Here’s a look at what to expect when Hasbro (HAS) reports Q1 earnings this week

Shares of Hasbro Inc. (NASDAQ: HAS) were down slightly on Monday. The stock has dropped 15% year-to-date and 20% over the past three months. The company is set to report its first quarter 2023 earnings results on Thursday, April 27 before market open. Here’s a look at what to expect from the earnings report:

Revenue

Analysts are projecting revenue of $878.4 million for Hasbro in the first quarter of 2023, which would reflect a decline of 24% from the same period a year ago. In the fourth quarter of 2022, revenues increased 17% year-over-year to $1.68 billion.

Earnings

The consensus estimate is for earnings of $0.01 per share in Q1 2023 compared to adjusted EPS of $0.57 in the year-ago period. In Q4 2022, adjusted EPS rose 8% YoY to $1.31.

Points to note

Hasbro’s performance has not been too great recently with revenues declining in the double digits over the past two quarters. The company’s results for Q4, which is also the holiday quarter, came below expectations. The toymaker has been feeling the pressures of inflation and this is expected to continue in 2023 as well.

Hasbro has guided for a low single-digit revenue decline in 2023 and taking into account certain factors, it anticipates revenue in Q1 2023 could be down approx. 25% from the same period in 2022.

In the fourth quarter of 2022, Hasbro saw revenues decline across all its brands and most of its segments, with Wizards of the Coast and Digital Gaming, and MAGIC: THE GATHERING being the only bright spots. The strength in these two areas are likely to buoy the results in the first quarter of 2023.

Hasbro has been working on its Blueprint 2.0 strategy, which focuses on bigger brands, branded entertainment, expanded licensing as well as driving high-margin growth in games, digital and direct to consumer. Updates on the progress of this strategy are worth keeping an eye on.

The company also continues to achieve cost savings under its Operational Excellence program, which aims to deliver $250-300 million in savings by the end of 2025. Hasbro remains on track with its plan to generate $150 million in run-rate cost savings in 2023.