Thanks in large part to robust performances by toys tied into the blockbuster Transformers and Spider-Man 3 movies Hasbro, the nation's #2 toymaker, posted a very strong third quarter with revenues up by 18% over the same quarter in 2006.  Transformers has clearly emerged as Hasbro's number one action figure line of 2007, but Hasbro President and CEO Alfred J. Verrechia made a special point of mentioning during the Q3 earnings conference call that sales of Marvel toys 'have exceeded expectations.'  Verrechia projected that Marvel-based toys could amount to a healthy 8-10% of the company's worldwide revenues for 2007.  More than a few analysts have expressed concerns that Spider-Man 3 toys weren't moving as fast as expected at retail, but Verrechia remained bullish on the company's Marvel agreement, telling analysts that he was expecting strong performances (though not to the level of Spider-Man or Transformers) from Iron Man and Hulk toys next year in the wake of those two Marvel Studios films, which are set to debut next summer.

Sales in Hasbro's game segment were down 2% for the quarter, a decline that was attributed to slowdowns in sales of Hasbro's 'Plug 'n Play' games and in the trading card games produced by Hasbro's subsidiary Wizards of the Coast.  But if sales of TCGs declined, board game sales surged 14% during the quarter driven by an especially strong performance from the new Monopoly: Electronic Banking Edition and The Game of Life Twists & Turns, both of which update classic games with new electronic banking/Visa Card features ripped from the fabric of contemporary life.

Hasbro saw its royalty payments rise from $51.3 million in Q3 2006 to $93 million during the most recent quarter, which should provide some idea of the importance of its deal with Marvel, which reportedly received $70 million of the total. 

Hasbro hasn't unveiled its full plans for 2008, but the company clearly hopes that its partnership with videogame giant Electronic Arts will start to pay dividends and that toys based on Iron Man, Hulk and the new Indiana Jones movie will make up at least in part for the inevitable drop-off in sales of Spider-Man and Transformers toys in a non-movie year.  The new Transformers Animated series, which is set to debut in Q1 2008 (see 'Transformers Animated Series Delayed'), should provide plenty of opportunities for new lines of Transformers toys and soften the decline in sales in what has become Hasbro's #1 toy line.