Hasbro takes action to lessen impact of tariffs by shifting toy production

In recent developments, Hasbro, a prominent toy and gaming company, has been proactively addressing the impacts of U.S. tariffs on products sourced from China. During its fourth-quarter earnings call, Hasbro's Chief Financial Officer, Gina Goetter, indicated the company's optimistic outlook on navigating the challenges brought by tariffs. The company aims to adjust its manufacturing processes and lessen dependency on Chinese production by reducing the share of U.S. toys and games coming from China from 50% down to under 40% within two years. This shift forms part of Hasbro's strategic response to the anticipated effects of tariffs on China, Mexico, and Canada reported in their 2025 financial guidance. In addition to manufacturing changes, Hasbro is considering potential pricing adjustments to mitigate tariff impacts. This circumstance reflects a broader challenge within the industry, as rival toy makers like Mattel have mentioned increasing toy prices due to tariffs. Hasbro's licensing segment remains unaffected by tariffs and continues to contribute significantly to profit margins. Notably, the company has also announced a collaboration with Mattel to create unique Play-Doh versions of Barbie dolls, marking a new creative venture aimed at enhancing product offerings. However, despite their strategic initiatives, Hasbro disclosed a fourth-quarter net loss of $26.5 million compared to a more significant loss in the same quarter the previous year. While Hasbro's full-year revenue declined to $4.14 billion—down 17% from prior figures—exclusions of its eOne divestiture indicated a smaller revenue decline of 7%. Hasbro's digital and licensed gaming revenue, however, showed a notable increase of 35% in the fourth quarter year-over-year, emphasizing the strengths of their gaming sector. Overall, Hasbro's efforts appear aimed at navigating the evolving landscape of trade policies while maintaining competitiveness in a challenging market.