A global toy, game, and entertainment company behind MAGIC: THE GATHERING, DUNGEONS & DRAGONS, MONOPOLY, G.I. Joe, and Mr. Potato Head. It was founded in 1923 by three Polish immigrant brothers in Rhode Island who first sold cloth remnants and pencil boxes before making toys. Its Mr. Potato Head, launched in 1952, holds the distinction of being the first toy ever advertised on television.
Wizards of the Coast revenue rose 27%, driving Hasbro to a $252.5M operating profit after a year-ago loss from a $1.02B goodwill impairment.
A year after a $1.02 billion charge wiped out earnings, Hasbro returned to profitability. rose 13.8% to $1.29 billion and reached $252.5 million, driven by a 27.1% increase in the Wizards of the Coast on strong MAGIC: THE GATHERING tabletop demand. The core games business is growing, but a network breach and a $56.4 million digital-games signal new costs to watch.
Key takeaways
swung to $252.5 million from a $798.2 million loss a year ago, because the prior-year quarter included a $1,021.9 million non-cash charge in the Consumer Products .
Wizards of the Coast and Digital Gaming rose 27.1% to $663.7 million, led by MAGIC: THE GATHERING tabletop releases, while segment rose 24.3% to $340.0 million.
Consumer Products fell 6.1% to $415.3 million, and the segment posted a $47.5 million operating loss as $9.4 million in tariff costs and higher product costs weighed on margins.
Section summaries
Management's Discussion and Analysis
Q2 2026 revenue rose 16% to $1.14B driven by Magic: The Gathering, swinging to a $252.5M operating profit from a loss last year due to a prior $1.02B goodwill impairment.
⌄
Consolidated net revenues increased 16.2% to $1,139.6 million, primarily driven by a 27.1% surge in the Wizards of the Coast and Digital Gaming , led by Magic: The Gathering tabletop releases.
narrowed 1.2 percentage points to 78.9%, as a higher contribution from the Wizards was offset by increased royalty expense tied to licensed MAGIC: THE GATHERING sets and higher product costs in Consumer Products.
Selling, distribution and administration expenses included a $56.4 million non-cash from refocusing the Digital Games portfolio and $10.8 million in costs from a late-March 2026 network security breach.
rose 348.7% to $247.7 million, and the company held $880.5 million in cash and $497.7 million in short-term investments, with no borrowings on its $1.25 billion .
What changed
The Q1 2026 flag about whether the network intrusion would delay Q2 orders was confirmed: the company recorded $10.8 million in breach-related costs and disclosed that the incident caused some order processing and shipping delays.
The Wizards of the Coast 's growth rate accelerated to 27.1% from 25.9% in Q1 2026, answering the question of whether growth would decelerate as the record-setting 2025 Universes Beyond set launches annualized.
The Consumer Products 's operating loss widened to $47.5 million from $47.5 million in Q1 2026, as incremental tariff costs continued to accumulate, though the decline moderated to 6.1% from near-flat in Q1.
The securities class action motion to dismiss was filed on February 6, 2026, and the company stated it cannot estimate a reasonably possible range of loss due to the case's early stage, leaving the outcome unresolved.
What to watch
Whether the $56.4 million Digital Games portfolio fully captures the , or whether further charges follow as the refocusing continues.
Whether the Wizards of the Coast sustains its 27.1% growth rate in Q3 as new MAGIC: THE GATHERING set releases cycle through and no comparable digital release has been announced.
Whether the Consumer Products 's operating loss narrows in the second half, and whether the $9.4 million in quarterly tariff costs remains within the full-year estimate.
The outcome of the motion to dismiss the securities class action, and whether a denial triggers the company to record a loss contingency or the stayed derivative suit to resume.
reached $252.5 million compared to a $798.2 million loss a year ago, largely because the prior-year quarter included a $1,021.9 million non-cash in the Consumer Products .
Cost of sales rose to 23.9% of net revenues from 23.0%, pressured by $9.4 million in tariff costs and a shift in product mix.
Selling, distribution and administration expenses included a $56.4 million non-cash from refocusing the Digital Games portfolio and $10.8 million in costs from a network security breach.
The company has ample liquidity with $880.5 million in cash and $497.7 million in short-term investments, and it issued $400 million in new 2031 Notes while repurchasing $125 million of outstanding debt.
Management highlighted new strategic moves under 'Playing to Win,' including a Harry Potter toy license starting in 2027 and the launch of an AI studio, while cautioning that tariff and cyber incident impacts could affect future results.
Quantitative and Qualitative Disclosures About Market Risk
The information required by this item is included in Part I, Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations" and is incorporated herein by reference. 43
⌄
The information required by this item is included in Part I, Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations" and is incorporated herein by reference.
43
Hasbro faces a securities class action over Magic: The Gathering statements and a related derivative suit; no loss estimate is provided.
⌄
A putative securities class action alleges false or misleading statements about Magic: The Gathering's growth and 'segmentation' strategy from Sept. 2021 to Oct. 2023.
Defendants moved to dismiss the amended complaint on February 6, 2026; Hasbro intends to vigorously defend.
A shareholder in Rhode Island, based on similar allegations, is stayed pending the class action's .
A recently filed related to Hasbro's cyber breach is not believed to be material.
The company cannot estimate a reasonably possible range of loss for the securities class action due to its early stage.
A March 2026 network breach and rising cyber threats are newly emphasized as material risks to operations and data integrity.
⌄
A specific unauthorized network access in late March 2026 was contained by June 28, 2026, but future incidents could materially harm operations and financial results.
Cyber-attacks are growing in frequency, sophistication, and intensity, carried out by nation states, organized crime, hacktivists, and malicious insiders.
Compromises could disrupt operations, delay product shipments and payments, damage reputation, and lead to significant costs, liabilities, or loss of business.
Third-party manufacturers and business partners also pose data-breach risks, including supply chain attacks that could delay manufacturing.
Risk of data loss is heightened during uncertain economic times, strategy changes, and workforce reductions.