It’s been over a week since the quarterly earnings call revealed Hasbro Inc. (HAS) – Get Hasbro Corporation Report The Wizards of the Coast subsidiary posted a 15 percent increase in sales last year. The company owns niche hobby IPs such as Dungeons & Dragons and collectible card games like Pokémon and Magic: The Gathering.
Even more impressive than the 15% increase is that, according to Hasbro CEO Chris Cocks, most of the profits come from one particular game.
Wizards of the Coast grew out of a personal frenzy
The Wizards of the Coast (WotC) came together in the early ’90s. The company got its name from the owner’s own personal Dungeons & Dragons activities, so acquiring D&D and its parent company TSR in 1997 was a dream come true. But before TSR, WotC was creating and acquiring other role-playing games.
In 1993, the company acquired the rights to a trading card game called “Magic: the Gathering.” Over 35 million people play this fantastical, detailed game, both physical and digital in the gaming community. Some personal collectible cards are worth six figures.
Wizards of the Coast is still having fun with its parent company Hasbro, which acquired WotC in 1999. There’s an upcoming D&D movie in the works that will provide the company with plenty of marketing and revenue opportunities, and it looks like it’s gearing up for it.
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The company just opened a new video game studio called Skeleton Key. The studio is currently hiring for multiple positions, suggesting that more WotC video games are on the horizon. They will likely focus on WotC’s most successful IPs, including “D&D” and “Magic the Gathering.” With a D&D movie on the horizon, Wizards of the Coast could be a source of significant revenue for Hasbro.
WotC is brewing good stuff for Hasbro
The company is working hard to create more Dungeons & Dragons content, but its “Magic: The Gathering” has blown up WotC’s sales numbers over the past year. In fact, the game has brought in over $100 million across multiple platforms.
Hasbro CEO Chris Cocks has made no secret that the acquisition is bringing financial magic to the company.
“Wizards of the Coast is an important and critical business for us. It has been a key growth driver for the company. We have performed well in the Wizards business as a whole in the first half of the year. In the first half of the year, we saw It grew 5%, and we continue to forecast the high end of our high-single-digit to low-double-digit growth range for the full year,” Cox said on Hasbro’s second-quarter earnings call.
“Wizards tends to put a lot of emphasis on MAGIC in terms of the makeup of that business. MAGIC is probably around 70% to 80% of the whole business. And we tend to — somewhere between the D&D brand and the MAGIC brand, it tends to be very North American. Center. About 75% of our total sales occur in the U.S., Canada and Mexico.”
Expect to see a rise in sales of casual hobby properties such as role-playing games in what some see as the beginning of a recession. It will be interesting to see if Wizards of the Coast continues its upward momentum as Hasbro capitalizes on two of its iconic fantasy franchises.