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Hasbro (HAS)

Participants
Brian Goldner Chairman, Chief Executive Officer
Deborah Thomas Executive Vice President, Chief Financial Officer
Debbie Hancock Senior Vice President, Investor Relations
Arpiné Kocharyan UBS
Stephanie Wissink Jefferies
Michael Ng Goldman Sachs
Felicia Hendrix Barclays
David Beckel Berenberg
Jamie Katz Morningstar
Tami Zakaria JP Morgan
Drew Crum Stifel
Eric Handler MKM Partners
Gerrick Johnson BMO Capital Markets
Priya Ohri-Gupta Barclays
Fred Wightman Wolfe Research
Devin Brisco Bank of America
Brett Andress Keybanc Capital Markets
Tim Conder Wells Fargo
Call transcript
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Operator

Good morning and welcome to the Hasbro second quarter 2020 earnings conference call. At this time, all parties will be in listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star, zero on your telephone keypad. Today’s conference is being recorded.

objections, disconnect any this have you you at may time. If turn time, over I’d this the like At to call to Ms. Debbie Relations. President of Vice Hancock, Senior Investor ahead. go Please

Debbie Hancock

Thank you everyone. and morning good

take Chief Brian Joining update morning Today on questions. and to commentary we your Brian response Hasbro’s Goldner, on Executive with Officer. Officer, the begin the then Deb Hasbro’s Chief me company’s Financial and are we COVID-XX an Chairman and this will the Thomas, Deb performance will and pandemic, providing company’s

Our website. and today’s adjustments our information earnings slides are call for non-GAAP measures. release and The presentation posted on and regarding presentation investor non-GAAP financial release press include

included today A EPS, release diluted and in these discuss will whenever share. measures adjusted presentation. non-GAAP Please call note reconciliation which discuss or to adjustments. GAAP earnings share that earnings per exclude to per is the Our of we we press certain measures referring are non-GAAP

date children this Before goals, we among the forward-looking impact similar would remind the answer like wellbeing results forth annual differ factors efforts forward-looking and actual times. materially to concerning many question made would may financial call. in include expressed in to support or begin, These most These statements to to results to these that matters. customers, the and now release occurring I circumstances and events others, of XX-K, that workforce, report introduce could expectations, Brian liquidity, members on or management’s their press those initiatives our any of management difficult that to communities, of adequate statements call after statements the expectations forward-looking liquidity, this and and make Hasbro are and cause objectives and these our during coronavirus undertake I health set our ensure session to and disclosures. follows, Form our There other our families from our our on efforts include, today’s during results in We other manufacturers and the our to you anticipated of suppliers, and protect business, our workforce, XX-Q, reflect Goldner. global our Brian? today the no statements. consumers, we including or have factors obligation public update recent events like

Brian Goldner

morning Thank thank Debbie. you joining today. Good everyone us for and you

experience, continue execute holiday season. and to teams the to across evolving. working in rapidly address capabilities toward has challenged and this global quarter distance and pandemic in making are ways we’re Our we our are third significant businesses a global at data, well They us, are headed progress good that insights leveraging which while this

also Our belief team over in year. as the we years during this few this intensified action challenging Hasbro the next opportunity for has in see

unfolding unpredictability, of line expectations deal great a with far so is there last is quarter. shared we the While in year the with you

from progress, is be impacted we the improve the the production, our and are to to party as second closures factories, retail, entertainment evolving third quarter second but revenues. in many around which The expected quarter exist third our expect experience of in negatively we there believe situations at We and quarter world. that most make will difficult

believe marketing what strong a products support campaigns launching can innovative season. to and executing holiday are we new we successful Finally, be

you community. on four Iiquidity, in the we a April: focused key grounding remain areas and demand, we principle, with As supply, shared

is below much to second has months, of approximately European out we dramatically. began content XX% at peak. was more several record has in of across levels. by globally. down in the quarter increased brands Latin where as levels. closed are doing demand, to Hasbro certain in single stores digits reopen enter These and the ability quarter of changing in XX% XX% array closed We Foot be them countries in greatest at traffic brands. on open. consumers to our recent at an we In based America, open retail of where Engagement with even of number with and content the point-of-sale seek and closed. remain are are we as impact broader continued the increased stores cases our at approximately retail the XX% stores the percentages third business as or globally strong the keep continue Today, high high Global Looking our economies

America the We in Globally where percentage us as business XXXX online. expect small COVID-XX ecomm represents given the the brands impact expanded consumer Hasbro points. executed grew revenue nearly toy want. a rapidly for game At of will has the region quarter, the by in and Latin of ecomm’s revenue it percentage of and difficult the XX broadest they nearly be of access share XX% our to

to on were organization building ready this shift been many for years. capitalize Our have teams a digital-first investing as we in

to our to flexibility the furthered consumer they and great shop. exhibited we meet creativity time, this During capabilities want and where

Sentinel. addition omnichannel something our XX Marvel successful Earlier and X-Men quarter to which implemented a in campaigns, brings threshold the and what exciting project hit week successful than love. new strong each Legends from for about In pure and and after $XXX XX,XXX Hasbro channel funding Fan we our they HasWeb including more most Pulse, play had quarter, now record the fans brands DXC has and this results Friday It collectible every launched ecomm, item. backers hours First our a days XX is ever,

over remains still ways In production revenue the Doh, growth we but in timing saw which number, discussed last disruption family get for the is Play holiday. for impacted supply the our will for and impacted half the second quarter began mid-March the Europe, Demand half relatively small we certain and of weeks due POS but global Pulse below games POS ability the a Nerf second our for caught strategy shutdowns mid-May, with to quarter pivoted is quarter, on fans increased connection quarter. up of consumers second fully demand we expect out quickly this later In-stock and fun have for Production month also and our limited strong past to be Play about ready several during this to product levels our as games lasted year. grow to capitalize our looking double in to for our and to meet the While the shifted digits, later powerful active. and launches the and about thresholds and some outside of were coming U.S. a normal time. delivery Doh India.

closed, declined. more other In the inventory model the in XX% of will inventories retailers requirements were our be U.S., Similar their retail and digital-led as of believe or retail high full addition, about teens, In We moved about the continue shifts represented a to ecomm markets. to in model weeks digital with today inventory. occurred seven year stores reduced forecasted which revenues.

good confidence year, game exhibit and season. the believe plans gauge are to versus consumers retail our give shoppers to consumer joint to some a retailers in the and us return they undergo ability filling also industry We a caution stores. and our very which continues and shift deliver category Throughout our retailers holiday markets with to well we our may toy have partners and supported as positioned. reopen The rate this at fulfilling stores, demand

lines, play much is the from as for with up performing Mandalorian, new and and as revenues than consumer for can well and anticipated the momentum and expansion The brand product good gaming half as Star all new and behind Gathering releases I initiatives, have here, both card and China. including brands cover Wars, arrives analog retail arrival the The animatronic series, new Magic for Magic Gathering many X the new the year demand including overall the and more good have Arena the Child strong Disney’s down were a forecasted. second edition in have of the in into in of and well to quarter mobile holidays. set where great the Plus the We Frozen of properties Lucasfilms products Nerf, seen Disney featuring the digital

