UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________ FORM 10-Q __________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 29, 2025 (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) or TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-6682 ______ ...

My previous investment thought on Hasbro Inc. (NASDAQ: HAS ) was a buy rating because growth tracked well against my expectation, and the setup for the rest of the year was de-risked with the FY25 guidance. It has been a I focus on long-term investments while incorporating short-term shorts to uncover alpha opportunities. My investment approach revolves around bottom-up analysis, delving into the fundamental strengths and weaknesses of individual companies. My investment duration is the medium to long-term. ...

Core Viewpoint - Hasbro (HAS) has received an upgrade to a Zacks Rank 1 (Strong Buy), indicating a positive outlook for its earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system emphasizes the importance of changing earnings estimates as a key driver of stock price movements, with a strong correlation observed between earnings estimate revisions and near-term stock performance [4][6]. - For the fiscal year ending December 2025, Hasbro is projected to earn $4.70 per share, which remains unchanged from the previous year, but the Zacks Consensus Estimate has increased by 7.2% over the past three months [8]. Zacks Rating System - The Zacks Rank stock-rating system categorizes stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - The upgrade of Hasbro to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [10].

Core Insights - Sales of traditional toys by Hasbro and Mattel declined in Q2 due to delayed orders from retailers concerned about potential price increases from tariffs [2][4] - Both companies believe they are positioned to handle tariff impacts but are uncertain about consumer spending on toys amid rising household expenses [3][4] - Hasbro and Mattel reported earnings surprises, with Hasbro's net sales down 1% and Mattel's down 6%, both less than expected [4][5] Hasbro Insights - Hasbro's gaming segment, including Wizards of the Coast, saw a 16% revenue growth, while traditional toys decreased by 16% [6] - The recent release of Magic: The Gathering based on Final Fantasy achieved $200 million in revenue in one day, indicating strong demand [8] - Hasbro's CEO warned that popular toys might be hard to find during the holidays due to delayed orders, specifically mentioning Play-Doh Barbie and other new lines [9][10] Mattel Insights - Mattel is focusing on growth through its entertainment division, planning to release one to two films annually starting in 2026 [12] - The company is collaborating with OpenAI to enhance interaction with toy characters using AI technology [14] - Despite a larger-than-expected sales decline, Mattel reported growth in its American Girl brand and anticipates strong sales from upcoming product lines [15][16] Industry Trends - Both Hasbro and Mattel are diversifying away from traditional toys, with Hasbro's acquisition of Wizards of the Coast proving beneficial [5] - The toy industry is facing challenges from tariffs, but larger companies like Hasbro and Mattel have the financial resources to mitigate impacts and potentially gain market share [17]

Core Viewpoint - Morgan Stanley raised the target price for Hasbro (HAS) from $83 to $85 [1] Group 1 - The adjustment in target price indicates a positive outlook for Hasbro's stock performance [1]

Retailers have pushed back holiday orders because of tariffs, and that may complicate replenishment, Hasbro says. https://t.co/CWILrjxQy7 ...

Core Insights - Hasbro attributes its ability to mitigate the impact of tariffs this quarter to its successful strategies, particularly in its Wizards of the Coast division, which includes Magic the Gathering, showing a 23% revenue increase [2][3] Financial Performance - Overall revenues for Hasbro decreased by 1%, with growth in the Wizards and digital gaming divisions nearly offsetting a decline in consumer products due to tariffs [2] - The company anticipates a gross impact from tariffs ranging between $100 million to $300 million in 2025 [4] Strategic Responses - CEO Chris Cocks mentioned that the company is addressing tariff-related costs through cost reductions, rebalancing marketing expenditures, diversifying suppliers, and implementing targeted pricing actions [3] - CFO Gina Goetter noted that trade uncertainties are causing retailers to delay holiday inventory builds, which negatively impacted Q2 consumer products revenue [4] Consumer Sentiment and Market Trends - The company is cautiously optimistic about its toy and general merchandise business, as consumer sentiment appears to be improving [5] - Research indicates that nearly half of U.S. consumers have faced product shortages, with 58% of those living paycheck to paycheck affected [6] - Approximately one-third of consumers have been informed that tariffs are causing higher prices, with a quarter of consumers noting increased costs without specific mention of tariffs [7]

