Magic Hits $1 Billion

Stonks Chris Cocks New York Times Magic the Gathering

Hasbro celebrates an impressive Magic: the Gathering milestone at the beginning of a company-wide downturn.

It’s official: Magic: the Gathering has become Hasbro’s first “Billion Dollar Brand”, brining in a total of $1.065B in gross sales for the 2022 calendar year.

Magic the Gathering Revenue from 2016-2022

Year	MTG	% Growth
2016	$350.0M	
2017	$375.0M	7%
2018	$400.0M	6%
2019	$424.3M	6%
2020	$581.2M	27%
2021	$995.5M	42%
2022	$1.1B	7%
Annual Revenue of Magic: the Gathering, 2016 – 2022 presented by “Cardboard by the Numbers”

The year started off strong, with Kamigawa: Neon Dynasty claiming the spot as the third best-selling expansion, the best-selling Winter set of all time, and only the 5th expansion with over $100M in sales. By the end of the year, the number of $100M+ sets had nearly doubled, with every major expansion joining the club, or, in the case of The Brother’s War, on track to shortly. 

While Magic’s actual sales numbers have typically been obscured or aggregated into larger categories, this year offers a rare insight into the staggering growth of the trading card game. Most interestingly, the relatively small growth rate of 7% over 2021’s numbers reveals just how close Hasbro was to hitting the billion threshold with their card game last year: 2021 saw an unbelievable 42% shift upwards over the prior year, yet ended just $4M and change from the finish line. 

What’s also compelling is just how critical Magic is to Hasbro’s bottom line, something underscored consistently in the last year of investor relations documents. For the last few years, Wizards of the Coast has made up an increasingly large slice of Hasbro’s overall operating profit, with this year moving up to 60% of the total. While EBITA (earnings before interest, taxes, and amortization) is a better gauge of financial success than pure sales or operating profit, it’s hard to deny Magic’s importance when its revenue has gone up while the consumer goods side of Hasbro has trended in the other direction.

The 2022 numbers show that Jace and friends now bring in 4 out of every 5 dollars Wizards generates.

For all the talk about how critical D&D is to Wizards of the Coast, it’s easy to see why executives may have been desperate to find ways to shake up their other legacy brand for revenue recently. Where Magic represented just over half of WotC’s total earnings five years ago, the 2022 numbers show that Jace and friends now bring in 4 out of every 5 dollars Wizards generates. 

The years between 2016 and 2019 have been called a “plateau” by then-Wizards of the Coast CEO/current Hasbro CEO Chris Cocks. A quick look at the last seven years of Magic’s revenue shows that to be true — the game grew slower than the stock market during those years, and dramatically underperformed the gaming segment as a whole. 

To put a fine point on it: betting on Magic in the era of Ixalan would have given you 1/3 the payout than buying stock in the average video game publisher. This is certainly no longer the case.

Where will Magic go from here? Credible threats to the games’ continued growth loom: Hasbro has updated its projections to single-digit growth over the next 5 years, with negative revenue for at least 2023. Ahead of this, the company will lay off as much as 15% of its workforce. With Magic taking up an ever-larger share of the total Hasbro revenue — nearly 20% in 2022, when it was hovering at 6% just a few years ago — will corporate leadership need to lean on Magic even more?

2022 saw as many unique Magic cards printed as the first 5 years of the game combined.

How to draw more revenue from Magic? The easiest answer was outlined in the 30th Anniversary video late last year, and reiterated again between the lines of the 2022 financial report: more Magic. Initiatives like Warhammer 40k have proven among the most successful Magic’s done to date, but can additional Universes Beyond expansions repeat that success? Will further increases to the release calendar backfire now that the online consensus seems to be that the game is already oversaturated with new cards? 

Even the New York Times shows skepticism, citing the Bank of America report on how overly busy the schedule has been. And how could they not? 2022 saw as many unique Magic cards printed as the first 5 years of the game combined. The dangers of printing new cards without the requisite thoughtfulness on the gameplay were felt very clearly by the player base in the late 2010s, hence the aforementioned “plateau”.

Player interest in not dwindling by any measurable metric, even if it has shifted in form and format. This weekend brings back the Pro Tour after a long absence, and pre-releases hit record numbers around the world for the latest expansion, Phyrexia: All Will Be One. Where Magic goes for its next 30 years remains to be seen, but for now, it’s at the top of its game.

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