Moving now position. supply chain in is to supply, our good

up demand catching have production our to half factories. by latter the were and third We early we returned on locations quarter. caught in factories other China quarter this anticipate up in of in party second

our the year re-forecasted operations global diligently shifting footprint, mix has changes based where have team worked maximize production and to global on to to Our and the other feasible, locations timing.

financial $X our Next, just and liquidity. a we balance cash in on position ended Hasbro is with strong sheet. billion quarter the in over

billion $X.X of and line credit remains available accessible. revolving Our

some where continued, have we operate, in business to cost shutdowns including decisions difficult simplify areas our we employees cannot the commercial have the and to out of making As currently furlough organization. taken

EX production side, On the is returning. gradually content

$XXX developing spend good and year, our My cash including series IP to is being on approximately now film and successful for and for virtual of Alien develop feature PJ animated the Mask, million. and be to unable million this result content strong also XXXX. $XXX but deliver and our a to will We’ll XXXX the this produce content our plan, and to shift EX revenues complete Demand team into some is projected produce is TV continued Netflix, a Peppa on and over a We to Hasbro con Pig, IP. film. content slate new content XXX doing XXXX new TV, Pony Little projects, executing XX work and launched new for new and As

teams, entertainment our remain businesses, XXXX. our combining track and the integrating million to progress great made $XXX on by have in products and including deliver consumer year end synergies We

Hasbro unlock value of new entertainment around opportunities as are we IP. long and Importantly, working to commercial we develop term organization the the

Finally, community.

families a applied racial focus our looking never company in to communities expertise our critically families to committed Our that providing our our world honestly. as make the important. their around all well ongoing We’ve We difference meals, injustice, brands, better during and organization to children the been and as and belief to and materials more worldwide learning listening to make resources deeply this help global ourselves those for within a dialog continued using all in has to Hasbro to this need. philanthropic belief bring initiatives most children our by around the place and across and support on purpose world. crisis and local remain our our has

difference never from in fostering a culture to our make to position of While answers, the the minds unique earliest committed Hasbro, world. help influence have hearts to a the we more our a and age. shape and we inclusion are don’t entertainment our At brands, in and we been all using have

fandom robust the going We consumer the our done on remained and We’ve plans year the childhood, next that gaming in of agility world strengthened help generation innovation the and turn a our and themselves consumer and rethinking being to comes see our to is market, worthy. brands. now have privilege forward. initiatives and as strengthened feel everyone they digital they new irrespective in believe in matter, in speed their launches initiatives is are to to increased screen areas changed every across skin. set top, and shifted play digital Hasbro path to consumption Deb? everyone execute a high the teach belong toys I our and adapting and of privilege globally. want entertainment footprint. next and inclusion to deliver inter-generational things by entertainment over We Deb. EX year, kid to and We’ve and Making of foster to our of consumer, their and retail a have how digital-first multi-channel I’d this like a the our and to we’ve invested legacy. we our new of and and to purpose products. Hasbro partners, and line-up is XXXX the entertainment that like play with feel and in leveraging interest gaming call strategy our part equal past difference we’ve hero, We’ve that the responsibility our and innovation, a With global content, to table games, and from we and across of strong approach color

Deborah Thomas

and Brian, you everyone. good morning Thank

have teams we’re global together As operating from XXXX a and Brian our strength. position of in come said,

content, and quarter, last that a and year extremely second shared those cadence until team’s with could not retail production timing, on and reassured a second by revenue the during forecasted by of reduce last the quarter, entertainment the We We XX% quarter be release the and third shared would fruition. quarter, profitability times. up come closed challenging. ago and to was to we and to Magic difficult during Gathering due demand creativity tough but agility by ability live our our saw strong for the would our action to would cash, you these quarter expenses based we As manage our comparisons that challenging, realities and return have be our are quarter products

has year, should we quarter as forward analog is and execute entertainment meaningfully stores in to our begins of the back production we reopen, for digital, recovery of the plans improve and meaningful second road marketing Going quarter. believe performance return, beginning the Magic the the and the third from half to launches

or will positioned and tax one-time impact will $XX.X The ability forma good $XX.X associated severance discussion to where continue be after expect million and have million returned. reflected and businesses economies season. the We with factors amortization, expenses, important outcome. and be acquisition-related for acquisition versus production and a exclude share $X.XX and EX of in amortization. ultimate be approach $X.XX share, keep and go-to-market of stores of our per XXXX In severance per holiday to expense product and reopening we our today them tax open both for film an earnings simplifying operations year’s our entertainment TV reported after adjusted and expenses My numbers, of pro or not

year and and operating cost with track one-time we $XXX of XXXX approximately for the to recognize like synergies plan in-source planned to of recognizing These continue properties EX the by target includes Hasbro cost not synergies expenses, integration on and to COVID-XX. before is more business to overall original business benefit our we of XXXX. million $XX to remains games in This million due XXXX EX EX the savings Our toys savings. of increase as begin are end

begin I organization focus will community. We continue to liquidity. our supply, around and demand, with liquidity

revolving substantial quarter and the with sheet liquidity, our $X.X billion have credit available We through billion in facility. the over $X balance on ending cash

within covenants. are our financial We well

our the coming customer peak of time delayed. customers some receivables our the closely working second Our and Throughout collections. certain in last Since remains and cash, quarter, closed expenses ahead, markets we’re October-November channels, certain collection have managing remain our capital we period frame. the reduced in is quarter including and

improvement with period. We successfully and navigate stores customers this working are reopen to these seeing we’re closely as

XX the period days pro in a to year. last DSO result, a As from on forma increased XX days basis

Second include $XXX quarter associated EX. million XXXX with receivables approximately

COVID-XX. as Our production cash is spend on been has limited content due to this reduced year

initial million which For elimination, investments delay $XXX $XXX plan a into to million spend and we’ll in reflects approximately year. the the within reschedule revenues full expectations as year, of content these XXXX we making and productions million, range to to in our for and This is below XXXX. $XXX drive an a we spend, develop be not

development half million $XXX our products is capital with first first the the to and approximately year. this expenses small over largest of also in update, are years. Inventory the X%. Our including quarter digital back is in inventories EX. year the constant year, contribution million item gaming we’ve future basis, amount a $XXX relate timed essentially expected On capitalization million our to dollar year, in to be for line reflects launched up of spent flat $XX were a approximately expenditures to year. of the to and Tooling the half from This games be remains

