Toy manufacturing giant Hasbro Inc. is set to undergo a substantial workforce reduction, with CEO Chris Cooks revealing that nearly 20% of the global workforce, approximately 1,100 employees, will be affected. This move comes on the heels of consecutive quarters of declining toy sales, posing significant challenges for the company.

In a memo to staff on Monday, Cooks acknowledged the difficulty of the decision, especially during the holiday season. Hasbro, known for iconic games like Monopoly and Candy Land, experienced weak toy sales throughout 2023, extending into the crucial holiday shopping season. The company expects this trend to persist into the new year.

“We anticipated the first three quarters to be challenging, particularly in Toys, where the market is coming off historic, pandemic-driven highs,” Cooks explained to staff. He noted that the headwinds observed in the first nine months of the year are likely to continue into 2024.

To position the company for future growth, Cooks emphasized the need to ensure a solid and profitable foundation, necessitating a leaner operational structure. Despite viewing workforce reductions as a last resort, Cooks stressed that, given the current state of the business, it is a necessary step to maintain the health of Hasbro.

The impact of the layoffs will be felt by many employees, with notifications expected to be completed by Tuesday, although timings will vary by country. The majority of notifications will occur over the next six months, as outlined in a regulatory filing by the company.

The extensive layoffs are part of a broader strategy to streamline operations and enhance profitability. Hasbro anticipates completing the workforce reduction over the next 18 to 24 months. As the company faces the challenges of evolving market dynamics and shifting consumer preferences, the restructuring aims to position Hasbro for sustained success in the ever-evolving toy and entertainment industry.

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