Hasbro has always been synonymous with the toys that define childhood. But in its second century in business, the maker of Mr. Potato Head, G.I. Joe, and My Little Pony is diversifying away from toys—and away from its longtime target demographic of children.
CEO Chris Cocks, appointed in 2022, is refashioning the company into one that gets most of its sales from card games and bets heavily on demand from grown-ups, or—as Cocks calls them—“kidults.”
Cocks’ strategy is helping reinvigorate Hasbro after a period of sales declines that coincided with an industry-wide slump and a product pipeline that had grown stale. Hasbro on Tuesday reported a 16% increase in revenue to $1.14 billion, topping analysts’ expectations of $1.07 billion, sending shares up sharply; they are up 9% for the year.
A major contributor to those stellar results was the runaway success of the 33-year-old “Magic: The Gathering” card game business, which got a boost from its collaboration with Marvel Super Hero collectibles. Hasbro has reinvigorated Magic in recent years through aggressive digital integration and by making it easier for large groups of people to play together. That business grew 32% year-over-year to pass the quarterly $500 million mark for the first time. And Cocks sees a lot more upside.
“Magic is not a niche hobby business,” Cocks told Wall Street analysts on Tuesday morning. “It is a mega franchise. ‘Magic: The Gathering’ belongs in the same company as Pokémon, EA Sports, World of Warcraft, and Minecraft.”
Hasbro has also gotten a boost from the traditional toy market waking up from a long slumber. Research firm Circana found toy sales rising by double-digit percentage this spring, including 13% in April, the most recent month for which it published data. Toys had been slumping for several years after a pandemic-era boom.
Adults, specifically women, are the demographic fueling Hasbro’s comeback. According to Circana, more than 50% of overall industry growth is coming from women as toymakers capitalize on nostalgia for longtime brands and demand for updated versions of the classics.
Hasbro’s latest launch is aimed directly at female toy lovers. Last week, it introduced Blooms by Play-Doh, which allows consumers to craft realistic-looking floral arrangements that can be preserved and displayed. It’s the first time in the brand’s 70-year history that Play-Doh has designed a product specifically for grown-ups.
“Where they are leaning in and are pretty eager for more product is in the gamified, entertainment-driven, multi-purchase, multi-generational products, basically stuff for kidults,” Cocks said of the toy stores that sell Hasbro products.
Cocks became CEO in 2022 after a stint at Microsoft’s Xbox division, where he managed game portfolios and marketing strategies for key Xbox launches. He’s prioritized Hasbro’s core businesses, but modernized them too. Early on, he radically shrank Hasbro by selling its eOne television and movie business to Lionsgate for a fraction of the $4 billion it had paid for it in 2018. Hasbro had aspired to become a major media contender, but the high cost of film and TV production caused it to burn through a ton of cash, and Cocks decided Hasbro’s strategy needed a reset.
Under Cocks, Hasbro has also refocused its video games strategy on getting more mileage out of its existing properties. The CEO announced on Tuesday that Hasbro would lower spending on the video game business by at least 25% every year. Hasbro will still create new titles but will do so with a co-publisher and tie them to trading card and role-playing games, as it’s doing with its upcoming releases Exodus and Warlock, scheduled for next year.
In a Fortune interview in 2024, Cocks said Hasbro hadn’t focused enough on its toy business, adequately filled its innovation pipeline, or even had a clear philosophy to guide it through a reinvention.
Cocks’ new philosophy reframes Hasbro as operating in “the industry of play”—rather than defining the company purely as a toy or video game maker. At the moment, it’s working.
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