Afterlaying off 800 staff only earlier this year,HasbroCEO Chris Cocks has announced plans to lay off a further 20 percent of the company’s 6,400 employees.
“While we’re confident in the future of Hasbro, the current environment demands that we do more, even if these choices are some of the hardest we have to make,” Cocks said in an internal email (as reported by theWall Street Journal). “I know this news is especially difficult during the holiday season. There is no sugar-coating how hard this is, particularly for the employees directly affected.”
Chris Cocks made $9.44 million last year.
Hasbro laid off 800 people back in January in a bid to save $300 million by 2025. However, Cocks says that the “headwinds we saw through the first nine months of the year have continued into [the Holidays] and [are] likely to persist into 2024”.
The email ended by saying that laying off 1,100 of the company’s staff was “a last resort”, describing it as a “lever we must pull to keep Hasbro healthy”. It’s unclear if this will affect Wizards of the Coast, who ownDungeons & DragonsandMagic: The Gathering, as WSJ reports that the decision was spurred on by weak toy sales during the festive season.
“We entered 2023 expecting a year of change, including significant updates to our leadership team, structure, and scope of operations," Cocks said. “We anticipated the first three quarters to be challenging, particularly in toys, where the market is coming off historic, pandemic-driven highs.”
Following the release of Baldur’s Gate 3,Hasbro saw a 40 percent rise in digital revenue. Wizards of the Coast and Digital Gaming is also Hasbro’s best-performing segment, with revenue up $120 million last month (as reported byWargamer).
Cocks also stated that Habso has already notified employees who are being laid off or that they will find out within the next 24 hours. This news comes just two weeks before Christmas, with layoffs taking place over the next six months.
Following these layoffs, Hasbro expects to save an extra $50 to $100 million, bringing the savings to a total of $350 to $400 million by the end of 2025.
Hasbro’s stock dropped by 20 percent on Monday, and with toy sales as a whole going down in the USA, its expectations for the Holiday season are also in decline, with projections of a 13 to 15 percent revenue drop.
“A year ago, we laid out our strategy to focus on building fewer, bigger, better brands and began the process of transforming Hasbro,” Cocks told staff. “Since then, we’ve had some important wins, like retooling our supply chain, improving our inventory position, lowering costs, and reinvesting over $200 million back into the business while growing share across many of our categories. But the market headwinds we anticipated have proven to be stronger and more persistent than planned.”
