Hasbro Outperforms Mattel as "Wizards of the Coast" Drives Growth

In the high-stakes battle for toy and gaming supremacy, Hasbro has firmly established a lead over its chief rival, Mattel. Recent financial disclosures for the 2025 fiscal year and initial 2026 outlooks reveal a "tale of two toy companies." While Mattel grapples with stagnant growth and a "Barbie hangover" following its 2024 cinematic peak, Hasbro is riding a wave of record-breaking success fueled by its most powerful subsidiary: Wizards of the Coast (WotC).

The performance gap is stark. Hasbro’s total revenue climbed approximately 14% to $4.7 billion in 2025, while Mattel’s net sales dipped 1%. The disparity is largely attributed to Hasbro's strategic pivot toward high-margin digital and tabletop gaming, anchored by the iconic Magic: The Gathering and Dungeons & Dragons intellectual properties.

The Crown Jewel: Magic: The Gathering

Wizards of the Coast has become the undisputed engine of Hasbro’s growth. In the fourth quarter of 2025 alone, the segment’s revenue skyrocketed 86%, reaching $630.4 million. The standout performer, Magic: The Gathering (MTG), saw its revenue jump 141% in that same period, powered by the explosive success of the Avatar: The Last Airbender and Final Fantasy expansion sets.

The MTG brand achieved a historic milestone in 2025, generating $1.7 billion in revenue—a 59% year-over-year increase. This surge is credited to the "Universes Beyond" strategy, which integrates external blockbuster IPs into the core card game mechanics. By transforming the game into a "platform" for various fanbases—including upcoming 2026 collaborations with Marvel, Star Trek, and Teenage Mutant Ninja Turtles—Hasbro has effectively decoupled its valuation from the traditional, hit-driven toy market.

Stagnation at Mattel: The Post-Movie Landscape

In contrast, Mattel is navigating a period of restructuring. Following the massive success of the Barbie movie, the brand has struggled to maintain that momentum, with Barbie sales declining 7% in 2025. Compounding these issues, Mattel reported that the critical 2025 holiday shopping season in the U.S. fell flat, leading to a 24% plummet in stock price following its February 2026 earnings report.

Mattel CEO Ynon Kreiz has categorized 2026 as an "inflection year," during which the company will invest approximately $150 million to bolster its own digital gaming and IP capabilities. This includes the $159 million acquisition of the mobile game studio Mattel163. While intended to bridge the digital gap with Hasbro, these near-term investments have pressured margins, leading to a cautious forecast for the year ahead.

Omnichannel Implications and the "Kidult" Surge

The shift in dominance highlights a broader trend in the omnichannel retail landscape: the rise of the "kidult" demographic. Consumers aged 13 and older now account for a significant and growing portion of toy and game industry profits. These shoppers are less susceptible to the seasonal volatility of traditional toy cycles and are more likely to engage with high-margin, recurring revenue streams like collectible card games and digital platforms.

For retailers in Bentonville and beyond, this shift requires a reimagining of the toy aisle. Success in the current environment depends on the ability to merge physical products with digital engagement and community-driven experiences. Hasbro’s "Playing to Win" strategy, which emphasizes a digital-first approach, has allowed the company to engage over one billion fans worldwide, creating a "virtuous cycle" where increased distribution leads to higher organized play participation and longer-term customer retention.

Outlook for 2026 and Beyond

As 2026 unfolds, Hasbro expects to maintain its momentum with a forecasted revenue growth of 3% to 5%. The company’s focus remains on its "Universes Beyond" roadmap and the continued expansion of the Wizards Play Network, which grew 20% last year. Meanwhile, Mattel’s path to recovery depends on the successful execution of its digital pivot and the stabilization of its core legacy brands like Hot Wheels and Fisher-Price.

The diverging paths of these two industry giants underscore a critical lesson for modern retail: in an omnichannel world, owned intellectual property—and the ability to scale it across digital and physical platforms—is the ultimate competitive advantage.