Hasbro has been hit hard by the bankruptcy and closure of toy retailer Toys R Us.
Before its bankruptcy filing, Toys R Us was Hasbro’s third largest customer in the U.S. and its second largest customer in Europe and Asia. So, Hasbro and rival toy maker Mattel had to scramble to find new retail locations for their products in the wake of Toys R Us’ disappearance from the market.
While several retailers, including Target, Walmart, and even drugstores, expanded their toy sections this past holiday season, there were still far fewer shelves showcasing toys in 2018 than in previous years. The loss of shelf space appeared to disproportionately affect Hasbro, especially during the holidays.
In the fourth quarter ended Dec. 31, revenue fell 13 percent to $1.39 billion from $1.6 billion a year earlier.
“2018 was a very disruptive year, driven by the bankruptcy and liquidation of Toys R Us across most of the world and a rapidly shifting consumer and retail landscape,” CEO Brian Goldner said in a statement last week.
Since it was announced that Toys R Us would no longer be a major player in Hasbro’s distribution plans, the company has been introducing new strategies to right its sales. The company has been working on capitalizing on alternative ways of shopping outside of traditional brick and mortar stores and keying in to trends within the industry, like launching lines of toys based on the popular game Fortnite, executives said at an investor event on Friday.
With these changes, Hasbro hopes to return to the same profitability levels it achieved in 2017, the year before Toys R Us closed, by 2020.