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Hasbro stock rose 11% after Q3 2026 earnings beat estimates, guidance rose and the buyback target doubled as Magic: The Gathering passed $600M in revenue.
- Hasbro Q3 adjusted EPS was $2.90 against a $1.86 consensus; revenue rose 15% to $1.595 billion.
- Magic: The Gathering revenue hit a record $616.1 million, up 34%, the first quarter above $600 million.
- Full-year adjusted EBITDA guidance rose to $1.575-$1.625 billion; the 2026 buyback target doubled to at least $200 million.
Lead
Hasbro (NASDAQ: HAS) shares rose 11.2% to close at $109.53 on Tuesday, October 20, after the toymaker reported third-quarter results that beat Wall Street estimates, raised its 2026 outlook and doubled its share repurchase target. Adjusted earnings were $2.90 per diluted share, well above the $1.86 consensus. Net revenue of $1.595 billion topped the roughly $1.48 billion expected and marked the fourth consecutive quarter of double-digit growth.What Did Hasbro Report for the Third Quarter?
Hasbro reported GAAP operating profit of $517.3 million, net earnings of $394.5 million and GAAP earnings of $2.77 per share. Revenue for the first nine months reached $3.735 billion, up 15%, with adjusted earnings of $5.65 per share.
The Wizards of the Coast and Digital Gaming segment generated $747.2 million in revenue, up 31%. Segment operating profit rose 46% to $367 million, a 49% margin. Consumer Products revenue grew 4% to $827.9 million, while its adjusted operating profit doubled to $178 million. Entertainment revenue rose 9% to $20.2 million.
The quarter included about $55 million of tariff refunds, which contributed to profit. Hasbro generated about $759 million of free cash flow over the first nine months, from $907.3 million in operating cash flow and $148.5 million in capital spending.
How Big Did Magic: The Gathering Get?
Magic: The Gathering generated $616.1 million in revenue in the quarter, up 34% from a year earlier, the first time the franchise has exceeded $600 million in a single quarter. Year-to-date Magic revenue stands at $1.631 billion, also up 34%.The result confirms the card game as the profit engine of the company. Wizards of the Coast now earns margins close to 50%, well above the toy and licensing businesses. Digital gaming added to the segment's growth, with Monopoly Go! contributing $41 million in the quarter and $127 million so far this year.
What Changed in Hasbro's 2026 Outlook?
Hasbro raised every headline full-year metric. It now expects revenue growth of 7-9% in constant currency, up from 5-7%. Adjusted operating margin is guided to 27-28%, from 25-26%. Adjusted EBITDA is now forecast at $1.575-$1.625 billion, up from $1.45-$1.50 billion.
On capital returns, the company doubled its 2026 share repurchase target to at least $200 million from at least $100 million. It spent $79 million on buybacks in the third quarter and $149.3 million year to date. Including the $0.70 quarterly dividend, Hasbro returned $206 million to shareholders in the quarter.
CEO Chris Cocks said the company delivered a fourth consecutive quarter of double-digit revenue growth. CFO Gina Goetter said the raised outlook and larger repurchase target balance investment in the business with returns to shareholders.
Why Did Hasbro Shares React This Way?
Hasbro shares jumped because the quarter beat on revenue and earnings and also lifted the expected profit level for the full year. The EPS beat of more than $1.00 was among the largest of the season for a consumer company, and the EBITDA guidance increase of $125 million at both ends of the range signals higher profit, not just higher sales.
The move also reflects a change in the mix of earnings. Wizards of the Coast, with its high-margin, recurring product releases, accounts for a growing share of operating profit. That shifts the company's profile toward a gaming and licensing business rather than a cyclical toy maker exposed to holiday retail and tariff costs. The shares trade near a 2.6% dividend yield, and the rally leaves them well above levels seen earlier in the year.
What Comes Next for Hasbro?
The fourth quarter is the key test. Holiday demand will determine whether Consumer Products can sustain its profit recovery without the one-time help from tariff refunds, and whether Magic can hold growth in the 30% range against tougher comparisons. The raised guidance implies the company expects both to hold.
Capital allocation is the second watch point. A buyback of at least $200 million remains modest relative to Hasbro's cash generation, leaving room for further increases if cash flow stays strong. Tariff policy remains a variable for Consumer Products, since refunds recorded this quarter do not recur by design.
Outlook
Hasbro enters the final quarter of 2026 with record Magic revenue, four straight quarters of double-digit growth and a higher full-year profit target. The business is increasingly defined by the margin strength of its gaming segment, while Consumer Products has to prove that its improved profitability can persist without tariff refunds.
