Hasbro is laying off almost 20% of its workforce amid lackluster sales during the crucial holiday shopping season, the toy-and-game maker said Monday.
“Today we’re announcing additional headcount reductions as part of our previously communicated strategic transformation, affecting approximately 1,100 colleagues globally in addition to the roughly 800 reductions already taken,” Hasbro CEO Chris Cocks told employees Monday in a memo shared with CBS MoneyWatch.
Many of the employees impacted will be informed within a day, and the majority of the reductions will occur over the next six months, he said. Hasbro is also opting not to renew its lease on its office in Providence, Rhode Island, with its workers expected to transition to the company’s headquarters in Pawtucket, Rhode Island.
The decision comes after softer-than-anticipated toy sales through the first nine months of 2023, with the difficulties expected to continue into next year, he wrote. Hasbro makes toys and games including Monopoly, Dungeons & Dragons and Play-Doh.
Inflation and the resumption of student-loan payments are taking a bite out of many households’ disposable income, Morgan Stanley wrote in a recent research note looking at sluggish holiday retail sales.
“We are expecting weaker results in goods-oriented industries,” Michelle Weaver, U.S. equity strategist, said.“Airlines remain the one bright spot, with consumers continuing to prioritize holiday travel.”
Hasbro in October tallied a fourth straight quarterly loss as third-quarter sales fell 10%.
Competitor Mattel has fared better, aided by the success of the “Barbie” film featuring its most famous product.
Shares of Hasbro were down 6% in after-hours trading.