Hasbro (HAS) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue declined 15% year-over-year to $1.28B, mainly due to the eOne Film and TV divestiture and industry headwinds, but profitability improved on strong performance in games and licensing, cost savings, and operational discipline.

• Adjusted operating profit was $329M (25.7% margin), up 2.9 points year-over-year, with net earnings of $223M (reported) and $244M (adjusted); adjusted EPS was $1.73, up $0.09 from last year.

• Strategic focus on core brands, digital, and IP licensing, with Magic: The Gathering and D&D outperforming expectations and new product innovation supporting future growth.

• Inventory levels are at multi-year lows, down 39–40% year-over-year, and cost savings reached $87M in Q3 and $177M year-to-date.

• EBITDA grew over 100% year-over-year to $406M (adjusted) in Q3, and operating cash flow year-to-date was $588M, up $253M year-over-year.

Financial highlights

• Q3 net revenue was $1.28B, down 15% year-over-year; excluding eOne divestiture, down 9%.

• Adjusted operating profit was $329M (25.7% margin); Q3 net earnings were $223M (reported), $244M (adjusted); diluted EPS was $1.59 (reported), $1.73 (adjusted).

• Year-to-date revenue was $3.03B, down 18% year-over-year; adjusted operating profit $726M (23.9% margin).

• Operating cash flow year-to-date was $588M, up from $335M last year.

• Q3 gross margin improved to 70.4%, up from 67.1% last year.

Outlook and guidance

• Wizards revenue now expected flat to down 1% for 2024; Consumer Products revenue guidance lowered to down 12–14%.

• Adjusted EBITDA guidance unchanged at $975M to $1.025B; capital spending outlook at ~$225M.

• Monopoly GO! expected to contribute $105M in revenue for the year.

• Cost savings target of $750M gross by 2025, with $200–$250M net savings expected in 2024.

• Management expects continued benefits from cost savings, supply chain improvements, and focus on core brands.