Core Insights - Hasbro Inc reported a notable second-quarter earnings and revenue beat, raising its revenue outlook and indicating a lower-than-expected long-term impact from tariffs [1] - Despite a 2.7% decline to $75.49, Hasbro's stock has shown significant improvement since its annual low of $49.00 on April 9, reflecting a 33% year-to-date gain [2] - The stock's pullback has found support at the $75 level, following a multi-year peak of $78.83 on July 1 [2] Options Trading Activity - Options traders have shown a bullish sentiment, with a 10-day call/put volume ratio of 6.47, ranking higher than 84% of readings from the past year [3] - Short-term traders also exhibit a call-bias, as indicated by a Schaeffer's put/call open interest ratio (SOIR) of 0.40, which is in the 5th percentile of readings from the past 12 months [3] Volatility Performance - Hasbro's stock has historically outperformed volatility expectations, as evidenced by a Schaeffer's Volatility Scorecard (SVS) of 95 out of 100 [4]

Core Insights - Hasbro, Inc. reported second-quarter fiscal 2025 results with earnings and revenues exceeding the Zacks Consensus Estimate, although the top line declined year over year due to weaker contributions from the Consumer Products and Entertainment segments [1][3][7] Financial Performance - Adjusted earnings per share (EPS) for Q2 fiscal 2025 were $1.3, surpassing the Zacks Consensus Estimate of 78 cents, and up from $1.22 in the same quarter last year [3][7] - Net revenues reached $980.8 million, beating the consensus mark of $877.3 million, but reflecting a 1% decline from $995.3 million reported in the prior-year period [3][7] Segment Performance - Consumer Products segment revenues decreased 16% year over year to $442.4 million, although this figure exceeded expectations, supported by strong licensing revenues [4] - The Wizards of the Coast and Digital Gaming segment saw revenues increase by 16% to $522.4 million, while the adjusted operating margin was 46.3%, down from 54.7% in the previous year [5] - The Entertainment segment's revenues fell 15% year over year to $16 million, with an adjusted operating margin of 63.1%, down from 94.1% in the prior-year quarter [5] Cost and Efficiency - Cost of sales as a percentage of net revenues was 23%, slightly improved from 23.9% in the year-earlier quarter [6] - Selling, distribution, and administration expenses were reduced to $282.8 million from $318.5 million reported in the prior-year quarter [6] - Adjusted EBITDA for the quarter was $302 million, compared to $313.5 million a year ago, exceeding the estimate of $231.5 million [6] Outlook - Hasbro raised its full-year revenue and adjusted EBITDA guidance, now expecting total revenues to increase in mid-single digits on a constant currency basis, up from a previous expectation of slight growth [2][9] - Adjusted operating margin is now anticipated to be between 22% and 23%, compared to the earlier forecast of 21-22% [9] - Adjusted EBITDA is expected to range from $1.17 billion to $1.2 billion, an increase from the prior expectation of $1.1 billion to $1.15 billion [9] Balance Sheet - As of June 29, 2025, cash and cash equivalents were $546.9 million, down from $626.8 million as of June 30, 2024 [8] - Inventories totaled $417.1 million compared to $357.6 million a year ago [8] - Long-term debt decreased to $3.32 billion from $3.46 billion as of June 30, 2024 [8]

Core Insights - Hasbro reported revenue of $980.8 million for the quarter ended June 2025, reflecting a year-over-year decline of 1.5% but an EPS of $1.30, up from $1.22 a year ago, indicating a positive earnings surprise of +66.67% compared to the consensus estimate of $0.78 [1][2] Revenue Performance - External Net Revenues from Entertainment were $16 million, below the average estimate of $19.18 million, representing a year-over-year decline of -14.9% [4] - External Net Revenues from Consumer Products reached $442.4 million, exceeding the average estimate of $413.93 million, but still showing a decline of -15.7% year-over-year [4] - External Net Revenues from Wizards of the Coast and Digital Gaming were $522.4 million, surpassing the estimated $459.57 million, with a year-over-year increase of +15.6% [4] Segment Analysis - Within Wizards of the Coast and Digital Gaming, Tabletop Gaming generated $406.3 million, exceeding the average estimate of $337.95 million, marking a year-over-year increase of +32.1% [4] - Digital and Licensed Gaming revenues were $116.1 million, below the average estimate of $124.14 million, reflecting a year-over-year decline of -19.6% [4] - Operating profit for Wizards of the Coast and Digital Gaming was $241.8 million, significantly above the average estimate of $185.99 million [4] - The Corporate & Other segment reported an operating loss of $-16.7 million, better than the average estimate of $-37.23 million [4] - The Entertainment segment achieved an operating profit of $6.3 million, exceeding the estimated $0.91 million [4] Stock Performance - Hasbro's shares have returned +6.9% over the past month, outperforming the Zacks S&P 500 composite's +5.9% change, with a current Zacks Rank of 3 (Hold) indicating potential performance in line with the broader market [3]