Hasbro Q4 Earnings Surpass Estimates, Revenues Decline Y/Y

Hasbro, Inc. HAS reported fourth-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top line declined year over year while the bottom line increased from the prior year's quarter figure.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Hasbro unveiled a new strategic plan, Playing to Win, with a focus on expanding its global reach and enhancing profitability. The initiative aims to grow Hasbro’s audience from 500 million to over 750 million through play-driven engagement and strategic partnerships. The company projects mid-single-digit revenue growth and annual operating margin improvements of 50-100 basis points through 2027. Additionally, Hasbro targets a 2.5x gross debt-to-adjusted EBITDA ratio by 2026 and expects its operational excellence program to generate $1 billion in cost savings.Following the announcements, the stock gained 3.9% in the pre-market trading session.Earnings & RevenuesHasbro, Inc. Price, Consensus and EPS Surprise Hasbro, Inc. price-consensus-eps-surprise-chart | Hasbro, Inc. QuoteIn fourth-quarter 2024, HAS reported adjusted earnings per share (EPS) of 46 cents, which beat the Zacks Consensus Estimate of 38 cents. In the year-ago quarter, it reported an adjusted EPS of 38 cents.Net revenues of $1.1 billion beat the consensus mark of $1.03 billion. The top line declined 14.5% year over year from $1.29 billion reported in the prior year period.Brand PerformancesIn the quarter under discussion, Franchise Brands reported revenues of $786.2 million, down 7% year over year. Our estimate for Franchise Brands revenues was $809.7 million.Partner Brands’ revenues increased 18% year over year to $181 million. Per our model, revenues from Partner Brands were $110.2 million.Revenues at Portfolio Brands were $134.4 million, down 11% from the prior-year levels. Our estimate for the Portfolio Brands revenues was $117.9 million.Total gaming category revenues fell 5% year over year to $542.5 million.Segmental RevenuesHasbro has three reportable operating segments: Consumer Products, Wizards of the Coast, and Digital Gaming and Entertainment.In the fourth quarter, net revenues from the Consumer Products segment decreased 1% year over year to $746.3 million. The drop was due to lower volume. Adjusted operating margin was 8% against negative 15.3% reported in the year-ago quarter.The Wizards of the Coast and Digital Gaming segment’s revenues totaled $339 million, down 7% from $363.2 million reported in the year-ago quarter. Adjusted operating margin was 23.9% compared with 28.4% reported in the year-ago quarter.The Entertainment segment’s revenues plunged 91% year over year to $16.3 million. Adjusted operating margin was 1.2% against negative 17.9% reported in the year-ago quarter.Operating HighlightsIn the fourth quarter, Hasbro’s cost of sales (as percentages of net revenues) was 32.6% compared with 44.5% in the year-earlier quarter.Selling, distribution and administration expenses were $360.6 million, compared with $430.4 million reported in the prior-year quarter.The company reported adjusted EBITDA of $164.8 million compared with $10.6 million a year ago.Hasbro’s Balance SheetAs of Dec. 29, 2024, cash and cash equivalents were $695 million, compared with $545.4 million as of Dec. 31, 2023. At the end of the reported quarter, inventories totaled $274.2 million, compared with $332 million a year ago.As of Dec. 29, 2024, long-term debt was $3.38 billion, up from $2.97 billion as of Dec. 31, 2023.HAS 2024 HighlightsNet sales in 2024 amounted to $4.13 billion compared with $5 billion in 2023.Net income in 2024 came in at $562.8 million compared with $348.8 million reported in 2023.In 2024, adjusted diluted EPS came in at $4.01 compared with $2.51 reported in the previous year.2025 OutlookFor 2025, Hasbro anticipates a slight increase in total revenues on a constant currency basis. It expects adjusted operating margin to range between 21% and 22%. The company projects adjusted EBITDA in the range of $1.1 billion to $1.15 billion.Other UpdatesHasbro’s Playing to Win strategy marks a pivotal shift toward renewed growth by doubling down on play-focused brands and strategic partnerships. This approach has enabled the company to streamline operations, exit non-core businesses like eOne and cut $600 million in costs, strengthening its balance sheet. Hasbro is prioritizing high-margin, high-growth segments such as digital gaming, licensing and global partnerships, expanding into themed entertainment, quick-service restaurants and AAA video games.The strategy is built on five pillars: strengthening profitable franchises, targeting older demographics, expanding reach in emerging markets, enhancing digital and direct sales and scaling through partnerships. The company emphasizes operational upgrades in supply chain efficiency, AI and digital transformation, reinforcing its commitment to innovation, community engagement, and long-term sustainability.HAS’ Zacks RankHasbro currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.Recent Consumer Discretionary ReleasesHilton Worldwide Holdings Inc. HLT reported exceptional fourth-quarter 2024 results, wherein adjusted earnings and total revenues surpassed the Zacks Consensus Estimate and grew year over year.The company's performance was backed by strong demand for leisure travel, with continued growth in business transient and group travel. These robust trends supported growth in occupancy and average daily rate, resulting in increased revenue per available room. Furthermore, favorable net unit growth compared with last year and the continuous efforts in expanding the portfolio globally added to the uptrend. HLT expects the robust travel trends to continue into 2025, positioning it to deliver strong results in the near term.Mattel, Inc. MAT reported fourth-quarter 2024 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis.In 2024, Mattel repurchased $400 million worth of shares and improved its leverage ratio. The company remains ahead of schedule in achieving its $200 million cost-savings target by 2026. For 2025, Mattel projects continued revenue and earnings growth, increased investments in digital gaming and a $600 million share repurchase program, underscoring its commitment to long-term shareholder value creation. MAT anticipates adjusted EPS in 2025 to be between $1.66 and $1.72 compared with $1.62 reported in 2024.Marriott International, Inc. MAR reported fourth-quarter 2024 results, with adjusted earnings and revenues beating the Zacks Consensus Estimate. The top line increased year over year while the bottom line declined from the prior-year quarter.Marriott posted strong results in 2024, driven by steady global travel demand and strategic portfolio expansion. The company’s development momentum remained strong, with the signing of a record number of new deals and its development pipeline reaching 577,000 rooms. Given its vast global footprint, a loyalty program comprising nearly 228 million Marriott Bonvoy members and an asset-light model, MAR remains well-positioned to capitalize on travel demand and drive growth in the upcoming periods.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Marriott International, Inc. (MAR): Free Stock Analysis Report Hasbro, Inc. (HAS): Free Stock Analysis Report Mattel, Inc. (MAT): Free Stock Analysis Report Hilton Worldwide Holdings Inc. 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