Hasbro, Inc. HAS shares traded lower by more than 15% Tuesday in reaction to a concerning earnings report, but CEO Brian Goldner said the toymaker is in a position to grow in the fourth quarter and beyond.
What Happened
Hasbro's third quarter was negatively impacted by the U.S.-China trade war, while a new 10% tariff on toys is scheduled for Dec. 1. Beyond the headline numbers, shipments of toys picked up "appreciably" in September after two months of declines, Goldner told CNBC's Jim Cramer in a Tuesday interview.
Growth in the holiday season will come from a lineup of new products and a strategy to "get through" any tariff concerns over the longer-term, even though the impact is being felt today, Goldner said.
Navigating through tariffs is no different than changes made in the past in reaction to shifts in the toy industry and retail market, he said.
Why It's Important
Hasbro relies on Hollywood hits to drive its toy sales.
The company is seeing "very strong growth" coming from the "Star Wars" movie and "Frozen 2," Goldner told Cramer.
Other non-film related toys like the NerfUltra are also off to a "very good start," and the Play-Doh business is up year-to-date, he said.
"We've come out of the gates into the fourth quarter strongly."
What's Next
Beyond the fourth quarter of 2019, Hasbro will address any new issues "in real time" by working with retail partners, the CEO said.
At the product level the company will focus on new owned intellectual properties and stories across all age groups, he said.
"As you tell stories on great platforms, you raise the prospects for those brands."
Hasbro shares were down 0.8% at $99.22 near the end of Wednesday's session.
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