Hasbro cuts 20% of jobs – Find out why the toy giant is in turmoil
In a stunning turn of events, Hasbro, the powerhouse behind childhood favorites like Monopoly and My Little Pony, has announced a drastic reduction of its workforce. The company, grappling with a persisting malaise in the toy business, is set to cut about 1,100 jobs, which equates to a staggering 20% of its total workforce. This news, first reported by The Wall Street Journal, emerged from a memo to employees, later disclosed in a regulatory filing.
Deepening Crisis in the Toy Industry
The nearly century-old Rhode Island-based toy maker is not alone in facing these challenges. The toy industry, as a whole, is reeling from a post-pandemic sales slowdown. Despite a surge in toy purchases during the lockdowns, the industry has seen a downturn in demand. Last holiday season, toy companies slashed prices to offload merchandise, a clear indicator of the weak market appetite. According to Circana, toy sales in the U.S. plummeted by 8% from January through August.
1,100 Jobs Slashed at Hasbro as Toy Sales Plunge Continues
Hasbro’s Strategic Response to Market Headwinds
Hasbro CEO Chris Cocks, in the memo, acknowledged the severity of the situation, noting that the market headwinds have been stronger and more persistent than anticipated. The job cuts, which come on top of 800 already executed in 2023, are part of Hasbro’s strategy to save up to $300 million annually by 2025. Cocks outlined a plan to focus on fewer, larger brands, gaming, digital initiatives, and direct-to-consumer and licensing businesses as a way forward.
However, the impact of these changes is already being felt in the financial markets. Shares in Hasbro Inc. saw a near 6% drop in after-market trading on Monday, reflecting investor concerns over the company’s future.
In conclusion, Hasbro’s decision to reduce its workforce by 20% is a significant move in the toy industry, signaling the depth of the challenges faced post-pandemic. As the company restructures and adapts to the changing market, all eyes will be on how these strategies will shape the future of this iconic toymaker.