Toy and entertainment company Hasbro (NASDAQ:HAS) reported Q4 CY2025 results exceeding the market’s revenue expectations, with sales up 31.3% year on year to $1.45 billion. Its non-GAAP profit of $1.51 per share was 59.3% above analysts’ consensus estimates.
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Hasbro (HAS) Q4 CY2025 Highlights:
- Revenue: $1.45 billion vs analyst estimates of $1.26 billion (31.3% year-on-year growth, 14.4% beat)
- Adjusted EPS: $1.51 vs analyst estimates of $0.95 (59.3% beat)
- Adjusted EBITDA: $372.2 million vs analyst estimates of $267.2 million (25.7% margin, 39.3% beat)
- EBITDA guidance for the upcoming financial year 2026 is $1.43 billion at the midpoint, above analyst estimates of $1.31 billion
- Operating Margin: 20.6%, up from 5.4% in the same quarter last year
- Market Capitalization: $14.6 billion
StockStory’s Take
Hasbro’s fourth-quarter results were well received by the market, reflecting significant growth in both revenue and profitability. Management attributed the strong performance to the resurgence of its consumer products division, led by MONOPOLY, Peppa Pig, and Marvel, as well as remarkable momentum in its Wizards of the Coast segment. CEO Chris Cocks highlighted the success of Magic: The Gathering, noting that “Magic delivered a record fourth quarter,” and credited robust player growth and expanded distribution for the gains. Cost transformation initiatives and improved product mix also contributed to notable margin expansion.
Looking ahead, Hasbro’s guidance for the coming year is shaped by expectations for continued growth in Wizards of the Coast, a healthy entertainment pipeline, and ongoing cost savings initiatives. Management projects further operating leverage, supported by new partnerships and major entertainment releases. CFO Gina Goetter stated, “We expect operating margins to be between 24% to 25% for the year, reflecting continued operating leverage and disciplined execution.” Strategic investments in digital gaming and a planned rollout of high-profile licensed products are also set to play key roles in driving performance.
Key Insights from Management’s Remarks
Management pointed to brand reach expansion, robust gaming segment growth, and new licensing deals as the main drivers behind the quarter’s results and improving outlook.
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Wizards of the Coast’s standout growth: The Wizards segment, anchored by Magic: The Gathering, posted 86% revenue growth in the quarter, driven by strong set releases like Avatar the Last Airbender and Final Fantasy, as well as a 22% increase in organized play participants.
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Consumer products rebound: The consumer products division returned to growth, with Hasbro Gaming, Peppa Pig, and Marvel products performing particularly well. Improved product mix and promotional discipline were highlighted as contributors to margin improvement.
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Licensing partnerships accelerate: Hasbro secured major new licensing agreements, including Harry Potter with Warner Brothers Discovery and K-Pop Demon Hunters, and expanded collaborations with Disney, Amazon MGM Studios, and Legendary Pictures. These partnerships are expected to underpin future product launches and category expansions.
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Digital gaming and MONOPOLY GO: The MONOPOLY GO digital game remained a steady revenue and profit driver, with user acquisition costs moderating and engagement levels stable. Hasbro also previewed two upcoming self-published video games set for release in 2027.
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AI deployment in operations: Management discussed the rollout of artificial intelligence tools across financial planning, supply chain, and product design, resulting in process efficiencies and faster product development cycles. AI-driven workflows are anticipated to free up over one million hours for reinvestment in creative activities.
Drivers of Future Performance
Hasbro’s outlook is supported by new entertainment releases, continued gaming momentum, and operational efficiencies, but faces headwinds from royalties and tariffs.
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Magic: The Gathering ecosystem: Management expects mid-single-digit growth for Wizards, anchored by an expanded release schedule, strong player engagement, and new Universes Beyond collaborations with major franchises like Marvel and Teenage Mutant Ninja Turtles. Ongoing distribution growth and increasing organized play participation are seen as supporting this trajectory.
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Entertainment-driven product launches: The consumer products segment is set to benefit from a slate of major movie tie-ins, particularly with Disney, and new licensing partnerships. However, management noted that increased royalty costs and ongoing tariffs will act as headwinds for margin expansion in the near term.
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Cost savings and digital investment: Hasbro plans to achieve $150 million in additional gross cost savings through supply chain optimization and transformation initiatives, while reinvesting savings into digital gaming and product development. The company is also resuming share repurchases and maintaining its dividend, signaling a focus on capital discipline.
Catalysts in Upcoming Quarters
In coming quarters, our analysts will watch (1) the performance of new entertainment tie-ins and licensed products in consumer products, (2) the sustained player engagement and growth in Wizards of the Coast, and (3) the realization of cost savings from ongoing supply chain and operational initiatives. The pace of digital gaming expansion and the effectiveness of AI deployment in product development will also be important markers for Hasbro’s execution.
Hasbro currently trades at $102.11, up from $96.76 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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