Hasbro Inc. (NASDAQ:HAS) Q2 2019 Earnings Conference Call - Final Transcript

Jul 23, 2019 • 08:00 am ET


Hasbro Inc. (NASDAQ:HAS) Q2 2019 Earnings Conference Call - Final Transcript


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Q & A

Thank you. At this time, we will now be conducting a question-and-answer session. [Operator Instructions] Thank you. Our first question comes from the line of Eric Handler with MKM Partners. Please proceed with your question.

Eric Handler

Yes. Couple of questions. First, Deb, I mean, you talked about last year in the third quarter you had, I believe, your Netflix deal. Wondered if you could talk a little bit more about what's incremental for new product shipments in 3Q this year versus 3Q last year?

Deborah M. Thomas

Sure. Well, I'll talk a little bit about the -- about the streaming deal that we did last year, which is a recall, we just point out because just for comparative issues. If we think about entertainment licensing in the third quarter of last year, because we had delivered full season and library content at the time of revenue recognition, it made it a little bit of a bump that quarter. So that's why we really pointed it out.

And, of course, as we look to the fall in the third and fourth quarter, we have the amazing product offerings in a lot of our new brands that we've talked about. And I know, Brian can elaborate on some of those, like, some of the products we have coming out. And then in the fourth quarter we're very excited for all the entertainment driven initiatives in Frozen and in Star Wars in the fourth quarter. So we're really excited about the back half of the year. We just wanted to make sure we pointed out some of these little corky things that would impact the comparability of our quarters year-on-year.

Brian D. Goldner

Yeah. One of the more notable brands that's rolling out throughout the year are new innovation as the headline and digital engagement is certainly Nerf. We saw the Nerf POS go up in Q2. A few markets have the new Nerf Fortnite product like the US and a couple of countries around the world, but it's really expanding right now. So Q3 is where it takes hold in major markets around the world.

We'll have more than 20 new Nerf Fortnite items rolling out and new innovation also for [Indecipherable] zombie, rival and mega. We also have this new high performance value-oriented product that launches in the very near-term, so that's third quarter. This is for the value shopper that really is looking for the Nerf performance. We know that kids and young people really want to play with Nerf. And we want to give them the opportunity to experience our kind of innovation and performance for that under $20 price point.

So we certainly expect further Nerf momentum in the second half with many of these new initiatives. You will also see some new protectable innovations coming later this year. We've seen great momentum year-to-date. And transformers is up, we have new initiatives in the fall there in Baby Alive. Our gaming initiatives Play-Doh us up. And then as Deb said, we get into the fourth quarter