Hasbro Shaving Off 15 Percent From Global Workforce as Top Executive Leaves Toy Firm

Hasbro toys are displayed at a Target store in San Rafael, Calif., on Feb. 8, 2019 (Justin Sullivan/Getty Images)

Global branded entertainment leader Hasbro announced a 15 percent reduction in its workforce as well as the exit of its chief operating officer while projecting weaker revenues for the fourth quarter.

In October 2022, Rhode Island-headquartered Hasbro announced that it would deliver $250–300 million in annualized run-rate cost savings by the end of 2025. In accordance with the goal, the company is implementing “organizational changes” that will see roughly 1,000 job positions cut from its global workforce getting this year, Hasbro said in a press release on Jan. 26.

The new measures will include leadership changes as well as a new organizational model, which Hasbro will discuss in more detail during the upcoming conference call.

“The elimination of these positions will impact many loyal Hasbro employees, and we do not undertake this process lightly. However, the changes are necessary to return our business to a competitive, industry-leading position and to provide the foundation for future success,” said CEO Chris Cocks.

Job reductions will be implemented in the coming weeks, the company stated. As part of these changes, president and COO Eric Nyman is departing from the firm, Hasbro said.

“We are grateful for Eric’s dedication to Hasbro over the last 18 years and the leadership he has provided. On behalf of everyone at Hasbro, we wish him well in his future endeavors,” Cocks stated.

Weak Revenues, Game License Controversy

Hasbro’s layoff announcement was accompanied by weaker revenue projections for fourth quarter 2022. The company is expecting preliminary fourth-quarter revenue to be at around $1.68 billion, which would be down 17 percent from the same period in 2021.

Only the Wizards of the Coast and Digital Gaming segment is projected to see positive revenues, up by 22 percent year over year. The consumer products segment is only estimated to bring in roughly $1 billion, down 26 percent. Revenue from the entertainment segment is predicted to be lower by 12 percent.

Hasbro is set to reveal its fourth-quarter results on Feb. 16. For full-year 2022, the company expects revenue to decline by 9 percent.

“While the full-year 2022, and particularly the fourth quarter, represented a challenging moment for Hasbro, we are confident in our Blueprint 2.0 strategy, unveiled in October, which includes a focus on fewer, bigger brands; gaming; digital; and our rapidly growing direct to consumer and licensing businesses,” Cocks said.

Hasbro had recently come under fire from fans after it attempted to rewrite a 20-year-old open game license for Dungeons and Dragons in a bid to boost revenues. Fans of the game saw the proposal as unfair to third-party content creators, which forced the company to postpone updating the licensing terms.

Layoffs, Incorrect Employment Additions

Hasbro is the latest in a long line of major companies that have announced layoffs for the year. IBM, for example, intends to lay off 3,900 employees, Amazon 18,000, Alphabet 12,000, Microsoft 10,000, and Salesforce 8,000.

A Jan. 5th report by Challenger, Gray & Christmas states that U.S. employers announced plans to cut 363,824 jobs in 2022, up 13 percent from 2021.

Meanwhile, the U.S. Bureau of Labor Statistics (BLS) seems to have overreported employment additions last year. According to BLS’s Current Employment Statistics (CES), 1.1 million new jobs were reported in the second quarter of 2022.

However, a December report by the Federal Reserve Bank of Philadelphia found that the U.S. economy only added roughly 1 percent of that estimate.

“In the aggregate, 10,500 net new jobs were added during the period rather than the 1,121,500 jobs estimated by the sum of the states; the U.S. CES estimated net growth of 1,047,000 jobs for the period,” the Philly Fed concluded.