Tariff Impact on Hasbro and Wizards of the Coast
Hasbro Seeks Tariff-Free Toys Due to Ongoing Popularity of Magic: The Gathering Cards
It's been about a month since the Trump administration's tariffs went into effect, and several companies have felt the heat. Surprisingly, Hasbro isn't one of them, thanks to its clever arrangement in the global trade scene.
In a recent investor call, CEO Chris Cocks expressed confidence in Hasbro's resilience, stating the company is well-prepared for the current global trade situation. This resilience is mainly due to the digital nature of its games business and the domestic production of its board game division. The manufacturers of Dungeons & Dragons and Magic: The Gathering, handled by Wizards of the Coast, have "low tariff exposure."
The international manufacturers are stationed in Kyoto, Japan or Europe, with the latter currently exempt from tariffs. On the other hand, China, which bears the brunt of the tariffs, remains a significant manufacturing hub, but it is only a minor source of D&D boxed sets imported by WotC.
Cocks admitted that the company has been conducting "more complex logistics" due to the tariff situation. He advocated for a "more predictable and favorable U.S. trade policy environment," echoing the Toy Association's call for zero tariffs on toys and games globally. He argues that tariffs result in higher consumer prices, potential job losses, and reduced profits for shareholders.
Despite the challenges, Hasbro isn't too concerned about the impact of tariffs on its Wizards products. In fact, Magic: The Gathering has been enjoying a "surging business" for the first quarter of 2025-2026, attributable to the division's 46% revenue growth. This streak is partly credited to the upcoming crossover with Final Fantasy, which is expected to boost sales even further.
While tariffs present a hurdle, Hasbro's gaming division is poised to remain a robust performer. Although it anticipates a total tariff impact of approximately $10 million for the entire year, the majority of this comes from D&D box sets manufactured in China. In contrast, Magic: The Gathering products are primarily sourced from North Carolina, Texas in the U.S., and Kyoto, Japan, ensuring they remain less affected by tariffs.
In response to the tariff situation, Hasbro is considering shifting production facilities out of China for other products, such as Play-Doh, to minimize future tariff impacts. Clearly, the company is employing a strategy of digital innovation and strong margin power to offset tariff-driven headwinds.
Want to know more about the future of your favorite franchises? Check out our latest updates on the upcoming releases of Marvel, Star Wars, and Star Trek, the future of the DC Universe on film and TV, and everything you need to know about the direction of Doctor Who.
[1] Hasbro Inc. 1Q2025 Earnings Release (2025)[2] Hasbro Q1 Earnings Call Transcript (2025)[3] Tariffs on Toys from China: An Analysis (Toy Association, 2024)[4] Hasbro's China Manufacturing Dependence (Bwright, 2024)[5] Hasbro's Strategies to Mitigate Tariff Impact (Bloomberg, 2024)
- The future of the gaming industry could see further digital innovation, as companies like Hasbro employ such strategies to offset tariff-driven headwinds.
- Financial analysts at Gizmodo might be interested in analyzing Hasbro's future earnings, given its recent troupe with tariffs and the predicted shift in production from China.
- In the current industry climate, Hasbro's games division is expected to remain a robust performer, with continued growth in franchises like Magic: The Gathering and potential crossovers with popular games, such as Final Fantasy.
- With Hasbro focused on minimizing future tariff impacts and restructuring production facilities, investors in the technology and finance sectors may want to keep an eye on the company's long-term strategies, as they could influence the future health of the business.
