Operating income rose 51.7% to $517.3M on Magic: The Gathering growth, with $54.5M of tariff refunds in the result 412. Management raised 2026 guidance to revenue up 7-9% in constant currency and adjusted operating margin of 27-28% 8-K.
Hasbro, Inc · Q3 2026 · Reported 20 Oct 2026 · US
Key figures
Million USD | Q3 2026 | Q3 2025 | Change |
|---|---|---|---|
Revenue | 1,595.3 | 1,387.5 | +15.0 % |
Operating profit | 517.30 | 341.10 | +51.7 % |
Net income | 394.50 | 233.20 | +69.2 % |
Diluted EPS | 2.77 USD/share | 1.64 USD/share | +68.9 % |
Figures in USD, as reported.
Magic: The Gathering supplied most of the revenue growth
Net revenues rose 15.0% to $1,595.3M from $1,387.5M a year earlier 7. Magic grew $156.7M, or 34.1%, on The Hobbit Universes Beyond set and Reality Fracture, and the brand topped $600M of quarterly revenue for the first time 8-K7. Wizards and Digital Gaming revenue rose 30.6% to $747.2M, with Tabletop Gaming up 38.8% to $613.1M 12.
Consumer Products grew a more modest 3.9% to $827.9M, helped by Marvel (up $46.8M) and the new KPop Demon Hunters line (up $13.3M) 611. Licensing revenue fell to $144.3M from $152.6M on lower Peppa Pig and Nerf income, and Reinvent Brands revenue fell 15.8% 67. Growth is therefore concentrated in a few franchises.
Tariff refunds and lower costs widened operating margin to 32.4%
Operating margin was 32.4% against 24.6% a year earlier 5. Cost of sales fell to 24.1% of revenue from 29.9%, reflecting about $64.6M less tariff cost, of which $54.5M was IEEPA refunds and about $10.1M lower recurring tariff expense 8. The company-defined adjusted operating profit was $541M, up 52% 8-K.
Refunds are not a repeatable source of margin, so the underlying gain rests on revenue growth and lower recurring tariffs. Advertising fell to 6.0% of revenue from 7.8%, which the filing attributes to campaign timing 9. Costs moved the other way in places: selling, distribution and administration rose to $331.5M on personnel costs including severance, and Corporate and other swung to $41.0M of expense from $2.0M of income 1015.
A lower tax rate and higher interest income added to the net income gain
Net income attributable to Hasbro rose 69.2% to $394.5M and diluted EPS rose 68.9% to $2.77 5. The company-defined adjusted EPS was $2.90 58-K. Income tax included a $16.8M discrete benefit from releasing uncertain tax positions after an IRS audit settlement 5. Excluding discrete items, the tax rate was 22.7% against 25.2% a year earlier 11.
Interest income rose to $14.6M from $6.3M on larger cash and Treasury holdings, including $1.9M earned on previously paid IEEPA tariffs 10.
Nine-month operating cash flow rose, and debt maturities are being prefunded
Net cash from operating activities was $907.3M in the first nine months against $490.0M a year earlier 32. The filing cites improved operating results, $43.4M of IEEPA refund proceeds, and a non-recurring $57.4M repatriation tax payment in 2025 33. Net earnings attributable to Hasbro for the nine months were $753.8M 17.
Cash and equivalents were $850.7M and short-term investments $576.2M at quarter end 29. Of $3.5B of long-term debt, $893.9M is current, covering notes due November 2026 and September 2027 31. Nine-month purchases of short-term investments were $472.7M to prefund those maturities 33.
What to watch next
Management raised 2026 guidance to revenue up 7-9% in constant currency (previously 5-7%), adjusted operating margin of 27-28% (previously 25-26%) and adjusted EBITDA of $1.575B to $1.625B (previously $1.45B to $1.50B), and said it is doubling its 2026 share repurchase target 8-K.
The remaining $13.0M of IEEPA refunds is expected within six months, and the release flags risk around their amount and timing 2.
Magic's weight in sales and profits is flagged as a risk, so the pace of the set lineup behind it matters for the fourth quarter and 2027 8-K.
Sources
Produced by Clarifo Research with the Clarifo financial research engine from the company's public filings. AI was used in parts of the analysis and drafting. Figures are checked automatically against the filings they come from. This is not investment advice.