Hasbro Slashes Nearly 20% of Workforce amid Sluggish Holiday Sales
In a stark blow, toy juggernaut Hasbro is chopping close to 20% of its workforce. This decision comes in the wake of disappointing holiday sales that failed to meet expectations. In an email to staff, company CEO Chris Cocks revealed that these "headwinds" would linger until 2024.
Out of the 1100 positions scheduled for elimination, 200 are holdovers from the initial 1000 job cuts announced at the start of the year.
Hasbro's diverse product lineup includes beloved brands such as Play-Doh, board games like Monopoly, and figures like My Little Pony and Transformers. The company, like its rival Mattel, is grappling with falling toy expenditures post-pandemic and a growing fascination among children towards digital entertainment. Mattel made waves this year with the blockbuster "Barbie" movie, which catalyzed a surge in doll sales.
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Hasbro's persistent challenges include a decline in toy expenditures, a shift in children's interests towards digital entertainment, and the company's inability to fully capitalize on the holiday sales boost. The "headwinds" plaguing Hasbro's sales are expected to persist until 2024, resulting in a significant workforce reduction.
Insider Information:
In an attempt to inch back towards profitability, Hasbro has adopted a game-centric strategy. The gaming sector now accounts for a substantial portion of the company's revenue (around 50%) with impressive operating margins of 41.8% in 2024. This shift includes a strong focus on digital gaming, and Hasbro has recently made impressive strides in this area.
To highlight this, the company released highly successful digital games like Baldur's Gate 3 and has plans for future releases, such as the sci-fi videogame "Exodus," slated for 2026. Hasbro is also tightening its belt in terms of cost-saving measures, particularly by reducing unsold inventory. By streamlining its operations and focusing on its digital gaming expansion, Hasbro is pushing forward to navigate the challenges it faces.
