Hasbro’s third-quarter revenue performance fell short of Wall Street expectations and the company again cut its full-year revenue outlook, as signs of a potential industry slowdown in toy sales over the holiday season are troubling investors.
Thank you for reading this post, don't forget to subscribe!Holiday shopping is traditionally an important sales season for toy companies and can comprise a large portion of their annual toy sales. But there are concerns this year that some people may spend less on dolls, board games and other toys this season due to a decline in consumer spending due to inflation concerns.
Consumer confidence declined in September as Americans remain worried that interest rates will remain high for a long time.
For the quarter, Hasbro’s revenue fell from $1.68 billion to $1.5 billion. Analysts surveyed by Zacks Investment Research were expecting higher revenue of $1.64 billion.
The Pawtucket, Rhode Island-based company now estimates a 13% to 15% decline in full-year revenue, driven by a softer outlook for its consumer products division, which includes toys, games, clothing, music and other categories. Are. Its prior guidance was for a decline of 3% to 6%, which was an adjustment from the previous forecast of revenue coming in the low-single digits.
Shares fell more than 12% before markets opened on Thursday.
Hasbro reported a third-quarter loss of $171.1 million, or $1.23 per share.
Excluding one-time costs and amortization costs, earnings were $1.64 per share. This matched Wall Street’s view.
Rival Mattel Inc. had a better third quarter, reporting Wednesday that its sales rose 9% in the period. The company also raised its full-year adjusted profit outlook on the continued success of the “Barbie” movie.
Still, experts are calling the decline in toy industry sales so far this year and in the third quarter a cause for concern. Mattel Chairman and CEO Yoan Kreiz said during a conference call Wednesday that the company anticipates the global toy industry will experience a mid-single-digit decline in toy sales for the full year.
Mattel’s stock fell more than 12% in premarket trading.
Source: apnews.com
