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Toy company Hasbro Inc. (NASDAQ: HAS) and Mattel Inc. (NASDAQ: MAT ) reported its fourth quarter 2022 earnings results recently. Both companies saw performance expectations as they battled a challenging consumer environment during the crucial holiday quarter. Here’s a look at his fortunes during that period:
results
Hasbro reported a profit of $1.68 billion for the fourth quarter of 2022, which is down 17% from the same period a year ago. Revenue was down 14% on a constant currency basis. Mattel’s net sales in Q4 2022 fell 22% year over year to $1.40 billion. Sales were down 19% in constant currency.
earnings
On a GAAP basis, in Q4 2022, Hasbro reported a net loss of $128.9 million, or $0.93 per share, compared to net income of $82.2 million, or $0.59 per share, last year. Adjusted EPS rose 8% to $1.31. Mattel saw GAAP net income fall 93% YoY to $16.1 million, or $0.04 per share. Adjusted EPS fell to $0.18 from $0.53 last year.
Category and brand performance
During the fourth quarter, Hasbro experienced a decline in profits in most major segments and the entire brand portfolio. The Consumer Products and Entertainment segment witnessed a double-digit decline in revenue while Wizards of the Coast and Digital Gaming experienced 22% revenue growth.
Revenue decreased across the brand portfolio with Partner Brands and Emerging Brands both down 30%. Franchise Brands and TV/Film/Entertainment saw revenues drop 12% and 13%, respectively, while Hasbro Gaming fell 8%.
In FY2023, Hasbro expects revenue to decline in the mid-single digits in Consumer Products and low-single digits in Entertainment. Wizards of the Coast and Digital Gaming are expected to see mid-single digit revenue growth for the year.
Mattel reported sales declines across all segments during the fourth quarter. Net sales in North America fell 26% while international sales fell 18%. Sales in the American Girl segment fell 17% in Q4. Gross receipts decreased for all Vehicle restriction categories, which reported a growth of 6%. Dolls, Infants, Toddlers and Preschoolers, and Action Figures, Building Sets, Games and Other Categories all recorded a double-digit decline in gross billings.
Outlook
For the full year of 2023, Hasbro projects revenue will fall by one digit less than the flat expected for the decline of the toy and game market. Adjusted EPS is expected to be between $4.45-4.55. Mattel expects net sales in FY2023 to be comparable to sales of $5.4 billion reported in FY2022. Adjusted EPS is estimated at $1.10-1.20 for the year.
Shares of Hasbro rose over 1% on Friday while shares of Mattel rose over 3%.
Click here to read the full transcript of Hasbro and Mattel’s Q4 2022 earnings conference call
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