Hasbro Q4 2019 Earnings – Recap of all MTG Arena Information from the Call

Brian D. Goldner – Chairman of the Board and Chief Executive Officer
Magic: The Gathering revenues increased more than 30% in the year, behind double-digit growth in tabletop play and a strong first year for Magic: The Gathering Arena. Dungeons & Dragons revenues grew for the sixth straight year, and we are meaningfully investing in both brands to drive engaging storytelling, while developing new digital games with high margin profitable growth longer term. We look forward to sharing our 2020 new gaming plans for Magic and D&D on February 21. MONOPOLY had double-digit revenue growth and grew in each region with new themes and relevant entertainment tie-ins.

Entertainment, Licensing and Digital segment revenues increased 22% with growth in digital gaming led by Magic: The Gathering Arena, and revenues from the Bumblebee film and in consumer products licensing.

Adjusted operating profit and profit margin declined as we invest in digital gaming initiatives including Magic: The Gathering Arena and future Magic and Dungeons & Dragons digital games.

Ashley Helgans – Jefferies – Analyst
Hi, good morning. This is Ashley Helgans on for Steph. Thanks for taking our questions. So digital gaming put up impressive growth. Can you speak to the key measures you’re seeing that give you confidence in credit sustainability? And what can we expect in 2020 in terms of new digital games or features?

Brian D. Goldner – Chairman of the Board and Chief Executive Officer
Sure. Well, good morning, and we did see very strong growth for Magic: The Gathering and increased growth for Dungeons & Dragons. And for Magic, it really was growth in two fronts. First, our tabletop game grew substantially, and that brings a lot of new players and unique players into the game. So, we saw growth in unique players and we also saw growth for all the events. And our revenue for was up. And of course in the fourth quarter, it was down as we had described because of the release cadence and the release timing. We’ve seen a lot of engagement across an array of new offerings there. For Magic: The Gathering Arena, we saw great growth for the brand, that aspect of the throughout the year.

Magic Arena was ranked as a top esports brand number seven. It was also one of the top 10 reviewed games from Metacritic. We’ve seen over 1.8 billion games played thus far, 72% growth in new players for the year. And on average Magic players — Arena players continue to spend about eight hours a week. We’re also seeing incredible streaming metrics, 43% growth in viewer hours year-to-year. We are seeing over 70,000 streamers since the open beta, and it continues to be a top 20 game on Twitch week-to-week.

In January, just a few weeks ago, we began the launch of Magic: The Gathering Arena on the Epic Games Store. So that gives us access to 100 million PC gamers and we’re just ramping up the marketing to bring in more Magic players as we go forward. We’re very excited about some other new initiatives that will continue to drive our partnership with Tencent. We’ll will also talk more about our migration to mobile, and Chris will outline our 2020 plans on the 21st.

In addition, for D&D, we did see our sixth straight year of growth. We are seeing about 150 million hours of content viewed on Twitch and YouTube, which is up nearly 50% year-on-year. In the first half of 2020, we are seeing a lot of new initiatives coming for the brand, but again I’m going to let Chris walk us through at at our Analyst Day, our plans for digital gaming, which are again substantial for D&D that begins in 2020.

Tami Zakaria – JP Morgan — Analyst
Got it. That’s helpful. And then your Entertainment, Digital and Licensing revenues were up an impressive 22% for the year. So could you provide some color on the mix of this growth coming from Bumblebee versus Magic: The Gathering Arena?

Brian D. Goldner – Chairman of the Board and Chief Executive Officer
We saw growth across each of that discrete parts of the Entertainment, Licensing and Digital business. Our consumer products, licensing business was up, our digital gaming business was up with a number of our digital games with partners performing incredibly well, including YAHTZEE With Buddies, which was a top 50-game on the Apple App Store. We had a new MONOPOLY game launching from Marmalade Studio that launched in December and chartered as number one as it launched. Our POWER RANGERS digital games continue to perform well. And in the first quarter 2020, we have a G.I. Joe game in support of the brand, called G.I. Joe: War on Cobra that launches in Q1, as well as Scrabble GO game that will launch from Scopely in Q1.

So digital gaming grew, our entertainment business grew, and our Wizards digital business all grew in 2019. Arena grew throughout the year. Arena grew in the fourth quarter, offset by a bit of decline in the legacy Magic: The Gathering online business. But overall Arena had a fantastic year and we expect continued progress as I outlined, expansion of the brand across multiple platforms for 2020.

Michael Ng – Goldman Sachs — Analyst
And then for Brian, I was just wondering if you could talk a little bit more about the engagement and revenue trends for Magic Arena. How did that look in the quarter relative to earlier in the year, for instance? Thank you.

Brian D. Goldner – Chairman of the Board and Chief Executive Officer
And for Magic: The Gathering, as you know, Mike, it operates on a number of levels and the brand was up more than 30% for the year. And you can’t underestimate the power of all of the storytelling that comes from the card releases and the fact that the tabletop game was up in such a substantial way with engagement around events and unique players, all pointing to incredibly strong metrics. Our digital Magic Arena business also grew several fold throughout the year, and we saw strength in each and every quarter, including growth in the fourth quarter. We were gearing up for and have now executed Magic Arena on the Epic Games Store, which just occurred and we’re really going to be ramping up all of the marketing in partnership with Epic to bring Magic to more gamers than ever before. Magic Arena will move to mobile through — in the year in 2020. I’m going to let Chris outline the plans there, but that’s incredibly exciting as we give more people access to Magic Arena, recognize it’s been a PC based games thus far. As well our partnership with Tencent, we expect that to ramp and to have an impact on the brand in 2020 as we look at new markets and new geographies around the world.

In addition to that, for Magic, you will see a new game launch this year in Magic in the casual arena. And I’ll let Chris walk you through that. You’ll also see great digital game development for D&D. And we will see you on February 21 to outline that.