is commentary. on Our next Brian’s demand. focus I’ll build

segment, ecomm. a penetration declined were also on gaming not closures, brands, did Wars second meaningfully of ecomm higher the Hasbro due and and ecomm lower consumer the shortages Both expenses, as gaming reported in high a last Similar versus more the international store the certain result lower loss entertainment, closures, Gathering declining inventory shipments an year omnichannel and by to inventories. and negative the Select retail notably these declined closure Latin chain year Despite low and product we closed during very XXXX retail and up U.S. U.S. segment, America impact to the the temporary were segment do. growth In products, with Magic In region a not XX% of of late revenues, in temporary than revenues were continue up declined FX. mix segment, operating and Backflip rapidly. has increased the consumer the started Revenues retailers Canada retailers in partner lower XX% offset to product and point-of-sale licensing due segment of quarter, quarter. including lower translate teens well. and region revenues. and pure in The licensees and the most absent have operating segment meaningfully. and impacted lower with revenues growth For revenue brands profit U.S. play partner ecomm expenses. revenue in International Canada lower we of revenue. as revenues that the X, be access as operating the from retail the partially grew declined profit all our revenues and to retail the to revenues, as In lower Star as lower the quarter. and store estimate to were Many digital many Frozen product XX% impacted shortages, grew. each Studios the down inventory supply

this lower advertising profit demand by live the year versus increased segment and content remains on lower the and Magic QX. due Operating the part EX In high, by along and the while production this delivery, expense closure expect improved expense hampered to royalties, quarter in due to the last events. program be Gathering action part in and will due program lower is consumer additional this sales, and also impacted with the lower to of revenues period in production expenses in consumers limits of launch Arena. segment, Backflip live We revenue advertising Studios advertising business year’s Profit last. amortization, for product

at look let’s supply. Third,

factories in last second in-stock delayed of quarter the production delivery quarter, launches. our during certain levels, shutdowns in As we games, and half most notably second impacted XXXX our the outlined

of ensure were China, quarter. and targeting production and operating, were the back during depends note adequate to is is continue area this increase freight open, the factories cost and in levels. the versus this to closed is the we This Production much will are of for freight air product is and be quarter back can up substantially Should staffing meet Ireland, our to in year factories able part period, costs. demand teams up. One India or to the XX% of being caught production the represent While air on which of third last. the U.S., latter holiday at

and experience each we community, and with for recognize uncertain focused operate we team’s a other teams safety, what what path a to great continue help period. in There support learnings we the As chart remain and this our provide and which on ingenuity very for operating. to our we’re how for are and years tremendous our close and wellbeing, They and company during our define communities job to resolve which will are do from health we challenging forward showing come. is

by due sales of to a at EX program allowances. Bad higher have of the spending promotional me for margin demand with to The Before delivery all also holiday. meaningful both in of aligned business freight production on driven the by consumer shifted demand We’ve environment reflecting program as let plans of $XX basis regions, a about including was theatrical sales for the current undertaken warehousing. cost up cost was drive product as but reflecting content commercial reflect $X on pro driven expense few XXX amortization Gross of expense advertising the the to by items releases touch cost our SD&A combined initiatives margin million, savings debt savings the our reduction and current the environment. we lack a commercial including advertising higher promotional was spend across somewhat and questions, we’ve lower within well open points, million lower decrease the in timing down increased amortizations, and mix, basis. businesses. across forma and offset

in In higher policies on fixed, XX% dollars admin the of in remains by approximately is of see this a brands we the percentage compensation and costs the and EX. As are and What year demand cost quarter, to while SD&A, uncertainty first robust stock our a continue the underlies expectation. in marketplace alignment for Within we revenue. accounting capitalization developing content resulted anticipated, deal great as execution that strong our resulting the closing, our of consistent a for the global there fluctuation has global in teams. of as been

We and and our execute ourselves holiday positioning drive to beyond. in to business a are XXXX season good

Now I questions. happy take are and Brian your to

Operator

first Our instructions] Arpiné from line question UBS. [Operator is of the with Kocharyan

Arpiné Kocharyan

you very much. Hi, thank

a could resumption just be it back majority open, total. and has digit percentage by that is footprint of in of means half? continue like license terms perhaps delivery I also you implication that on tied be shutdowns, Could You what consumer there your to toy expect Could that to and still in shipments mortar retail remarks. and the brick revenue of indicated single to understand of release partial revenue legacy for you from that mentioned in the the you and extent prepared guess EX the of of perhaps know clarify but impacted you content clarify I the side? sounds production, what business, to I impact, on

Brian Goldner

morning. Sure, good

again, you’re start and on Angeles production First commence Los to of - and waiting here to States, the Canadian we’re to right the the particularly particularly productions we’re produce the areas in we’ve to other be in able EX, focused market where the able United on in begun and U.S. area U.K.,

XX%, in about of gets clearly our plan for wanted QX of half about business, of as rest well. well highlight executing ecommerce XX% to want we business our that wanted ecommerce the at for below more of of percent of global it highlight just the the and part India America had a has get less of the in from impact Latin size and to to ship have fact, As third so will wanting business Latin starting which just a is American an of some come were - clearly we we’re and the more to there globally. Clearly new out that COVID-XX than our that fact so about to somewhat closed, the year, will look that retailers remain us the to lot ship, for QX. globally, in we Then clear, and production make not items, coming as that able were we initiatives, we to Nerf or where we quite to in QX second

We’re also catching up U.S. in the

where strong of you that very initiatives. array of Irish are closed to think lots Dungeons overall that into continues Doh Massachusetts we the Play Wizards there’s holiday again If good about and with the expand very Coast of from Dragons and made about moving and strong Magic factory, our well products continued and the feel plans about a games as from to catch-up many a new was mid-March good period, as across QX, but Gathering and very factor, and mid-May, of season so and POS, the broad then for about

Arpiné Kocharyan

spend helpful, it XX% you. on side revenue on more down sounds it EX the and is also XX% on than year basis, that so things down it fair media X%, slight in revenue was say some for and production to from terms the year? year shifts, full you for mentioned is cash content of EX, a thank in QX a That’s of like Then about lower further the is

Brian Goldner

of the that restarting and different production. had number just been What sold a world of to at shows around of so EX has production, platforms, looking commencing we’re now matter it’s the a is

or many those we’re calendar don’t of if episodes recognize our Deb, which XXXX further? Some the of whether we of has want fiscal, this revenue episodes with or is to the primarily. will just do revenues to in period, deliver how comment able you deliver to and difference the the episodes know the then whether year, delivered XXXX get I XXXX when in course we fall

Deborah Thomas

are bit certain be a actually down just of we to spend The Yes, production. a slower exactly Brian. in because complete cash return seeing that able is markets to

a may delay - that, at in when revenue able XXXX transfer just episodes. into to we’re the we it’s to the delivering it. live action As look about a it’s think complete the and Particularly really actually delay as

Arpiné Kocharyan

Thank you very much.

Operator

is with from the Wissink Jefferies. proceed your next Stephanie of Please Our question. question line with

Stephanie Wissink

everyone. good morning Thanks,

I’m the total us mentioned and you. We that’s questions. supply channel-level ecomm XX pretty you mix about you you in in next as is of much march a a half you about of of I about the some if the the should so around of toy mentioned housekeeping think you scope percentage the so ecomm. the in under-indexing missed the Brian, One can have to inventory year. ability in EX of over think maybe demand? the wondering regions, how a Then the XX the recoup just just world is How about LatAm can penetration. talk think side can and what has to think, significant in two question. recover understand you just of as opportunity build bigger that first question have terms you we in picture my much - big Brian, seven we in back into in both and channel low, of course the Thank curious weeks back on half weeks.

