Hasbro Announces Layoffs Amidst Challenging Sales

Date: 12/12./2023

Toy maker Hasbro is facing difficult times as it struggles with soft sales that have continued into the holiday shopping season. In an internal memo obtained by CNBC, CEO Chris Cocks announced that approximately 1,100 employees will be laid off, adding to the previous reduction of around 800 positions earlier this year. The layoff decision was made after careful consideration by the leadership team.

Hasbro, which had approximately 6,300 employees earlier this year, has been grappling with market headwinds throughout 2023. The company anticipated a challenging year, particularly in the toy sector, which was experiencing a decline after pandemic-related highs. Despite making progress organizationally, the difficulties persisted and are expected to extend into 2024.

To facilitate future growth, Hasbro aims to ensure a solid and profitable foundation. To achieve this, the company intends to modernize its organization and streamline operations further. While workforce reductions are viewed as a last resort, given the current state of the business, they are necessary to secure the company's health.

The layoffs will be executed over the next six months, with the remaining workforce adjustments carried out within the next year as part of ongoing organizational restructuring. Various functional areas will be affected, and employees impacted by the changes will be notified individually, with provisions for voluntary retirement programs and comprehensive support packages to aid in their transition.

Hasbro acknowledges that the timing of these layoffs, coinciding with the holiday season, is unfortunate. Employees are valued greatly, and communicating the decision now allows sufficient time for planning and adjustment. Additionally, the company has taken steps to minimize the overall impact, such as exploring real estate footprint reduction and offering job placement support.

Looking ahead, Hasbro remains committed to growth and investment in key areas. Cost savings will be reinvested in systems, insights, product development, and digital initiatives. The company aims to strengthen existing franchises, ensure effective marketing strategies, and capitalize on untapped opportunities, such as supply chain efficiency and direct-to-consumer capabilities.

Hasbro acknowledges the challenges that lie ahead and expresses gratitude to the employees directly affected by the layoffs for their contributions. The company encourages unity and support among the remaining workforce to navigate these necessary changes successfully, restore growth, and uphold Hasbro's mission.

Source: CNBC