Hasbro's Wizards of the Coast Division: Tariff Woes and Soaring Sales
Hasbro Seeks Tariff-Free Toys due to continual sales of Magic: The Gathering Cards
It's been about a month since the Trump administration's tariffs took effect (and partially reversed), leaving many companies in the lurch. Fortunately for Hasbro, the toy giant isn't one of them, at least not significantly.
During a recent investor call, CEO Chris Cocks boldly declared that Hasbro is weathering the global trade storm quite well. The digital and domestic nature of its games business, along with the domestic manufacture of its board games under the Wizards of the Coast banner, makes them relatively insulated from the tariff onslaught.
Wizards of the Coast, the division responsible for the evergreen tabletop games Dungeons & Dragons and Magic: The Gathering, has minimal tariff exposure. The majority of its domestic supply is stored in Texas and North Carolina, while international manufacturers are based in Kyoto, Japan, and Europe—two regions currently exempt from tariffs.
While China remains a significant manufacturing hub, particularly for D&D boxed sets, which are the only Wizards-related imports from the country, the overall impact on Hasbro is relatively small. Cocks admitted the company has been juggling more complex logistics, but he voiced hope for a more predictable and favorable U.S. trade policy environment. Hasbro strongly endorses the Toy Association's call for zero tariffs on toys and games globally.
Tariffs, as Cocks pointed out, drive up consumer prices, pose potential job losses as the company realigns to accommodate increased costs, and threaten shareholder profits. Though Hasbro's guidance remains unchanged, prolonged tariff conditions could create lasting structural costs and heighten market unpredictability.
For the moment, Hasbro is focusing on its Wizards products with a sense of optimism. The card game Magic has been seeing a surge in business in the first quarter of 2025-2026, which Cocks attributes to the game's continued strength in licensing, particularly the forthcoming crossover with Final Fantasy. The Universes Beyond set will hit the shelves on June 13, and pre-orders have already made it the best-selling Magic set ever.
In the bigger picture, Hasbro is keeping a watchful eye on tariffs, bracing for various tariff scenarios, and leveraging its scale and strategic flexibility to navigate through the challenges. With Hasbro's leadership emphasizing the damaging effects of tariffs on consumers and supply chain logistics, there's no denying that the company prizes a future with reduced trade barriers to maintain competitive pricing and operational efficiency.
Insights
- If the 145% tariff rate on Chinese imports remains, Hasbro could face a potential $300 million hit to its bottom line in 2025[1].
- The company anticipates responding to tariffs with price increases and is accelerating a $1 billion cost savings plan to help alleviate pressure from tariffs[1][2].
- Prolonged tariffs could lead to potential job losses as Hasbro adjusts to cope with increased costs[1][2].
- Despite the challenges, Hasbro remains optimistic about its Wizards products, like the upcoming Magic: The Gathering x Final Fantasy crossover[1][2].
- Hasbro's stance on future tariffs reflects a tactical approach aimed at shoring up competitive pricing and operational efficiency despite tariff uncertainties[1][2].
- The card game Magic: The Gathering, under Hasbro's Wizards of the Coast division, has seen a surge in business, with the upcoming Magic: The Gathering x Final Fantasy crossover contributing to this trend.
- The toy giant, Hasbro, is optimistic about its Wizards products in the future, but is also bracing for various tariff scenarios, as prolonged tariffs could create lasting structural costs and heighten market unpredictability.
- In response to tariffs, Hasbro anticipates resorting to price increases and is accelerating a cost savings plan worth $1 billion to alleviate pressure from tariffs.
- If the current 145% tariff rate on Chinese imports remains, Hasbro could potentially face a $300 million hit to its bottom line in the year 2025.
