What happened
Toymaker Hasbro (HAS 0.22%) spent $3.8 billion to acquire Entertainment One (eOne) just prior to the start of 2020, but returns from the television and film production business were hampered by the pandemic. In its second-quarter earnings report, released this morning, the company said that's now turning around. Investors cheered the company's quarterly results overall, sending Hasbro shares soaring about 11% as of 11:20 a.m. EDT.
So what
The maker of popular brands including Play-Doh, Nerf, Power Rangers, and Monopoly reported revenue had jumped 54% from the prior-year period. Hasbro announced adjusted net earnings of $1.05 per share, more than twice the average analyst estimate for the quarterly period.
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The company also repaid $250 million in debt during the quarter. The strength came from all segments of the business, but CEO Brian Goldner pointed to particular strength in its fantasy- and science fiction-themed games. Goldner said in a statement, "Wizards continued to generate outstanding results behind a compelling analog and digital release schedule for MAGIC: THE GATHERING."
Now what
Entertainment revenue was also a strong contributor, jumping 47% year over year. That's particularly important, as the eOne acquisition has been a short-term disappointment due to impacts on production during the pandemic.
Hasbro expects the momentum to continue, with guidance for double-digit revenue growth for the full year. In addition to paying down some debt, the company has had ample cash flow in the first six months of the year to fund its dividend, which yields about 2.7% at the recent share price.
