Hasbro Says It’s Playing ‘Defense and Offense’ on China Tariffs as Stock Skyrockets by 16%

Gaming brand Hasbro delivered an exceptionally strong first-quarter earnings beat on April 24, as Sherwood News reported, built largely on the back of its Wizards of the Coast product lineup. Wizards is responsible for the production of notable properties, including “Magic: The Gathering” and Dungeons & Dragons-related products.

Despite the sunny earnings results — earnings per share (EPS) came in at $1.04, against $0.67 expected, and revenue was notched at $887 million, versus $771 million anticipated — Hasbro was reluctant to adjust its full-year guidance, even as shares of the company skyrocketed in early morning trading on the same day. As of 12:21 p.m. ET, the stock had risen 16.3% to rest at $61.28.

Hasbro Maintains Guidance, CFO Says Tariffs Could Produce $300 Million in Gross Impact in 2025

That reluctance to adjust its guidance rested largely upon the uncertainty of the current tariff situation outlined by President Donald Trump, per CNBC.

“Our forecast assumes various scenarios for China tariffs, ranging from 50% to the rate holding at 145% and 10% for the rest of world,” said Gina Goetter, CFO and COO at Hasbro, on Thursday’s earnings call.

“This translates to an estimated $100 million to $300 million gross impact across the enterprise in 2025. Before any mitigation,” Goetter added.

During that call, CEO Chris Cocks described Hasbro as in well-positioned despite the tariff situation, and that the maintained guidance — rather than perhaps a pullback — could be at least partially “supported by our robust games and licensing businesses and our strategic flexibility.”

“Magic: The Gathering” and Dungeons & Dragons properties under Hasbro’s Wizards of the Coast share a tariff exposure of less than $10 million, Cocks noted, while also allowing for the possibility of potential job losses as the company absorbs increased costs while attending to the needs of its shareholders. Most of the company’s gaming products are produced in Massachusetts, North Carolina, Texas, and Japan, allowing this segment to evade the bulk of Trump’s tariffs.

Hasbro’s Toy Division May Have To Make Major Moves To Mitigate Tariffs

On the other hand, Hasbro’s toy lineup is primarily manufactured in China, a reality which Cocks addressed by saying that the company is looking at moving production facilities out of China to mitigate the ongoing tariff situation.

The iconic Play-Doh product, for example, may see its production moved away from China to Turkey, according to the CEO. Turkish manufacturers would ship the product from Europe stateside in this scenario, but Cocks also noted that several other products — particularly those which included electronics, foam, or high end deco elements — would be harder to source outside of China.

“China will continue to be a major manufacturing hub for us globally, in large part due to specialized capabilities developed over decades,” Cocks said.

Price hikes seem eventually inevitable, per Hasbro execs, despite the acceleration of the company’s existing $1 billion cost savings plan.

“We are going to have to raise prices inside of 145% tariff regime with China,” Cocks said. “We’re just trying to do it as selectively as possible and minimize the burden to the fans and families that we serve.”

Speaking to the frustrations around a mercurial trade policy from an operational standpoint, Goetter framed the company’s troubles concisely.

“We’re trying to play both defense and offense at the same time,” Goetter said.