Brian Goldner

the yet in about about percentage try that We good that you but XX% that’s it’s go effort recognize retail we as ecomm. in of ago, but by of grown and business total about it’s revenues, of coming trying Asia done done ecomm, Steph. That’s only and U.S. is right there, the done get the tracking XX% thanks ecomm our points third so to channel of In well. is is a predominance job in team globally, so stores. and Europe, Latin world about we’ve hay year built about omnichannel. in versus very make the still business a a with to has represents XX up an where are ecomm great from to business XX%, America, Yes, capability In region, the a around if now it substantially

expect our proportion As fourth the as are we strong teams high we fourth and that be for sales; to our As have third go into continue products for is we could the initiatives, the a toward year go further, typical, high--that we to quarter, as and in demand. quarter fact, the around of and and prepared look third half ecomm we even of very second increase

say and stores reopening retailers our sold a been we point, so major they are that goods, to better why Those around and retailers seen just demand the represent Our strong retailers have Nerf are and they there have, year seen sell-throughs know down similarly. also saw and the in at are is reopening U.S. even every decline. games just throughout over particularly Doh sell-throughs, and of specialists. just XX% taking average particularly about we’ve essential of that the that’s Europe, further weeks. really the that but inventory particularly to overall the top as six and but strong is in retailers in with we that We’ve represent our world. closer very retail business reopening, double-digit U.S. eight three than our retail so under business as performed of opportunity Play I’d high as last view POS think say recognize that we very in this have I’d we our stores, XX%, very I the top that their advantage toy revenues we we customers some inventory some down in XX% total increases, open

the of reopen in other and momentum particularly inventories our in are We’re markets, and - Pacific a initiatives. new we U.K., places point year the launching half was in sale about to rebuilding It very of are new seeing for the but Asia good up strong the China, rather they as we like Australia, shipping the really first and what that lot of extent available recent isn’t in initiatives the France Europe second teeing are half. what

demand a to very brand our we’re around come a that’s product Ultra where across example, true will Nerf, out and have around businesses flyable and where like line-up and world. robust really lining for the the We satisfy new consumer others, elite world, brand up line-up the for exceed product,

Stephanie Wissink

Thank you.

Operator

is proceed Sachs. Ng Our from your with next with the question Goldman Please of coming questions. line Michael

Michael Ng

have two. just I Thanks.

First, clarification have up do you on late Then I the the was follow-up. quarter, production the like have I XQ. that much into ask there because better wanted yet How are catching some to supply quarter visibility by quick feel third headwind fulfilled? be second just around comments orders chain your you about and missed for to in written a have

Brian Goldner

it’s right. Yes, exactly

product, of We’ve Child and our Mandalorian products seeing initiatives. the line-up We collector across demand brand Begins. new coming a launching Dragons Operation brand very for Monopoly lots whole strong season Star starter half new the [indiscernible]. are game business, the the in of lots new half. of strong of Dungeons the got Hasbro the Hasbro and performing games brand-new brands year I a line-up second second addition and number a other gaming, the of Similarly, Ultra been a but beer second Nerf brand there, the pong, new across of also set, got launching that really Adventure in initiatives Wars We’ve gaming, has new we Nerf Pet quite for described, strong coming, new and Scan, but Star including sales The Wars. well, very have demand

plans we QX. have go our into consumer quite QX good and visibility So through demand to we robust and retailer are as

Michael Ng

It pull table was about. question seemed my that and like some of second meaningfully on you appreciate I top, quarter. are can Magic. was and in the XQ comps the were top in well and to year-over-year those year-ago there are probably forward spoken seeing guys there Could back you was you unique down hobby about stores difficult Great, the as those you. reopen? impacting Are the table hobby stores things as renewed store demand that particularly half, the reopening closures? Thank talk just had

Brian Goldner

our about plan belief business. size full we and much Yes, double and Magic XXXX The engagement very headwinds shipments were with XXXX quarter are Magic’s the Wizards with can that still this the in ’XX, period XXXX, over been in has to of strong. quite the the five-year line year from really that plans

While to in the QX, make early was QX. the we did card release drive year in cadence in less more plans

more just store that seeing set expanded and was QX. plan by a Play digits stores for double and network have Wizards QX so July. In for quarter, The we’re QX, launched We in has in a the coming, have core big early reopening. we

in We later saw. is QX. going due was we in XX, QX, to comparable big play very that Magic the the a set booster we that challenging jumpstart challenges for us. set release June set the was launched be production jumpstart have August, that to to Horizons and that a that a XXXX, The Modern strong. set and for that’s scheduled July, very Despite postponed in a had situation, launched set planned is for originally was XXXX QX In in but July we the

X.X strong of see Behemoths, sell-in even tied Lair we’re a weeks with actually where the early spring filled mention which look Arena on we nine brand, X.X is over the partnership was to in billion is is the platform which mobile, spending up the up did from storytelling Magic and we end at bestselling for that ago. still for also XXXX the though spring and period. of players of and to releases demand for play Arena seeing is which and all the all the time, Magic other top also the set hours very announced we total played the are The fact, had yet into the In and at very less of was going games as their quarter releases is core Arena Remember, rest revenues as would in QX, Also, everything and average, good about we more set high Ikoria: Arena, is coming with Magic XXXX played of global in moved couple table launching is in billion styles. China that a of set and Tencent. to all week interest of most just in early and different players launched QX. course down about be

the So always was QX good so substantial. a Magic, for QX quite again, in business. headwinds major year Magic the very It’s about were biggest last fact, we tracking We’d as described quarter feel headwind; last point, the well.

Michael Ng

Brian. you thank Great,

Operator

question your with Please line the of Felicia proceed Our from Hendrix Barclays. is next questions. with

Felicia Hendrix

a Brian, Hi, us to through thank you’ve the of and half seem of you you kind so feel morning. lot already much, and better good first. walked things about the second than

us store and the quarter, product the and you supply then through to could what chain help that of trying areas understand attributable to parsing also that issues, by were were. just wondering Just was understand much just different closures shortages XX% decline how if affected

Brian Goldner

Yes, sure QX excellent to of priority the that during number time doing teams are for is, focus so wanted most important to remained was operating make on the safely. work. safe and that related our We course, one to factor COVID, they and

last of about Marvel ago the also headwinds COVID, retail a lot mid-March is I there had and Star closed, warehouses there’s for know Avengers last the which and in Magic we and Frozen, Spiderman’s Irish, which Then conversation headwind that During up movie, the business, that’s QX. Massachusetts India progress by but July and around closed been we Gathering just Marvel substantial from quarter as that as biggest second time on are Wars closed was have year. with the remember was gearing U.S. impact described, the came so a as a quite mid-May, in I far. good QX, to had we also we factories we of last but also We XX% of well year. Endgame quarter in on appropriate, year but the were looked, seeing

feel domestic the We good those we’ll able India be products are and are also is marketplace. get Demand shutdowns into up warehouses very have factories has back now and and that strong. short-term our incredibly There some been we happy very that open, to producing. remained restrictions, but

you that If brands’ digits. as up it’s year rates date, our the POS is growth well. look share in NPD. around single up were That’s globally, high Hasbro consistent from the holding quarter POS globally seen and the industry to world with at franchise we’ve its

