In today’s investor call, Hasbro revealed that Magic: The Gathering revenue grew 40% year-over-year in the fourth quarter of 2022 to $263.2 million. Magic’s revenue for the full year of 2022 was up 7% to $1.0652 billion.
Wizards of the Coast, which creates Magic, saw its overall fourth quarter revenue grow by 22% to $339 million, while its quarterly profits were up 23% year-over-year to $104 million.
Wizards of the Coast Q4 2022 financials. (Source: Hasbro)
For the full year, Wizards’ revenue grew by 3% to $1.325 billion in 2022, with an operating profit of $538 million—down 2% year-over-year.
Wizards of the Coast FY 2022 financials. (Source: Hasbro)
Hasbro attributes Magic’s strong fourth quarter to “strong initial orders of Dominaria Remastered and reorders of Warhammer 40,000” Commander decks. This helped Magic’s tabletop revenue grow by 40% to $267 million in Q4, which contributed to the tabletop segment’s revenue growing by 12% over to $1.07 billion for the full year of 2022.
During the investor call, Hasbro’s CEO Chris Cocks indicated that three of Magic’s premier sets in 2022—Kamigawa: Neon Dynasty, Streets of New Capenna, and Dominaria United—have all passed the $100 million revenue mark. The Brother’s War, the last premier set of 2022 released in November, is projected to do so as well.
Looking Ahead to 2023
Hasbro expects Wizards of the Coast’s revenue to be up in the mid-single digits in 2023, according to CEO Chris Cocks, and that Magic’s growth in 2023 will be more moderate than in previous years. More specifically, Cocks expects Wizards to be up in Q1 2023, down in Q2, “significantly” up in Q3, up again in Q4.
Q1 2023 is already off to a good start, Cocks said, with Magic’s latest sets—Phyrexia: All Will Be One and Dominaria Remastered—doing “quite well.”
He did sound a preemptive note of caution for Q2, though, saying that Hasbro is “taking the feedback to heart” around spacing out Magic releases more in order to reduce product fatigue. As a result, he expects the second quarter of 2023 to show negative growth year-over-year due shifting release schedules.
Layoffs
Three weeks ago, Hasbro announced that it would be laying off 15% of its workforce, or around 1,000 workers. These layoffs weren’t addressed in today’s investor call and Hasbro hasn’t detailed how those layoffs will impact Wizards of the Coast or Magic: the Gathering.
We have, however, seen some indication that neither Wizards nor Magic will be immune to the impacts of layoffs or general budget-tightening. On Tuesday, Carolina Moraes revealed on Twitter that she and the rest of Magic’s Latin American team had been let go.
MTG Arena is Coming to Steam in Q3 2023
Hasbro also announced that Wizards of the Coast is targeting Q3 2023 for MTG Arena’s release on Steam.
Wizards is targeting the back half of 2023 because they are currently “reinventing” Arena’s new user experience to make it “a more fun way to learn how to play,” Cocks said. They want that work to be done before Arena is released on Steam.
Wizards expects more users to join Arena with its release on Steam, which should generate “decent revenue growth” for the game, according to Cocks. He also mentioned that the Arena’s release on consoles is likely coming in 2024 or later.
Digital Multiplayer and Collectibles
While speaking of Wizards of the Coast’s digital initiatives, Cocks made a point of saying that Wizards is exploring ways to provide a digital multiplayer—i.e. Commander—experience in Arena. He didn’t have any specific announcements about that kind of functionality, though.
He also said that Wizards is continuing to explore the idea of digital collectibility. Again, he had nothing specific to announce, but he emphasized that they are going to “avoid the passing fads” in digital collectibles (likely referring to NFTs without naming them) should they choose to dive in to the space.
Neflix Show When?
It has been three and a half years since Hasbro, Wizards of the Coast, and Netflix announced that they had inked a deal for a Magic: The Gathering animated series. The show was initially headed up by the Russo brothers, directors of Avengers: Endgame, but they left the project a year later.
Following the departure of the Russo brothers, Netflix gave the show over to executive producers Jeff Kline and Steve Melching, announced that it had cast Brandon Routh as the voice of Gideon Jura, and gave it a tentative release window of late 2022. It missed that window and still hasn’t been released as of mid-February 2023.
In today’s investor call, Hasbro CEO Chris Cocks outlined their “exciting” movie and TV slate for 2023, consisting of the D&D movie Honor Among Thieves, a D&D live action series, as well as more Transformers content. However, he didn’t mention anything about the Magic Netflix show, deepening the doubts that the show will ever see the light of day.