Games

Hasbro's Profits Soar Thanks to Baldur's Gate 3 Licensing Deal

Despite not directly creating Baldur's Gate 3, Hasbro has struck gold with a lucrative licensing agreement, riding the wave of the game's immense popularity and critical acclaim.
Hasbro's Profits Soar Thanks to Baldur's Gate 3 Licensing Deal

Highlights

  • Hasbro has raked in $90 million from licensing agreements related to Baldur's Gate 3, leading to a 7% rise in earnings for Wizards of the Coast.
  • Despite the triumph of Baldur's Gate 3, Hasbro faced a 15% drop in revenue and had to lay off approximately 1,100 employees in 2023.
  • The success of Baldur's Gate 3 has not only boosted interest and revenues for Dungeons and Dragons but also contributed to the overall growth of the franchise.

Since its launch in August 2023, Baldur’s Gate 3 has been a cash cow for Hasbro, bringing in a whopping $90 million. Although Hasbro wasn't directly involved in creating the game, it has profited immensely from a licensing deal brokered between Larian Studios and Wizards of the Coast.

With numerous accolades, including the prestigious Game of the Year 2023 title, Baldur’s Gate 3 has become a household name in the gaming community since its debut last year. Developed by Larian Studios, the game utilizes a modified version of the 5th Edition Dungeons and Dragons rules and is set in the renowned Forgotten Realms universe, a popular backdrop for many Dungeons and Dragons adventures. This partnership necessitated a licensing agreement between Larian Studios and Hasbro via Wizards of the Coast to bring Baldur’s Gate 3 to life.

During Hasbro's financial briefing for the fourth quarter of 2023, it was revealed that the licensing deal surrounding Baldur’s Gate 3 proved to be a lucrative move, contributing significantly to the 7% earnings increase for Wizards of the Coast. While Hasbro CEO Chris Cocks acknowledged that the success could also be attributed to the popular Lord of the Rings themed set that Magic: The Gathering had launched around the same time, Baldur’s Gate 3 played a pivotal role in this financial upswing. The company estimates that the licensing deal related to Dungeons and Dragons has generated around $90 million in revenue since its inception.

Hasbro's $90 Million Windfall from BG3 Licensing Deals

Despite this triumph, Hasbro faced financial challenges in 2023. The conglomerate witnessed a 15% decline in revenue, resulting in a collective loss of approximately $1.5 billion across its various divisions. Prior to the holiday season, Hasbro had to lay off about 1,100 employees, including staff from Wizards of the Coast who collaborated on Baldur’s Gate 3. Nevertheless, Cocks remains hopeful about Hasbro's future, stating, "Our revamped leadership team is introducing innovative products to our loyal fan base. Additionally, we are strategically reshaping Hasbro to drive sustainable growth, beginning with a substantial profit increase across our segments in 2024, and we aim to build momentum in our innovation pipeline leading up to 2025."

The resurgence of Dungeons and Dragons is undeniable. The heightened popularity of entertainment entities like Critical Role and its upcoming animated show, The Legend of Vox Machina, has thrust the game into the spotlight, with even shows like Stranger Things integrating Dungeons and Dragons into mainstream culture. The success of Baldur’s Gate 3 has only added to this momentum, indicating a significant uptick in interest and revenue for Dungeons and Dragons.

Recently, Wizards of the Coast unveiled release dates for several Dungeons and Dragons publications throughout 2024. The company is slated to release updated versions of the Player’s Handbook, Dungeon Master’s Guide, and Monster Manual towards the end of 2024 and early 2025. Fans eagerly anticipate how these new Core rulebooks, in conjunction with Hasbro's strategic approach of "Fewer, Bigger, Better," will impact the franchise's financial trajectory in the coming years.

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