The holiday season was a tough one for many toy companies, and Toronto-based Spin Master was no exception. 

In its preliminary Q4 results, the company has reported US$465.8 million in total revenue, down 24.9% compared to the same quarter last year. The toys segment was hit hardest, posting a 26.8% decline to US$396.7 million. And gross toy sales for the quarter also dropped by 23.6%, from US$627.5 million in 2022 to US$479.2 million this year. 

Max Rangel, Spin Master’s CEO and president, attributed the revenue shortage to economic conditions, lower consumer demand and retailers ordering more toys earlier in the year to mitigate supply chain issues. “As expected, toy revenue in the second half of 2022 was pressured by changes in the macroeconomic environment, particularly from higher inflation compounded by foreign exchange volatility and a carry-over of inventory at retail from the first half of 2022,” he said in a release. 

In the company’s digital games segment, Q4 revenue is down by 24.2% to US$37.9 million, largely driven by fewer in-app purchases in the mobile game Toca Life World. Entertainment was the only segment to show growth, with revenue up 9.5% to US$31.2 million from licensing and merchandising sales. 

Spin Master’s preliminary results for the whole year, however, have total 2022 revenue down by just 1.1% to roughly US$2 billion. Shortfalls in digital games and entertainment were offset by toys, where annual revenue was up marginally (0.03%) to US$1.74 billion. 

Spin Master will report its fiscal financial results after the markets close on March 8.