Hasbro’s Wizards of the Coast & Digital Gaming Segment saw revenue increase 22% YOY in Q4 to $339 million. For the full year, revenue in the segment was up 3% to $1.33 billion. Operating profit for the segment was $538 million. For 2022, Hasbro saw overall revenue decline 9% to $5.86 billion.
Analysis
For years there have been attempts by toy companies to find synergy with the video game business. This includes not only Hasbro but Mattel and Bandai Namco in Japan. Bandai Namco has done well but Mattel and Hasbro struggled with their video game divisions.
Now it looks like Hasbro is having success in digital games by focusing on an older audience that is growing the tabletop/board game market. There is increasing synergy between video games and sophisticated board games that appeal to a teenage+ demographic.
Last year, Sweden’s Embracer Group bought board game company Asmodee for $3 billion. Many major video games now have licensed board game versions. Popular board games are increasingly receiving digital versions.
Most of Wizard of the Coast revenue comes from tabletop games, most notably the Dungeons & Dragons and Magic: The Gathering franchises. This accounted for $1.07 billion of 2022 revenue. The digital gaming versions of products like Magic: The Gathering Arena, an online collectible card game, brought in $258 million. This was down 23% over 2021 when the mobile versions launched.
Overall the market for sophisticated digital versions of board and card games has substantial growth potential. For Hasbro this could be a high growth/high profit segment if they play their cards right.
