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Highlights
- Stock Surge: Hasbro shares jumped 14%, bringing year-to-date gains to nearly 25%.
- Revenue Growth Plan: The company aims for mid-single-digit annual revenue growth through 2027.
- Tariff Mitigation: Hasbro is reducing reliance on China and adjusting pricing to offset trade war risks.
Hasbro (NASDAQ:HAS) is forecasting a slight revenue increase in 2025 despite looming U.S. tariffs on Chinese imports, as the company implements a new strategy to drive sales. The announcement sent Hasbro’s stock soaring 14% during trading, with shares now up nearly 25% for the year.
The toymaker’s guidance accounts for potential duties on imports from China, Mexico, and Canada, but the company is taking steps to mitigate the impact. Hasbro, which previously warned that tariffs could force price hikes on some of its best-selling toys, is now working with suppliers and considering design changes to offset additional costs.
Reducing Dependence on China
As part of its long-term strategy, Hasbro is making a concerted effort to lessen its reliance on China, where about half of its U.S. toy and game volume is currently produced. The company aims to reduce that figure to below 40% within the next two years, Chief Financial Officer Gina Goetter told analysts.
While Hasbro does not import from Canada and has minimal sourcing from Mexico, it remains exposed to trade tensions with China. However, by shifting supply chains and adjusting pricing models, the company expects to weather the tariff uncertainty.
Growth Strategy and Licensing Expansion
Alongside its revenue outlook, Hasbro unveiled a strategic plan targeting mid-single-digit percentage growth annually through 2027. A key part of this initiative is expanding the company’s customer base by 50%, reaching over 750 million consumers.
Hasbro is leaning heavily on its iconic brands, such as Monopoly and Dungeons & Dragons, while also capitalizing on digital gaming and licensing—two sectors that have seen significant growth.
“Licensing is up big time,” Chief Executive Chris Cocks said, emphasizing its profitability and insulation from tariff-related disruptions.
The company’s plan includes $1 billion in cost savings over the next few years, with about half of that contributing directly to its bottom line.
Fourth-Quarter Performance and Market Response
Hasbro’s upbeat outlook accompanied its fourth-quarter earnings report, which showed a narrowed loss of $34.3 million (25 cents per share), compared to a $1.06 billion loss in the same period last year.
Excluding one-time items, adjusted earnings came in at 46 cents per share, beating analyst expectations of 34 cents, according to FactSet. Revenue fell 15% to $1.1 billion, but exceeded Wall Street’s estimate of $1.03 billion.
Much of the revenue decline was attributed to Hasbro’s divestiture of its eOne film and television business. Without that factor, revenue was down just 3%, with a slight dip in its Wizards of the Coast and digital gaming unit due to comparisons with the previous year’s successful Lord of the Rings holiday set.
