According to a U.S. Securities and Exchange Commission filing, Hasbro will lay off 1,100 employees. Hasbro, the company behind franchises such as Dungeons & Dragons and Transformers, laid off 800 employees in January. Some employees will learn the fate of their jobs on Tuesday, while others will be laid off over the next year. Hasbro told shareholders it hopes to achieve cost savings of about $350 million to $400 million by 2025.
Hasbro CEO Chris Cocks wrote in a memo to employees that he would direct the company's attention to licensing opportunities, expanding entertainment and "freeing up our own content dollars to drive new brands." He blamed vague "market headwinds" for the company's losses.
Hasbro's overall revenue fell 10% year over year. However, Hasbro owns Wizards of the Coast (WoTC), which makes Dungeons & Dragons (D&D) and Magic the Gathering (Magic the Gathering), bringing in more than $1 billion in annual revenue. In the company's division that operates WoTC and digital games, revenue increased 40% year over year to $423.6 million, with net operating profit of $203.4 million.
Despite all this tremendous growth, Hasbro's overall performance has struggled. So it looks like Cox is refocusing Hasbro on things that will actually make the company money.
Dungeons & Dragons has grown in popularity over the past few years, thanks in large part to third-party content producers like Critical Role and Dimension 20, in which actors co-star in D&D for the entertainment of audiences. This year, the Dungeons & Dragons franchise also made waves with a Hollywood movie and the hugely successful Baldur's Gate III, a video game licensing the Dungeons & Dragons IP. Just last week, Baldur's Gate won Game of the Year at The Game Awards.
Hasbro finds itself at a strange crossroads—the toy business is in decline, but it suddenly has an unexpected cash cow in the form of Wizards of the Coast, which it acquired 24 years ago.
"The D&D strategy is a broad four-quadrant strategy," Cox said on an investor call in December. "We have this strong brand with the same kind of recognition as 'Lord of the Rings' or 'Harry Potter.' But Hasbro is trying to take Dungeons & Dragons, a game developed by the player base." There are growing pains in the game system that develops plots and characters - like "Harry Potter" and "Lord of the Rings", where every fan knows the same characters and stories. Although the movie "Dungeons and Dragons: Thieves' Honor" received good reviews when it was released in March, it ultimately failed at the box office. "
"For Hasbro to grow, we must first ensure our foundation is solid and profitable," Cox wrote in a company memo. "To do this, we need to modernize our organization and become leaner."