Wizards of the Coast are crushing it as they just posted record sales and profits for Q2 despite shipping issues- check it out!
They had a crazy quarter with insane sales and somehow managed a 53% profit! This is crazy as for every dollar of product they sold, they made 53 cents, which for a company of this size is honestly almost unheard of.
We’ll also check out the sales for Hasbro overall and compare the two. Anyway, you look at it, this is just an insane year for Wizards.
Wizards of the Coast Post Record Sales Quarter
Here are the highlights from Wizards and Hasbro:
Wizards of the Coast and Digital Gaming segment revenues increased 3%. Revenues increased 5% excluding a negative $8.2 million impact of foreign exchange.
- Tabletop revenues grew 15% led by MAGIC: THE GATHERING.
- Digital and licensed gaming declined 36% based on release timing and reflecting the difficult comparison with the launch of Dark Alliance and Magic: The Gathering Arena mobile last year.
- Operating profit of $225.6 million was 53.7% of revenue and reflects continued significant investments in Wizards of the Coast brands, as well as higher paper and freight costs. These costs were more than offset by lower launch-related product development, advertising and depreciation costs associated with Dark Alliance released in early third quarter of 2021. We continue to invest in digital gaming initiatives and talent to support long-term growth in the segment.
- For the full-year, on a constant currency basis, we expect high single-digit to low double-digit revenue growth with operating profit margin down slightly from 42.5% in full-year 2021 as we continue investing in growing these valuable brands.
So, some big things here. First, as we said, they had a profit of 53%, so that’s something. Then, they grew 15%, with a 36% decrease due to timing and difficulties of launches. They offset this with less advertisement and such, but their sales rose a ton, and the profit margin did as well.
Hasbro Q2 Highlights:
Now, let’s check out the highlights for Hasbro as a whole:
- Net revenues increased 1% to $1.34 billion
- Revenues up 4% absent an unfavorable $32.7 million impact of foreign exchange
- Consumer Products segment revenues up 7%; up 9% absent the impact of foreign exchange
- Wizards of the Coast and Digital Gaming segment revenues up 3%; up 5% absent the impact of foreign exchange
- Entertainment segment revenues declined 18% driven by the sale of the music business in the beginning of the third quarter 2021; down 16% absent the impact of foreign exchange; and down 4% excluding the Music business
- Operating profit of $219.1 million, or 16.4% of revenues
- Adjusted operating profit up 14% to $241.0 million, or 18.0% of revenues, up 200 basis points
- Net earnings of $142.0 million, or $1.02 per diluted share, up more than 100%
- Adjusted net earnings up 10% to $160.6 million, or $1.15 per diluted share
- EBITDA of $285.4 million
- Adjusted EBITDA up 6% to $308.3 million
- Completed D&D Beyond acquisition and returned $221.4 million to shareholders through dividend and share repurchase
- Paid $146.3 million for D&D Beyond, a strategic, complementary acquisition that accelerates direct-to-fans capability for Dungeons & Dragons in physical and digital play
- Paid $97.4 million in dividends to shareholders during the quarter
- Repurchased $124.0 million of Hasbro common stock.
As you can see, they did pretty well overall, and even a single % of the increase is a lot when you’re in the billions! Maybe the most interesting part is the D&D Beyond acquisition. It has already returned over $200 million, and it looks like the purchase was great for the company.
This means we will continue to see plenty more D&D action from them!
What do you think about the Q2 sales and the comparison to Games Workshop which seems to be making the wrong moves?
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About the Author: Travis Pasch
