Hasbro, the company behind popular franchises like Dungeons & Dragons and Transformers, is reportedly cutting 1,100 jobs, as stated in an SEC filing. This comes after an earlier layoff of 800 employees in January. The company aims to save $350-400 million in costs by 2025. CEO Chris Cocks explained that the company will focus on licensing, scaling entertainment, and investing in brand development. Hasbro’s revenue has declined by 10% year over year, blamed on “market headwinds.”
Despite the overall decline in revenue, Hasbro’s Wizards of the Coast (WoTC) division, responsible for Dungeons & Dragons and Magic the Gathering, has seen a 40% increase in revenue to $423.6 million, with a $203.4 million operating profit. Cocks intends to shift the company’s focus to its profitable areas, such as WoTC and digital gaming.
The popular role-playing game Dungeons & Dragons has experienced a resurgence in recent years, largely due to the influence of third-party content creators like Critical Role and Dimension 20. The franchise has also seen success in other media, including a Hollywood film and the highly successful video game Baldur’s Gate III. These successes have contributed to the game’s recognition, culminating in Baldur’s Gate III winning Game of the Year at the recent Game Awards.
Despite the continued success of its entertainment-related properties, Hasbro’s traditional toys business is in decline. However, the company has an unexpected cash cow in Wizards of the Coast, which was acquired 24 years ago. CEO Chris Cocks referred to the Dungeons & Dragons strategy as a broad four-quadrant strategy, similar in awareness to franchises like ‘Lord of the Rings’ and ‘Harry Potter.’ However, the company has faced challenges in translating the open-ended nature of the game into a more linear and structured format for mass audiences.
Cocks emphasized the need to modernize and streamline the company to position it for future growth. Hasbro’s layoff of employees reflects the company’s attempts to ensure profitability and sustainability in the face of changing market dynamics. Hasbro’s adaptation to a rapidly changing entertainment landscape represents a broader trend in the industry that reflects the evolving consumer preferences and behaviors.
