Tariff Uncertainty Hurt Toy Sales In Q2, Hasbro And Mattel Report

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]