HASBRO, INC. Q4 FY2024 earnings call

• 2024 ended with strong momentum, achieving the best operating profit margin in company history over 20%. - Launched the 'Playing to Win' strategy focusing on play and partnerships, exiting non-core businesses and reducing content budgets. - Announced new partnerships, including with Mattel for Play-Doh Barbie and with Sabre Interactive for a new video game. - Wizards of the Coast and Digital Games had a record year, Consumer Products returned to profitability, and licensing business was a standout.

Wizards of the Coast and Digital Games segment saw 4% year-over-year revenue growth, with an operating margin north of 40%. Monopoly Go! contributed significantly, and Baldur’s Gate 3 sales nearly doubled initial expectations. Consumer Products segment declined 1% in Q4 and 12% for the full year, but had growth in brands like Beyblade, Furby, and My Little Pony. Entertainment segment revenue declined 88% due to the divestiture of eOne.

• 2025 total Hasbro revenue expected slightly up on constant currency basis. - Wizards revenue forecasted to grow 5%-7% driven by MAGIC's three Universes Beyond set releases. - Consumer Products revenue flat to down 4% with headwinds from NERF and Star Wars. - Adjusted EBITDA forecasted $1.1-$1.15 billion. - Target to reach $1 billion in cost savings by 2027.

• Potential impact of US tariffs on imports from China and other countries. - Uncertainty from government policy changes affecting the toy industry. - Flat growth expected in the toy industry over 2025-2027 and competition affecting market share.

Q: Megan Clapp asked about Consumer Products top line guide and industry POS.

A: Chris Cocks and Gina Goetter discussed the toy industry being flattish, trading cards and building blocks as drivers, and Hasbro's entertainment slate and price point innovation.

Q: Christopher Horvers asked about MAGIC launches and comparison to Lord of the Rings.

A: Chris Cocks mentioned Final Fantasy preorders sold out quickly, similar to Lord of the Rings but with Spider-Man set to do well.

Q: Eric Handler asked about medium-term guidance and video games.

A: Gina Goetter and Chris Cocks discussed balanced growth across business, video game releases cadence, and JV partnerships.

Q: Fred Wightman asked about margin offset and tariffs.

A: Gina Goetter explained capitalization impact on margins and tariffs baked into guidance.

Q: Arpiné Kocharyan asked about profitability and debt.

A: Gina Goetter discussed margin accretion, capitalization, and debt targets.

Q: James Hardiman asked about EBITDA and margin bridge.

A: Gina Goetter explained volume, mix, and supply chain impact on margins.

Q: Jaime Katz asked about cost savings and brand portfolio.

A: Gina Goetter discussed supply chain and design-to-value contributions to cost savings, and brand classification.

Q: Alex Perry asked about Monopoly Go! and Consumer Products POS.

A: Chris Cocks and Gina Goetter talked about Monopoly Go! revenue run rate and Q1 Consumer Products outlook.

Q: Stephen Laszczyk asked about margin swing factors and CapEx.

A: Gina Goetter discussed video game launch impact on margins and CapEx allocation.

Q: Kylie Cohu asked about margin drivers and inflation.

A: Gina Goetter explained toy profitability as key margin driver and inflation impact on costs.