of the Rings: Tales of Middle-earth sets were specifically mentioned as a benchmark for the tabletop division. Certainly, The One Ring limited edition MTG card that rap artist Post Malone bought for $2 million helped raise the hype.
To a lesser extent, Monopoly Go was also mentioned in the Hasbro Q3 earnings call as a top performer. This digital version of the classic board game has been a solid source of Hasbro’s company revenue since it debuted on mobile devices in April of this year.
But while Wizards of the Coast has been nothing but green for Hasbro’s profit, the rest of the parent company’s other product lines are not doing so well. The noted contributors to the decline in profit include the Hasbro Entertainment Segment (down by 42%), Consumer Product revenue decrease of 18% due to “exited licenses and softer category trends”.
Related to this, October saw Hasbro stock prices spiral downward from a high of $64.28 to $45.04 by October 30th.
Can things turn around for Hasbro in the remaining months of 2023? There is potential for the company to bounce back, as the holiday seasons arrive. Thanksgiving and Christmas will generally see increased sales numbers for Hasbro’s consumer products such as toys. Plus, the sale of the eOne Film and TV division is projected to be finalized before the year ends.
And as for 2024, Wizards of the Coast is expected to have a big year ahead. Aside from celebrating 50 years of Dungeons & Dragons (and a new edition of the most popular tabletop roleplaying game in the works), Magic: The Gathering Universes Beyond crossovers with Assassin’s Creed and Fallout are also scheduled for next year.
