Shares of Hasbro Inc. (NASDAQ: HAS) were up 1.4% on Tuesday. The stock has gained 26% thus far this year. The company reported mixed results for the first quarter of 2021 as earnings beat estimates but revenues fell short. For the full year of 2021, Hasbro expects revenues to grow in the double digits.
Revenues gained 1% in Q1 to reach $1.11 billion but came in shy of estimates. Q1 marks the first quarter of Hasbro reporting its results under its new segment structure. The company saw revenue growth of 14% in the Consumer Products segment and 15% in the Wizards of the Coast and Digital Gaming segment during the quarter. However, the Entertainment segment saw revenues drop 32% due to declines in theatrical. Adjusted profits jumped 75% year-over-year to $1.00 per share, surpassing expectations.
Gaming and Entertainment
Hasbro has benefited from an increase in gaming since the onset of the COVID-19 pandemic and this continued in Q1 with higher engagement levels driving double-digit growth in the Wizards of the Coast and Digital Gaming division.
Even though Hasbro Gaming saw a drop of 3% in revenue during the first quarter, the company’s total gaming category, which includes all gaming revenue, witnessed a 7% growth to $365.3 million. Games like MAGIC: THE GATHERING, DUNGEONS & DRAGONS and MONOPOLY saw notable growth, with MAGIC and D&D posting double-digit revenue increases, fueled by both tabletop and digital.
D&D also saw growth in licensed digital gaming revenue. Hasbro expects the second quarter of 2021 to be the biggest for MAGIC and Wizards this year. Hasbro has several new games such as Dark Alliance lined up for release during the spring and the holiday season this year as well its classic games which will help meet the high demand within gaming.
Hasbro is benefiting from the popularity of hit shows on the Disney+ streaming platform. Its Partner Brands revenues grew 3%, driven by strong demand for toys and games related to the Star Wars and Marvel franchises. Shows like The Mandalorian and The Falcon and The Winter Soldier are driving strong demand for new and existing products.
The Entertainment segment saw revenues drop 32% during the quarter as theaters remained closed as opposed to last year when theaters were open for the most part of the quarter. eOne has over 200 projects in development across movies, television and animation that feature over 30 Hasbro IPs.
The company expects scripted TV deliveries to increase later in 2021 and it aims to return to 2019 revenue levels in TV and film this year. In unscripted, Hasbro has a slate of shows underway in the US, UK and Canada with over 40 active productions.
Last week, Hasbro’s rival Mattel Inc. (NASDAQ: MAT) announced its first quarter 2021 earnings results. The company saw sales increase 47% to $874 million. Adjusted loss amounted to $0.10 per share.