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What's going on?
Hasbro – the biggest toymaker in the US – posted better-than-expected quarterly earnings on Tuesday.
What does this mean?
Hasbro knows its audience: the company released an expansion set of its popular trading card game “Magic: The Gathering” last quarter, boosting orders for both tabletop and online versions of the game. That helped the company’s Wizards of the Coast segment – which also includes Dungeons & Dragons – grow operating profit by 17% last quarter from the same time last year. The low production costs of those games – along with higher prices for toys like Nerf Blasters and My Little Pony – helped give overall profitability a lift too. So while the strong US dollar meant Hasbro’s international profits were worth less when converted back, its net profit still grew by a better-than-expected 10%.
Why should I care?
The bigger picture: Growing up is optional.
You’d be forgiven for thinking those booming toys sales were all the result of enthusiastic kids, but nope: adults have played a big part in helping US toy sales surge over the past few years, according to data tracker NPD Group, while a separate survey has shown that 58% of adult respondents buy toys and games for themselves (tweet this). That might be why toymakers have started to market new products just to adults, with Lego devoting whole ranges to adult builders and Basic Fun! – the company behind Care Bears – planning to launch Lite-Brites for real people with jobs and mortgages in September.
Zooming out: Culture is dead.
Toymaker Mattel is going another direction altogether: it’s pursuing a broader strategy of moving from manufacturing company to intellectual property company. It’s been touting the upcoming Barbie movie as a “cultural event”, and it has a host of other projects in the pipeline, including a Magic 8 Ball movie you never knew you didn’t want.
Originally posted as part of the Finimize daily email.
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