‘Paused Shipments’ to Russia Give Hasbro $100M in ‘Potential’ Exposure: CFO
Hasbro faces the “potential risk” of $100 million in lost sales this year to Russia, equaling about 2% of 2021 revenue, said Chief Financial Officer Deborah Thomas on a Q1 earnings call Tuesday. “We have paused shipments into Russia” in the aftermath of its Feb. 24 Ukraine invasion, she said.
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As the result of the suspended shipments, Hasbro was asked "in the past" about the size of its Russia business, said Thomas: “So we wanted to quantify that for people and that is exactly what we're doing.” Halting Hasbro shipments into Russia is “a situation that we're all continuing to evaluate day by day and week-by-week,” said Chief Operating Officer Eric Nyman. “With regards to the rest of Europe, our European business is in good shape.”
Games, plus “multigenerational play entertainment” and direct-to-consumer, will be “key focus areas” for Hasbro in future quarters, said CEO Chris Cocks. He took the helm in late February after being president of Hasbro’s digital games business.
For Hasbro, games were a $2.1 billion business in 2021, growing 19% year over year, while multigenerational play “is a significant growth opportunity for us.” said Cocks. “It may surprise many that Hasbro generates the majority of our profits among consumers over the age of 13.” Hasbro sees “a big opportunity in embracing the agelessness of play as we unlock more value through play and entertainment across our portfolio.”
Hasbro’s Q1 entertainment revenue was up 4% year over year to $227.5 million. TV, film and animated content drove the growth, said Cocks, including the premiere of Transformers: BotBots, a top 10 kids series on Netflix in its first week. Power Rangers Dino Fury “was also one of the top 10 most watched kids shows on Netflix in all markets it launched,” he said.