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Revenue Recognition | 6 Months Ended
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Jun. 30, 2024
Revenue from Contract with Customer [Abstract] |
Revenue Recognition | Revenue Recognition Revenue is recognized when control of the promised goods, functional intellectual property or production is transferred to the customers or licensees, in an amount that reflects the consideration the Company expects to be entitled to in exchange for transferring those goods. The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance, and collectability of consideration is probable. The majority of the Company’s revenues are derived from sales of finished products to customers. See note 1 of the Company's 2023 Annual Report for the Company's revenue recognition accounting policy. Contract Assets and Liabilities In the ordinary course of business, the Company’s Consumer Products, Wizards of the Coast and Digital Gaming and Entertainment segments enter into contracts to license certain of the Company’s intellectual property, providing licensees right-to-use or access such intellectual property for use in the production and sale of consumer products and digital game development, and for use within content for distribution over streaming platforms and for television and film. The Company also licenses owned television and film content for distribution to third parties in formats that include broadcast, digital streaming and theatrical. Through these arrangements, the Company may receive advanced royalty payments from licensees, either in advance of a licensees’ subsequent sales to customers or, prior to the completion of the Company’s performance obligation. In addition, the Company’s Wizards of the Coast and Digital Gaming segment may receive advanced payments from end users of its digital games at the time of the initial purchase, through in-application purchases or through subscription services. These digital gaming revenues are recognized over a period of time, determined based on player usage patterns or the estimated playing life of the user, or when additional downloadable content is made available, or as with subscription services, ratably over the subscription term. The Company defers revenues on all licensee and digital gaming advanced payments until the respective performance obligations are satisfied. The Company records the aggregate deferred revenues as contract liabilities, with the current portion recorded within Accrued liabilities and the long-term portion recorded as Other non-current liabilities in the Company’s Consolidated Balance Sheets. The Company records contract assets, primarily related to (1) minimum guarantees being recognized in advance of contractual invoicing, which are recognized ratably over the terms of the respective license periods, and (2) film and television distribution revenues recorded for content delivered, where payment will occur over the license term. The current portion of contract assets is recorded in Prepaid expenses and Other current assets and the long-term portion is recorded within Other long-term assets. The changes in carrying amounts of contract assets and liabilities for the six months ended June 30, 2024 and July 2, 2023 are as follows:
| June 30, 2024 |  | July 2, 2023
Assets |  |  |
Balance at beginning of the year | $ | 213.3 |  |  | $ | 594.4 |
Recognized in current year | 135.8 |  |  | 320.3 |
Amounts reclassified to accounts receivable | (109.6) |  |  | (352.1) |
Foreign currency impact | (2.3) |  |  | 7.3 |
Ending Balance | $ | 237.2 |  |  | $ | 569.9 |
Liabilities |  |  |
Balance at beginning of the year | $ | 230.8 |  |  | $ | 113.0 |
Recognized in current year | 131.9 |  |  | 164.0 |
Amounts in beginning balance reclassified to revenue | (45.4) |  |  | (58.8) |
Current year amounts reclassified to revenue | (58.5) |  |  | (97.9) |
Foreign currency impact | 0.1 |  |  | (1.0) |
Ending Balance | $ | 258.9 |  |  | $ | 119.3 |
Unsatisfied performance obligations Unsatisfied performance obligations relate primarily to in-production television content to be delivered in the future under existing agreements with partnering content providers such as broadcasters, distributors, television networks and subscription video on demand services. As of June 30, 2024, unrecognized revenue attributable to unsatisfied performance obligations expected to be recognized in the future was $2.4 million. Of this amount, we expect to recognize $1.5 million in the remainder of 2024 and $0.9 million in 2025. These amounts include only fixed consideration. Accounts Receivable and Allowance for Credit Losses The Company’s balance for accounts receivable on the Consolidated Balance Sheets as of June 30, 2024 and July 2, 2023 are primarily from contracts with customers. A summary of the activity in the allowance for credit losses for the six months ended June 30, 2024 and July 2, 2023 are as follows:
| June 30, 2024 |  | July 2, 2023
Balance at beginning of the year | $ | 12.7 |  |  | $ | 20.0 |
Charged to costs and expenses, net | 1.8 |  |  | 1.5 |
Customer accounts written off—net of recoveries | (0.6) |  |  | — |
Foreign currency impact | (0.8) |  |  | 0.7 |
Ending balance | $ | 13.1 |  |  | $ | 22.2 |
Disaggregation of revenues The Company disaggregates its revenues from contracts with customers by reportable segment: Consumer Products, Wizards of the Coast and Digital Gaming, and Entertainment. The Company further disaggregates revenues within its Consumer Products segment by major geographic region: North America, Europe, Latin America, and Asia Pacific; within its Wizards of the Coast and Digital Gaming segment by category: Tabletop Gaming and Digital and Licensed Gaming; and within its Entertainment segment by category: Film & TV, Family Brands, and Other. Finally, the Company disaggregates its revenues by brand portfolio into three brand categories: Franchise Brands, Partner Brands and Portfolio Brands. We believe these collectively depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Effective in the first quarter of 2024, subsequent to the sale of the eOne Film and TV business (as defined in Note 3), the Company moved the remaining Non-Hasbro Branded Film & TV brands into Portfolio Brands to align with the Company's Brand Strategy. For comparability, net revenues for the three and six months ended July 2, 2023, have been reclassified to reflect the movement, resulting in a change of $0.8 million and $0.9 million, respectively. The following table represents consolidated Consumer Products segment net revenues by major geographic region for the three and six months ended June 30, 2024 and July 2, 2023:
| Three Months Ended |  | Six Months Ended
| June 30, 2024 |  | July 2, 2023 |  | June 30, 2024 |  | July 2, 2023
North America | $ | 306.1 |  |  | $ | 382.0 |  |  | $ | 545.2 |  |  | $ | 661.1 |
Europe | 92.0 |  |  | 131.9 |  |  | 179.5 |  |  | 263.5 |
Asia Pacific | 62.6 |  |  | 66.4 |  |  | 111.4 |  |  | 129.7 |
Latin America | 63.8 |  |  | 74.9 |  |  | 101.4 |  |  | 121.3 |
Net revenues | $ | 524.5 |  |  | $ | 655.2 |  |  | $ | 937.5 |  |  | $ | 1,175.6 |
The following table represents consolidated Wizards of the Coast and Digital Gaming segment net revenues by category for the three and six months ended June 30, 2024 and July 2, 2023:
| Three Months Ended |  | Six Months Ended
| June 30, 2024 |  | July 2, 2023 |  | June 30, 2024 |  | July 2, 2023
Tabletop Gaming | $ | 307.6 |  |  | $ | 298.5 |  |  | $ | 535.8 |  |  | $ | 516.4 |
Digital and Licensed Gaming | 144.4 |  |  | 77.1 |  |  | 232.5 |  |  | 154.4 |
Net revenues | $ | 452.0 |  |  | $ | 375.6 |  |  | $ | 768.3 |  |  | $ | 670.8 |
The following table represents consolidated Entertainment segment net revenues by category for the three and six months ended June 30, 2024 and July 2, 2023:
| Three Months Ended |  | Six Months Ended
| June 30, 2024 |  | July 2, 2023 |  | June 30, 2024 |  | July 2, 2023
Film and TV (1) | $ | 1.8 |  |  | $ | 153.3 |  |  | $ | 1.8 |  |  | $ | 321.7 |
Family Brands | 17.0 |  |  | 25.9 |  |  | 45.0 |  |  | 42.9 |
Net revenues | $ | 18.8 |  |  | $ | 179.2 |  |  | $ | 46.8 |  |  | $ | 364.6 |
(1) Net revenues from the Company's Film and TV portfolio were primarily associated with the Company's non-core eOne Film and TV business sold to Lionsgate during the fourth quarter of 2023. The following table presents consolidated net revenues by brand portfolio for the three and six months ended June 30, 2024 and July 2, 2023:
| Three Months Ended |  | Six Months Ended
| June 30, 2024 |  | July 2, 2023 |  | June 30, 2024 |  | July 2, 2023
Franchise Brands | $ | 786.6 |  |  | $ | 788.4 |  |  | $ | 1,393.1 |  |  | $ | 1,401.8 |
Partner Brands | 124.6 |  |  | 172.9 |  |  | 212.3 |  |  | 305.6 |
Portfolio Brands | 84.1 |  |  | 107.9 |  |  | 147.2 |  |  | 200.0 |
Non-Hasbro Branded Film & TV (1) | — |  |  | 140.8 |  |  | — |  |  | 303.6 |
Net revenues | $ | 995.3 |  |  | $ | 1,210.0 |  |  | $ | 1,752.6 |  |  | $ | 2,211.0 |
(1) Net revenues from the Company's Non-Hasbro-branded Film and TV portfolio were associated with the Company's non-core eOne Film and TV business sold to Lionsgate during the fourth quarter of 2023.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 9 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-9 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 10 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-10 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-15 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-13 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 606 -Publisher FASB -URI https://asc.fasb.org/606/tableOfContent + Details
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