XX%. for--consumer quite for encouraging. Of demand were course, demand global The by is more games than up products

all of may As to we half meaningfully up is good was we second better reason missed very for the season. fact we make not holiday will QX and described, a the QX to expect in what get year, have be than QX of while we

Felicia Hendrix

there in you? surprise a us family Great, bit that’s just detail and brands just the that and through walk helpful. moving relation Peppa YouTube for Then quarter, a to in in to and happened you super the was more little can advertising, what

Brian Goldner

what around couple really--a Yes, we family brands. saw things

licensing very strong First, programs, had revenues quarter it’s QX Peppa we remember Pig so our receive in the and in arrears, China recorded in after. licensing always

we’ve challenging seen views, is in closures. was reduction PJ preschool in XXXX, market puts regions closures consumer Peppa challenges was is number some that due which but around in changed holiday of Masks, recent China, some Hasbro there what of still see of the We and China, there, As off world in compare add China, They they one in The products lot new coming seeing licensees happened going to and some We features, YouTube, the the that is to of did IP and is there’s the was a challenges products in year spots consumer YouTube, manages year team our primarily and our content YouTube again all first the did in which reductions which what advertising. algorithm Then consumer some was all this deals be advertising with way on due viewed we the but internally of down just different year a COVID is now and product been the saw reopening. takes for positive. last again on brands property a YouTube there. the are quarter several, in China presented. on including as billions had more team bright now so to now

Felicia Hendrix

much. you so thank Great,

Operator

Thank you.

Please line from Berenberg. your David question the with is next Beckel Our proceed questions. of with

David Beckel

two, if thanks Hey, questions. I much the I could. for so have

help a you now, low. very or I I’m sales first, to slightly POS and is The characterize just wondering half, differently. times the and in on can factories certain might asked question assuming be want if a us been that’s up a what running is touch for shipped second retailing tooling level. few With

takes the a For in example, some to of that? or higher, the what have Then puts same, follow-up. it and be I salient lower are would and POS,

Brian Goldner

weeks’ than happens Yes, our good are that shift team expertise quite so brick more and in the Gathering, going retail, less mortar, has for Then initiatives and does we with I Dragons and new retail such week’s our ecomm. so a as mix think have demand the a just drive Dungeons consumer as average of supply as our games the as and need can towards Remember of retail less are I the coming we couple line-up. the Magic of - that that of has fulfill supply reopening business. described, rest ecomm business look there there robust runs on we are a still are and omnichannel shifts well quarter, that very third ecomm, as

at the get good expect really Then Doh that, availability into Nerf, certain for where came weeks, the and POS shelves, certain satisfy the long-term with demand, Play remember team to holiday been out, supply need up amazing so doing our that QX, new are goal effectively. able we is not can is demand, going they’ve QX coming we’re to we business we don’t that We’re market. looking in to believe games, been season. consumer that has not have consumer in which seen. we we accomplish have retail inventories a think QX do, or a weeks’ on I’m strong at we’ve to we catch to restocking initiatives a to what as we whether satisfy very down, just is view again, seven and like continuing that on other very goal up our reduction as that comment challenge XX% we to but The

new marketing good really business. teams very and have initiatives, of lots plans, from the robust across the coming We

David Beckel

Thank follow-up as movie your your That’s helpful, on of to you. respect for you certain conveyed as you this plans update to toys just notably well have year? Joe My relates Could and partners what timings, some timing, then partner own by release to content your own. thanks. GI really us driven and with Disney,

Brian Goldner

well for are announced hope fact, people of to our been as part, strong already be Many XXXX XXXX and but for - partners’ that content, to year hasn’t theatrical initiatives moved incredibly yet. in the to Yes, business partners’ lining as IP. an our so our reopens and is the sometime soon, have really continuing most up IP

will and in next Raya expect slot XXXX it maximize and three next another out as out year, Pony Little Marvel feature will XXXX. Ghostbusters, movies including come We retail, movie, and in global or that quarter global move is opportunity to look and at year, to the fall, in GI connection we’re to In those likely should Joe My a with again and next right have be that specifics be and will a audiences also our movie, move working we Last the could into the to The into Paramount. animated we’re first working spot the you’ll our Eternals, But the QX Dragon. specifics expectation the now

David Beckel

much. so Thanks

Operator

questions. Our your next Katz Morningstar. Jaime the with question line Please comes from proceed with of

Jaime Katz

look how about taking revenues, curious is to of related over the but more. you’d there I’m help the puts composition Thanks. for worth unpack my that noting of gross that any the were think a Thanks might half second morning. the performance or year? part be and us if takes good might bit Hi, mix questions. willing know it of margin I little

Deborah Thomas

Sure.

number. the Our a about impact actually slightly it, gross releases the had and quarter and negative impact you Magic strong, on that of margin in the is if think

impact standpoint and could pricing good ability However, some a in piece it the talk We running flights one see But we don’t remain we of freight, margin shape to is strong. actually having air you from business as the so freight for the thing air see lot costs we now, well. the air of the that. as our that overall a have is on The fewer of have just an a it. to did rest reason, freight freight. Should and if about air is good, appreciate, we the change can Hasbro to more, to significant up with is cost

without hedged about purchases, know, exposure so three FX amortization, think X those originally model of we as quarter. rates it’s are I hard around the would the - for now year the did a don’t at some we well. know the lot good in it our quarters of and coming our of we the but about variability X% is head’s of I so this at said production that’s beginning for a we’re pull that Clearly think level where You If of factor between is all right XX% estimate. originally we be our product into have year, program to guidance,

and production it done bit that the of may Given that as see of delivered, run what we year a program get think part for the I can below we rest the we that But the think actually really about air this freight different looking margin. overall, gross that we the to at it components, is the I remain impact could expect referenced. thing and it strong, biggest point at

Jaime Katz

make us of as a should may up you’re in if think second percentage the as help you the like Then I’m that? we efficiencies it it finding advertising it in channel Thanks. wide helpful. wondering think Can really sounds percentage in year, likely change as sales, the not about of but be a half the That’s that sales. different of advertising about

Brian Goldner

sales. I not the It’s really percentage Yes, right. you’re think about of

just as marketing part which of of the the I some storytelling are omnichannel the P&L, the online Obviously way content to go buckets that development, also other places, effectively gaming storytelling different team and brands. spending is puts than kinds together, think creation well some of of line. the the that advertising and lines of that on work retailers, our our with we programs for other and

across you’re don’t advertising is as marketing, - the number robust planned half much overall for line second increasing be So to see I a right as of advertising and overall the dimensions.

