tapebrief
HAS · Q1 2026

HAS · Q2 2025 Earnings

Bullish

Hasbro

Reported July 23, 2025

30-second summary

Magic: The Gathering grew 23% YoY (Tabletop +32%) and pulled Wizards segment revenue +16%, masking a -16% collapse in Consumer Products and a $1.0B non-cash goodwill impairment that drove GAAP EPS to -$6.10. Management raised revenue, margin, and EBITDA; newly disclosed Wizards and CP segment guides. Tariff exposure narrowed to the low end ($60M vs prior $60–180M range). The print is a clean bifurcation: the gaming franchise is structurally accelerating; the toy business is being actively shrunk.

Headline numbers

EPS

Q2 FY2025

$1.30

Revenue

Q2 FY2025

$0.98B

-1.4% YoY

Gross margin

Q2 FY2025

77.0%

Operating margin

Q2 FY2025

-81.4%

Key financials

Q2 FY2025
MetricQ2 FY2025YoY
Revenue$0.98B-1.4%
EPS$1.30—
Gross margin77.0%—
Operating margin-81.4%—

Guidance

Prior quarter data unavailable — comparison not possible.

Segment performance

Q2 FY2025
SegmentQ2 FY2025YoY
Wizards of the Coast and Digital Gaming$0.522B+16.0%
Consumer Products$0.442B-16.0%
Entertainment$0.016B-15.0%
Tabletop Gaming$0.406B+32.0%
MAGIC: THE GATHERING$0.412B+23.0%
Hasbro Total Gaming Revenue$615.8M—

Profitability

Q2 FY2025
SegmentQ2 FY2025
Wizards Adjusted Operating Margin46.3%
Adjusted Operating Profit$247.1M
Adjusted EBITDA$302.0M

Other KPIs

Q2 FY2025
SegmentQ2 FY2025YoY
North America$0.236B-23.0%
Europe$0.096B+4.0%
Cash Returned to Shareholders$98M—
Debt Reduced$12M—

Management tone

Five tone shifts dominate the print, and they all point the same direction on Magic while marking a structural reset on Consumer Products.

Magic has been re-cast from "strong performer" to durable, accelerating engine. The framing "Magic's engine of growth is durable, it's diversified, and it's accelerating" signals confidence that the franchise is no longer a single-set story but a portfolio with depth — Tarkir Dragonstorm pacing as the top-selling premier set of all time, Secret Lair delivering its strongest sales quarter ever, and backlist already setting an annual record at the half-year mark.

Universes Beyond has graduated from experiment to proven acquisition channel. Management called out that Final Fantasy "set a record for new player growth, delivering more new players in its first two weeks than any prior set posted over an entire season" — the kind of specific KPI they reach for when they want investors to underwrite the strategy as repeatable, not one-off.

Digital, previously discussed cautiously, is now ready for show-and-tell. The Giant Skull / Stig Asmussen partnership on a premium Unreal Engine 5 title plus Exodus represent the first concrete external milestones — "we're now in a place where we can start talking more confidently about our digital pipeline" is a deliberate change in posture.

Consumer Products has been marked down in tone, not just on the balance sheet. The $1B goodwill impairment is paired with a clear acknowledgement that US retailers shifted from direct imports to domestic ordering due to tariff uncertainty, and that holiday shelf resets have been pushed back. This is no longer a cyclical headwind to ride out — it's structurally smaller, more curated, more European-weighted.

Tariffs moved from a $60–180M range of dread to a $60M lower-end estimate. Management still flagged 2026–2027 as the harder period, but the 2025 framing is now decisively tighter, which is what enabled the FY guide raise.

Recurring themes management leaned on this quarter:

Magic: The Gathering as primary growth engine with unprecedented demand (23% YoY, 32% YTD growth)Universes Beyond IP strategy driving new player acquisition and broadening demographicsDigital expansion with Exodus and premium D&D game signaling long-term growth pipelineConsumer Products stabilization through SKU rationalization and portfolio curation despite tariff headwindsRecord operating margins (25.2% in Q2, guidance raised to 22-23% for FY25) despite royalty and tariff costsSupply chain resilience through geographic diversification reducing China exposure from 50% to <40% by 2027

Risks management surfaced:

Tariff impact worsening in 2026-2027 despite current $60M estimateRetail inventory caution and delayed holiday ordering reducing near-term demand visibilityConsumer price elasticity constraints limiting pricing power at key price pointsDigital game depreciation costs beginning in 2026 pressuring margins below 40%Tariff-induced portfolio culling reducing revenue potential in non-US markets

What to watch into next quarter

Whether Magic's Q3 print sustains 20%+ YoY growth given Final Fantasy supply constraints — the high-20s% FY guide implies the H2 cadence must extend the +40% H1 tabletop pace, not regress to Q2's +32%.

Holiday ordering pattern in Consumer Products: management said delayed Q2 orders should land in Q3/Q4 — if Q3 NA CP revenue does not recover from -23%, the "delayed ordering" thesis is wrong and the decline is structural.

Wizards adjusted operating margin trajectory — Q2 printed 46.3% vs. 42–43% FY guide, implying H2 margin step-down. Watch whether digital depreciation timing (flagged to begin pressuring margins in 2026) starts showing earlier.

Tariff disclosure update for 2026 — management acknowledged worse impact in 2026–2027 without quantifying. Next quarter is the natural window for a number.

China sourcing progress against the "below 40% by 2027" target (down from ~50% today) — incremental disclosure on geographic mix.

Whether the Giant Skull premium title gets a release window; ambiguity here would suggest the "confident digital pipeline" framing was premature.

Sources

  1. Hasbro Q2 2025 press release / 8-K exhibit 99.1: https://www.sec.gov/Archives/edgar/data/46080/000004608025000119/exhibit991q22025.htm
  2. Hasbro Q2 2025 earnings call — prepared remarks.

Get the next brief, free.

We publish analyst-grade earnings briefs the same day or morning after every call — headline numbers, segment KPIs, Q&A highlights, and tone analysis. Free during beta.

This is not investment advice.