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

Global leader in entertainment branding Hasbro The company announced a 15-percent reduction in its workforce, as well as the departure of its chief operational officer. It also projected lower 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. According to the goal, Hasbro is implementing “organizational changes” Hasbro announced in a statement that it will reduce approximately 1,000 positions from its global workforce by the end of this year. Press release On Jan. 26,

These new measures include changes in leadership and a new organizational structure. Hasbro will be discussing these details during the 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,” Chris Cocks, CEO.

The company announced that job reductions would be implemented over the next weeks. Hasbro stated that Eric Nyman, President and COO, is leaving the firm as part of these changes.

“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 and the Game License Controversy

Hasbro’s layoff announcement was accompanied by weaker revenue projections for fourth quarter 2022. The preliminary fourth quarter revenue for Hasbro is estimated to be $1.68 billion. This would be a 17 percent decrease from the same period 2021.

Only the Wizards of the Coast segment and Digital Gaming are projected to have positive revenues, an increase of 22 percent over the previous year. Only $1 billion is expected to be earned by the consumer products segment, a 26 percent decrease. The entertainment segment will see revenue decline by 12 percent.

On February 16, Hasbro will announce its fourth quarter results. The company expects that revenue will decline by 9 per cent for the full-year 2022.

“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.

Fans were critical of Hasbro’s attempt to revise a 20-year-old open license for Dungeons and Dragons to increase revenues. Fans saw the proposal as unfair to third party content creators and forced Hasbro to postpone updating its licensing terms.

Layoffs and incorrect employment additions

Hasbro is just one of many major companies to announce layoffs for this year. For example, IBM intends to layoff 3,900 employees. Alphabet 12,000 and 18,000 will be replaced by Microsoft 10,000 and Salesforce 8,000.

Challenger, Gray & Christmas reported Jan. 5, that U.S. employers had announced plans to reduce 363,824 jobs by 2022, an increase of 13 percent over 2021.

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

A December however, Report The Federal Reserve Bank of Philadelphia concluded that the U.S. economy grew by just 1% of this 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 closed.