Operator

with comes questions. question Morgan. the with from Tami of line next Our your Zakaria JP Please proceed

Tami Zakaria

of assumption EX my and hit, a tour taken to end by synergies loaded revenues was lot EX synergies the XXXX so going it of first the you much so be loaded, is in-house, more is for be are question? my tied question thanks to your bringing is savings of now, have expect revenues a back-end that given to the million do related more My [indiscernible] back-end $XXX Hi, questions. taking

Deborah Thomas

Hi Tami, good morning.

XXXX. believe and on with There on XXXX. before for exciting things together. may thing changed all the synergies for by COVID million is well The track. year we still you moving associated still think synergies cost million year, the teams collaborate that we we’re we still it of because over of the squarely I are This we’re and well, that $XX be this us, we expense the think achieve $XXX projects, we’re year, some still all in business with and situation, that on has are track is the we’re the on do for we’re of but and one to still honestly next million video right, track dealing working on future. future but great on can $XXX that’s track Obviously working and integration around, The going the thing. really by expect

Tami Zakaria

costs media My shows along likely that Got you have protocols. the of we it, the or to been think for are Do hearing not an XX%, increase is pricing costs follow-up of those delivered? contracts that’s is new the to networks, COVID-XX it in helpful. see be the you super pass production given can place given already XX to may

Brian Goldner

ongoing I think that be there dialog. will

one-size-fits-all and The productions protocols that the of safety people that team crews taking, a is making teams and going linear to is feel our are the making think lot and on executing. to that priority the there’s overall and and making goes are the the dialog. the on lot incorporate of just a and the overall one like broadcast been costs solution, partners, it progress protocols be the and and the ongoing are cast an and that us being There’s partners, look has are and are won’t to the it’s try mitigate cost very the to strong dialog I answer most and safety production, important teams of not good of budgets steps there. ways set, there streamers, the Clearly that partnership while there. a between there there I of at meaningful

Tami Zakaria

best of Understood. so Thank much, luck. you and

Brian Goldner

Thank you.

Operator

line your the next questions. Please The from with of Drew question Stifel. Crum is proceed with

Drew Crum

million good do operational? expect you you million running Hey film TV up to and Deb, when you’re or be originally morning. above range or production that you thanks. guys, that at Okay, think forecasted Brian, would XXXX, for this look fully below $XXX you have to $XXX and year, at and threshold? should as you

Brian Goldner

the is the Given our be prepping for team expectation current production, full all and we’d back productions. across plans what September in is of in production in our

used is unscripted production not productions done I lot by in running teams expect film a started number unscripted remainder. the in be incredibly we keep those have throughout pandemic. and said, in Canada, are shows As scripted shows, as then for but we in we across regions should tech already of U.S., to started the well on which scripted again U.K. really they’ve again September up have just The a we’ve going, the beginning, of that the novel the and

Deborah Thomas

full With on every--or the the same everything. to production year’s next actual would we back to we be can expect respect if we be production level go production levels in in if can spend, to for

a we’re but on, fluctuate that about that some now spend Now, level. have right we we bit because things expectation it same catching would up might is our little

Drew Crum

POS. there’s keep then or or down, strong bricks for want given versus for a so half? Should nearly industry, been for for and space demand floor be your of follow-up, your discussion it, my XX% category business, unchanged and I you answer or across the the shelf lot what it know space second ecommerce, We year? last the for however of up, mortar to the are expectations hearing is Okay, that, on

Brian Goldner

they’re good We for job. ecomm we’re putting building together have as with brick done mortar. retailers, plans for already have a and our well lot very teams and a of as both plans robust or omni The

people not given on that to can to on a think store bring for hot selling and time more is and for programs go laid as is have years. coming lot we’re year-to-date. different of starting product obvious very that all to different prior lot promotions growing than all see the comment retailing that of the longer this believe opportunity that of initiatives customers we that. be our it over retailers new I some will out period have modalities that year goal the way than more effective space, worthy into give want a to think the floor working a far and prior innovation unfold up been customers online this of period, QX year for so to that’s a do have I The a about for year, to on buy curbside, and access or certainly rather use give day, to reasons, pick a all but of so new expanded We

across really XX% our the and ecomm our are brands, plans. QX, we franchise and curbside, franchise in brands was point ecomm ready very Our about and Nerf up we shelves ecomm, fourth quarter, POS, Doh ecomm we at up XX% more and our it omni, teams the XXX% also To up have XXX%. for up your pick-up in data - strong to expect really are BOPIS best across with U.S. straight the be in looking merchandisers stores, was on than Play were or retail but robust stocking

we people don’t stores. it to from the than up we’re product buy want, find that were their to were at consumer, through up the games that same, or to or they products that for cart continue either than the brands XXX%, seeing more Our pick-up, pick-up, opportunity then so it more desire, expect and want, they as these a fans emerging originating product and the and up with curbside retrench, partner online families, kids shopping get the the searches brands brands in-store step-up satisfying we to were expect more expand XXX%,

Drew Crum

guys. it, okay. Got Thanks

Operator

Thank you.

with is line Handler with Eric question Please Partners. the next MKM of questions. from Our proceed your

Eric Handler

was very thank high that for overall U.S. teens. XQ July. what POS. you by could up you perspective little also I on be international, much. POS a bit and if Wonder you said in Yes, give some in the could you was, number if able talk international believe more wondering region about you Wonder if might for to give

Brian Goldner

so so North June XX%, POS said France, about markets it less in in was up that was talked high Latin single global American U.K., recent America and but - low down than others and down we’ve up digits July, very marketplace, single was XX%. and Sure, challenged, digits, we’re first, QX was we with POS good substantially, as quite we exit growth up across of about seeing number a Europe. revenues but and was into POS Europe

Pacific similar American QX and brand Asia Australia, seen the franchise brands seen in and so growth at [indiscernible] in be the the category, for region. our overall about double by of digits. Then look retail online. single strong plus-XX%, Pacific brands to up China up QX, up opportunity in mentioned Franchise digits, our demand. POS nearly--well, up double XX%, even In our to We’ll were were POS. U.S., XX%, that digits. QX has Gaming We’ve toy high now our business in North digits, very was selling the if I we’ve actually, was it rest growth back good single was launch up up very partner come as China, strong the and then high XX% again POS over at POS was new very down strong up QX. slightly and you in brands U.S. initiatives into were growth

Eric Handler

to Magic XQ Magic Spell when to game, well spinoff the in testing then you as and if wondered quickly expect the for with Gathering, for have are fall XQ as just Arena launch, Great, likely start Slingers. the dates, or they the Gathering mobile you

Brian Goldner

in have We and mobile Slingers likely Yes, honed so on already will That be and is XXXX. to Spell to first. development early continuing want is in Magic test game launch market.

and shortages set launch I four set date, Tencent in always Rising momentum We for said development announced the bring and production QX are with have gaming last very to quarter We it the a year. Zendikar in robust The you second from will comparable the It development core grew XX, it’s haven’t ruin calendar now--was half XX. in We well, of. be along. set from release remainder has releases so year a expect I QX was XXXX. like has this but a want July China through announced September releases August key The haven’t the quarter had to with Dungeons the also QX, that the is announced brand that also we surprises, quite don’t X, jumpstart modern our releases brand They X, there actively second very set specific yet. will robust due September. been to be great year. partnership They’ve and gamers that was and Dragons, is fans digital will July master the but remind continued. and for fourth in given the can there. for Then our to has double That of and performed which moved have this line-up all masters

