Toy and board game company, Hasbro Inc, reported low sales in its fourth quarter. The sudden decline was linked to low interest in Star Wars-related toys, a first for the franchise which hopped back in cinemas in 2015.
Hasbro reported a 2 percent sales decline during the holiday quarter, failing to meet their forecast for sales growth of between 4 percent and 7 percent.
In addition to the disappointing Star Wars sales, the company’s Chief Executive, Brian Goldner, blamed the decline on low interest in Europe and disruption from the Toys R Us bankruptcy.
However, the Monopoly maker said that it has contingency plans for Toys R Us’ bankruptcy filing. The company is confident it can rebound by mid-2018. Toys R Us was one of the primary means of distribution for Hasbro, and the toy store chain’s latest announcement would cut said distribution significantly. Toys R Us will reportedly shut down 180 stores, about one-fifth of Hasbro’s store fleet.
Goldner did not believe suggestions that fans were getting fed up with Star Wars products, remaining confident that the series will continue to provide a steady source of annual revenue.
“I don’t see it as Star Wars fatigue. I feel like there’s great vitality in Star Wars.” Mr. Goldner said.
According to Goldner, consumer demand was at an all-time high once Star Wars returned to cinemas in 2015, providing the company with a long window ahead of the movie’s release to sell toys. However, because The Last Jedi premiered on Dec. 15, toy sales couldn’t pick up until then.
Despite the low sales, Hasbro shares spiked more than 7 percent Wednesday. More so, the company’s revenue in 2017 managed to surpass that of rival Mattel Inc. for the first time in more than 20 years. Hasbro reported its sales rose 4 percent to 5.21 billion for the full year, topping Mattel’s annual financial earnings of $4.88 billion.
The Nerf Gun maker revealed a fourth-quarter loss of $5.3 million, or 4 cents a share, significantly lower than their $192.7 profit or $1.52 a share, a year earlier.
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