Hasbro, Inc. (NASDAQ:HAS) has long counted on licensing partnerships to help it become one of the two largest toymakers in the United States. The company has seen revenue increase over the last five years on the success of boys and girls toys, and also a growing demand for interactive toys. The company has a partnership that could transform the interactive segment and produce strong returns for shareholders.
Hasbro, Inc. (NASDAQ:HAS) will launch toys in partnership with Rovio’s “Angry Birds Star Wars II.” The game follows up the highly successful “Angry Birds Star Wars”, which has seen more than 100 million downloads. The game will be released Sept. 19 on mobile phones and tablets. For the first time in the Angry Birds game line, interactive toys will be released. Thirty telepods, which are physical versions of characters, will be playable through a phone or tablet’s camera.
The game’s plot will center around the three prequel Star Wars movies. New characters like Mace Windu and Darth Maul will be introduced. (No word yet on if Jar Jar Binks will be included and what power he will have from the slingshot.) As a mobile game, telepods won’t be included and will have to be purchased from physical stores. This gives Hasbro, Inc. (NASDAQ:HAS) the upper hand in interactive gaming.
In the first quarter, Hasbro, Inc. (NASDAQ:HAS) saw revenue increase 2% to $663.7 million. Revenue increased 4% in North America and was relatively flat in international markets. The company’s Angry Birds line was noted as a strong seller in the quarter. Expect strong sales of the Angry Birds line to contribute to fiscal-year revenue and earnings. Hasbro could be in for several strong quarters and should see shares trade higher after results.
In the third quarter, which includes September and initial sales of Angry Bird Star Wars toys, analysts expect Hasbro, Inc. (NASDAQ:HAS) to post revenue of $1.35 billion. This amount is only 0.3% higher than the previous year. I have to think that Hasbro, Inc. (NASDAQ:HAS) could shatter that estimate with strong Angry Bird-related sales. Earnings per share are estimated at $1.29 for the quarter, which could also come in higher with high margin telepod sales.
The telepods will come in packs ranging in price from $5.99 to $39.99. The cheapest will include several figures, while the big packs are being labeled the “Star Destroyer set”, with a possible toy included. The first “Star Wars Angry Birds” game had 100 million downloads. If 25% of users bought a telepod pack, sales would be $150 million. That amount would be split between Hasbro and Rovio, but should boost estimates for the quarter by at least $50 million.
Another interesting point to consider is the recent development from Activision. Rival video-game maker Activision Blizzard, Inc. (NASDAQ:ATVI) will be bringing the first “Star Wars Angry Birds” game to consoles. This move, mentioned on The Motley Fool, should boost product sales from Hasbro and Rovio centered on the first game.
In August, The Walt Disney Company (NYSE:DIS)’s interactive business segment will launch an interactive toy game, “The Walt Disney Company (NYSE:DIS) Infinity.” The game, which was supposed to be released in June, allows customers to purchase additional characters from The Walt Disney Company (NYSE:DIS) and Pixar movies to use as playable characters in the game. The game will be available for consoles.