Eric Handler

you much. very Thank

Operator

The question questions. Johnson with Capital from Gerrick Please of proceed line Markets. the you. BMO Thank next is with your

Gerrick Johnson

knows be did at toy things: it announced then home? that perform they’d after morning. to the we’re that streaming about All I right, Who release How and could Trolls. Good product when thank movies pre-COVID of. your the and streaming one, to two, you. to see plan, was we you your wanted back to, something ask more via post-COVID going released be plan the Trolls relative again, relative

Brian Goldner

impact the really plan that set April Yes, window it’s fact late was Universal PVOD the to the home merchandising to But all from a after strong. retail is much and as being that it movie working to opportunity was making was were of across so and a period on in as of there, moves closed switch U.S., plans being the the lot stores marketing PVOD, was every just that in remember U.S., how across was movie so movie the the to that dimensions. the done versus multiple as for drive know having not so the hard marketing, the to was In again, brand with merchandising we’re clearly our and the move impacted PVOD there entertainment.

Now, just available are for be streamed just - happened The a some What Clearly Mandalorian home they that and environments, Trolls had entertainment look sales, demand that set product, we those really for are once. Trolls at we the because say was at plans yet, but brands very not have rather as staged world, albeit that still and COVID that up I’d will windows, are had around being interest are the seeing and as in and are lots some and there start, of so world of will generating retail place than ESP the switch products. is already have theatrical. other good around taken of seeing very theatrical selling we launches solid more

Gerrick Johnson

Okay, to yes, there, so discern. of a lot hard noise

there postponed the maybe has question dropped, delayed, you will as completed are planned? percent any be be expecting be what as been expect of you that or far completed that to some so here, indefinitely Could programming cancelled, Another planned?

Brian Goldner

some production. have want we’ve just Yes, our network to are meaningful that you any extent or There that of we whether big this for don’t substantial so in can some even right to of point, getting or I number comment really know we QX if shows a now the of into move revenues at series cancellations about seen produced number further? set XXXX. year, of those aren’t it’s Deb, this that

Deborah Thomas

No, I agree Brian.

what is--if that the complete, really you it really, meaningful. It’s aware at right no it think and expecting have outstanding getting of done. we matter of I are now what just we’re that blend of a to look we’re cancellations,

Gerrick Johnson

the Okay. in had way, on you form around thereof. projects in IP the Hasbro you or XX By some mentioned first quarter, that production

change? XX. over Now you still did Is it’s the XX, say that number or

Brian Goldner

the number is I was if specific, XX. Actually

Gerrick Johnson

Okay.

Brian Goldner

XX multiple and Dungeons So like brands XX projects, there’s certain IPs, Dragons. it’s around so Hasbro around projects

Gerrick Johnson

Great, guys. got Okay, you. you thank

Operator

line Barclays. proceed The Priya Ohri-Gupta with the of next is you. Thank with your question from Please questions.

Priya Ohri-Gupta

the recent around hoping the comments any question us Great, into and on agencies, thank conversations well as Was covenants. financial an earlier you’ve liquidity, just around the to taking any ratings your your and should thinking Thank could be we ’XX, you had rating you the over with the as pressure so two give just we’re specifically of as you. much with business. for regards update pieces points given mindful of moving some with next IG out quarters the

Deborah Thomas

Great, thanks.

call long basis year, the We the we set with but--you conversations maintain with time we that know, year unusual year, This out it’s for to and those dialog. say but this them changed. safe we rating control have what of rating, this beyond We on but constantly obviously we have again plans you assessment, sharing them the three know, all final well. our an talking agencies. haven’t dialog are to right, been I all and You out don’t with ongoing our assessment to we of which have could a at interest look their on term look that forecasts on them, we two we look If them. with of as everybody impact everyone, expense our are the three, at that forecasts some potential reason downgraded be, for think what a has if would for were updated our when the by impact an

our about of Our ways creating the and having working leverage good very around lot opportunities. integration and so haven’t can time more we brands together talked a sit in plans changed. long-term calls revenue everyone Brian’s out has teams on video are with that been identifying take blueprint, to those for

As at delayed right a together experiencing plans plans, they’ve term haven’t this XXXX anomaly longer really we of what by and gotten all changed, just our we’re now. bit our look

Priya Ohri-Gupta

and could they agencies flexibility of one lack that understand provide term have that, just change something is to they to for? delay perspective, follow-up are willing I ask and longer the If that given in indicated the

Deborah Thomas

As I said--

Brian Goldner

we’ve as through second we I says, you half together, the we Deb, think beyond the technology. sorry. get XXXX [indiscernible] put plans that the this look the the I plan. look--oh, our Well of modern already at we’re year, we as [indiscernible] for and these Deb objectives Look, comment--sorry, figures opportunity set should plans, strategic move as seeing of

share comment The Deb? quite so know robust into line-up we’ve with term progress we if we As that don’t and our and we’re excited we are the see and longer got what we you have plans see, about there. a they things want extensive. got further, really there the can to agencies XXXX, plans very incredibly I is

Deborah Thomas

I That’s exactly say. to was what going

Priya Ohri-Gupta

Great, thank you much. so

Operator

Badishkanian Please Greg proceed you. is next line Research. the question Thank of with The questions. from Wolfe your with

Fred Wightman

we from look tariffs good just import the Wightman in business If year, Fred guys, go your at back direct morning. was what on half Hey It’s Greg. actually that back some quarter the last and for impact third of there did specifically. to and

in XQ modeling or mix we’re this this ramping the sort the plan prior where year how higher seeing we are compare, guys thinking about of As you you’re then production year, and split, that should given for of about year currently? think ecommerce XQ, just terms

Brian Goldner

teams greater we very even as through domestic. now as domestic to look whatever accelerate tell and that ecomm a provide, to all looked ecomm unfortunately I retail. but of oriented were more and year, away you are at this we took towards product early split, If can capable we omnichannel would getting year import what we it’s the be normally The gotten is Yes, guidance broad of at our further year of for half new shift. along proportion even The objectives we the we plans that QX our of very manufacturing in that a of we initiatives opened that have, number is was production recovery. helps achieve total through can with in road QX can holiday. the have two mix that for the - be XX% Look understand, months. closed us We to retail sales, good second

well so QX, our rates season. a executing that of about We are an brands about declined but better recovering QX good have slate enormous inventories standpoint, QX than catching up a have across from I the and performed have is say and on retail holiday declined, is consumer quite meaningfully would sales demand although fill

Fred Wightman

you. Okay, thank

Operator

proceed of your The from with next question of with Devin Bank the is line question. Brisco Please America.

