Tuesday, October 23, 2018

Hasbro Report Confirms Setback in Toy Sector

Hasbro’s earnings report confirmed what industry analysts had been saying all along: toy manufacturers will lose sales because of the closing of Toys ‘R’ Us. The two largest U.S. toy manufacturers, Mattel and Hasbro, were disproportionately represented on the shelves at Toys ‘R’ Us, so they were expected to see a bigger immediate impact and to lose some sales permanently to other toy manufacturers with the loss of shelf space. There is nothing to indicate that the toy manufacturers are in any financial peril, however. They will be able to scale back production plans and carry on on a slightly smaller scale.

During the earnings call, Hasbro said there should be no long-term impact from Toys ‘R’ Us, but there is nothing to back up that assertion, while reports of layoffs imply that the company expects a permanent loss of a small fraction of sales.