Hasbro (NASDAQ: HAS) topped Wall Street expectations for its first-quarter results, posting revenue of $1 billion and adjusted earnings per share of $1.47, the company announced Wednesday before the market opened. The figures surpassed consensus estimates compiled by LSEG, which had forecast $964.38 million in revenue and adjusted EPS of $1.13.
The beat was largely driven by the company's Wizards of the Coast and Digital Gaming segment, where revenue surged 26% year-over-year. Magic: The Gathering, the flagship trading card game, led the charge with a 36% increase in revenue. The segment's operating margin reached an impressive 51%, underscoring the profitability of Hasbro's pivot toward games and digital experiences.
Overall revenue rose 13% compared to the same period last year, while operating profit jumped 58% to $270 million. CEO Chris Cocks described the quarter as a "strong start" to the year, noting that Wizards "continues to break records." CFO and COO Gina Goetter highlighted the company's "top-line momentum" and "disciplined execution."
Hasbro's transformation story is increasingly centered on its gaming and entertainment divisions, which now contribute a growing share of earnings. While the company still sells classic toys such as Play-Doh, Nerf, Transformers, and Monopoly, the bulk of its profit growth is coming from higher-margin categories like trading cards and digital gaming.
Looking ahead, Hasbro reaffirmed its full-year 2026 outlook, expecting revenue growth of 3% to 5% on a constant-currency basis. The company also maintained its adjusted EBITDA guidance in the range of $1.40 billion to $1.45 billion. However, management acknowledged ongoing risks, including cybersecurity costs and tariff uncertainties.
In late March, Hasbro discovered unauthorized access to its network, leading to a delay in the release of full financial results. The company has since contained the breach and is working with outside experts to investigate. While operations continued through business continuity plans, the final cost for legal fees, remediation, and other expenses remains unknown. Hasbro expects to file a claim with its cyber insurance provider.
Tariff risks also persist, particularly as the company relies on global supply chains for its toy and game production. The combination of cyber spending and trade policy uncertainty could pressure margins in the coming quarters.
Hasbro shares closed Tuesday at $97.18, up 3.69% on the day, outperforming the broader market as well as rivals Mattel (NASDAQ: MAT), Electronic Arts (NASDAQ: EA), and Take-Two Interactive (NASDAQ: TTWO). Despite the gain, the stock remains below its 52-week high of $106.98 reached in February.
Investors will be watching closely to see if Hasbro can sustain its momentum through the rest of 2026, particularly as toy demand remains soft and competition in the sector intensifies. The company's ability to leverage its Magic: The Gathering brand into a durable earnings engine will be a key test in the months ahead.