Devin Brisco

Hi, question. my thank you for taking

currently management that you’re commercial some your able forward think the we organization to to more seeing higher you into business that about half You freight the out costs into opportunities about of cost of year costs in of air mentioned quarter. take second going some but Could related also simplifying talk from the XXXX? efficiencies cost how and some the and the you’re should some

Deborah Thomas

List take hedged, of to take of product, little we we of talked because product. our pricing Sure. end We’ve because had last to shortages, year, a at about cost We not about. the that’s how. bit Well, the as we’ve much XA look of on had had our and in pricing I some increases some as input of but lot, most tariffs of cost product talked obviously a gaming, is not and just our at

do In flex our increased able U.S., we’ve trying really As we moving we contract regions our to warehouses. forward, ability and ecomm travel to will costs our the quite to increased cost Europe, efficiencies of as product to all align of out we ability that we’ve cost look all once been seeing moving also we’re as we the this will simplify bit quicker where contracts so expanding sure from as then go games we great deliver on our and helpful locations, more within efficiency introducing cost in of that look our can over move get activities of our digital to into and most just and to some out move that things the get out of we a possible talked bit of are we that to other year, the retailers trying make come as cost, that and got our the we’ve do last that ecomm, increase in to a at able expense start costs where in business, very our we’re from now, standpoint do think well taken is warehousing We’ve forward we on But time taking that’s We our that, we we’re seeing we’re to achieve into help a product we’re we they revenue gets our so we’re were so to really side as various product our margin our from an from service see and lot out. have time, over we’ll to that. secure well. both back what savings more expansion so changed it product the time. that the actually to development continue But some various as be we entered cash and great right with market. our and think we about savings focused that to this costs a how we of about and

Devin Brisco

thank Great, you.

Operator

question is Please your The questions. Keybanc proceed line Markets. of Brett you. next the from Thank from with Capital Andress

Brett Andress

exclude some Just detail shipments guess Latin if the been the alluding year-over-year during we to you of positive the Hey, understand June into of did to. improvement turn magnitude or shipments trying Can I quarter? on cadence you’ve good morning. July? the America, give

Brian Goldner

Play you third so manufacturing Yes, mid-March, to games Irish get manufacturing and comes That’s expand of party type mid-May--to from those so factory been Ireland it, our Massachusetts, Play the have those were Massachusetts, for and if as from so factories marketplace. Ireland the rushing of and throughout about has well a about business. as - our games team and mid-May capacity think the Indian and as Doh again, clearly closed reopened, for games, similar of out it’s Doh similar

manufacture QX production In U.S., addition, and they’re so so saw to trading Wizards chose or disruptions the booster out other now that. Coast, jumpstart able to so to and dozen the another the in team in we move half of across again card and execute the games QX, locations for products,

launch is I’d ensure Nerf we products later QX to we we what as we’re to month one seeing increasing of access is liked in India, high incredibly product and had well performance shoots is that which that well. from This Ultra ratings high product, enough way seeing feet of and selling say access enter coming really moved just to our So really we’re fans. the the is the now our products, that out by XXX

QX, caught consumer to say shipping of I and So the we’re demand. half really would that is fully up second strong meet by what

Brett Andress

Thank you.

Operator

you. Thank

line Please with Our final the from question Tim Wells Fargo. Conder your is of with questions. proceed

Tim Conder

there we a Deb, ecomm. that to the Clearly year? the yourselves, bad circle where situation been the of there quantify Then lot for all focus I partners in Theoretically industry up. offset back down I thanks to Brian, is ramp would way wanted the a to half the Thank on you. color. any by has and substantial follow-up. to a if shut that is of a year, of the and increased half bandwidth brick the back back in ecomm the have mortar hit

Brian Goldner

- build were we for that Tim, I demand the and to something satisfy brick that question. of obviously ourselves don’t were have it but - planning within talking warehouse if our Sure our that we and at to enormous last to product a as expect from It’s demand. on and holidays environment way it’s shift and all work now, mean, to other look online, the partners. the It’s we the the to we with about the capability mortar way step-up. in techniques, with underline we capabilities dramatically content as online market and we an great entirely really teams hypothetically shift, We the could so commerce years few continue over we built the and ecomm omnichannel way improved algorithms. working

we satisfy and to could So that there we ability a say our shift. meet that I to that have would we shift if shift toward that the would were additional major be demand, mix products ecomm

Tim Conder

that except Brian, that LatAm? Would basically to be you’re a So there? everywhere interpret would be what fair way saying

Brian Goldner

XX% team ago. won’t digits going business, currently from about--we time, right. business I’d the immediately and that’s don’t there and so moving a take That’s of Latin of small that omni so--unfortunately and a business from the benefit it’s of resolve say and being we exactly and or situation challenged. is a single the ecomm bit through beyond lot a such effort just COVID been up done America, it’s still the little more have to see about percentage that’s a of there, year the

Tim Conder

and happened, it shift would that comment with the would what earlier to channel are permanent It Universal with and follow-up here, answer, releasing can maybe seem at diversifying Okay. that, question Then industry possible, of if all and do see diversifying around there, danced forward? product go-forward, you’re theaters, general, you are Trolls, the traditional on the was basis? my know, Paramount, from maybe move looking including what now at channel still the that that how hard from what’s you’ll in shift to going what alluded be, and studios that, the given on, shift but made about thinking you kind doing how but or just the maybe a you you

Brian Goldner

Look, enjoy I as experience. all having we desirous laugh going a there. ooh screen, at of so we as like people get with people ahh into want can big all in some of hundreds everyone theaters along theatrical something or think There’s back very nothing at We the movie movie, of that to action, back soon want big else. together and to and something a get are that’s on kind

I EX in purposeful, I by that feel safe and wanting are have There’s nothing the we theatrical so people when of global theaters we protocols where to team, and releases, to still and people going those the away. that to being is value get think a demand theatrical it’s world abide be build way opportunity it fully as a studios think semi-simultaneous comes to position around matter obviously at theaters, the for don’t the see in can opportunity clearly we that really go for looking a to to back, just and like talk reopened. audience. the go very have

at that will environment go planful being Clearly theatrical. with these to about everyone to we that out partner is important will streamed thoughtful, initiatives ones looking Trolls is continue a Universal of the most directly versus and the can of which wouldn’t make movie thing go which of we be I strategic already closing, will having so very think theaters into switch and was make, happened COVID but that that at really already could looking set, the retail, marketplace marketing unfortunate that kind stocked future. use coming, as been of being that shelves a purposeful in I in because around timing the we strategy the

look Mandalorian million what been or create it’s the Frozen, people, just or entertainment with us. Disney Disney at that Stranger strong The as you has look XXX or able been on in our what for princess Plus able window there at Plus, been Things business movies to create, and has You very to create, has home of to games able collection been

going I norm, thoughtful owners be are about and they forward. how studios strategies go that think more think the I out lay that’s to and IP those

Tim Conder

you. Thank great. Okay,

Operator

over I’ll At Thank question time, the of and this end reached our we’ve closing call for you. answer to session, Debbie remarks. and Hancock turn the

Debbie Hancock

available two hours, thank Thank you you be remarks The will prepared on everyone website be Thank will this and today. us and you. management’s in for posted on website our joining the approximately following call. Rob, replay

Operator

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