Transcript
A (0:02)
Bloomberg Audio Studios Podcasts, radio news.
B (0:12)
Hasbro's turnaround is gaining momentum, powered by a surge in Magic the Gathering. Revenue from the popular card game more than doubled in the fourth quarter, boosted by its tie ins to other products such as Avatar, the Last Airbender and Final Fantasy as well. Strength in Hasbro's Wizards, Wizards of the coast and Digital Gaming Division, which holds Magic and D and D, helped lift overall sales 14%, underscoring what the CFO Gina Getter called a year of strong operational execution. Joining us now for more insights is Hasbro's CEO Chris Cox. And, and Chris, you're essentially, you know, the designer of this business as it, as it is structured right now. What do you make of the quarter? Give us your, your overview because it looks like Wizards is just absolutely crushing it.
A (1:06)
Well, we're really pleased with the quarterly results and I think it's beyond just Wizards. Our licensing business is up. Our toy business returned to growth, growing 7% in the quarter. And then of course, Wizards had just a remarkable quarter and a remarkable year sequentially just growing more and more as we went through the year. And we're seeing that momentum continue into this year. Think the year was really punctuated, as you kind of said in the lead up, by Magic the Gathering. You know, that business is over $1.7 billion now. It grew nearly 60% last year and that's on top of a kegger over the last 10 years of 16% per year. So I think it's a testament to a great team. I think it's a testament to a great game and a fantastic fandom.
C (1:54)
There has been some signs, not you necessarily, but Mattel earnings, retail sales, that there was weakness in December. I know when it comes to divisions, toys you have, which I'm sure one Matt Miller has already bought for his daughter's tie ups with things like K Pop, Demon Hunters. What did December look like specifically for that segment? Was there some weakness that we've seen elsewhere?
A (2:15)
Well, I think, I think for us what we saw was sequential improvement as we went through the holiday. We had a great Black Friday and Cyber Monday. There was a little bit of a dip in like the first and second week in December. But then the end of the month ended with a real bang, you know, for Hasbr, our toy division grew share, I think 18 of the last 20 weeks of the year. And I think that was on the strength of really good entertainment, really quality toys. We had a great year for Beyblade, Transformers, Marvel. Our Peppa Pig business returned to growth in the Back half. And then our board game business did pretty well. What I think maybe you're seeing across divergent results across different toy companies is really, you know, it's tough to say there's one toy market. I think it's a tale of two cities. I think the companies that are focused on gamified, entertainment driven, multi purchase, multigenerational play, something we call Gem Square, or a lot of people use shorthand for Kiddoz, they're really thriving. Their multiples are strong, 20 plus. Their growth rates are in the mid single digits to high single digits and they're growing with the growing marketplace. I think toy companies that are focused more on traditional toys, toys aimed at kids, kind of one offs, not truly systematized. You know, that's a, that's a hit driven business without a very strong moat. And I think you're seeing it in terms of what their multiples look like and contraction in that business, by the way.