Toy maker Hasbro is “evaluating” whether to offload its 40 percent stake in Discovery Family Channel.
The branded Discovery TV channel is 60 percent owned by Discovery, with Hasbro having held 40 percent since 2014. On Monday, as Hasbro released its fourth quarter earnings, the toy maker recorded a $41.3 million net non-cash, non-operating charge associated with the company’s investment in the Discovery Family Channel.
That accounting charge follows longstanding speculation Hasbro was set to pull out of Discovery Family Channel, especially as Discovery is set to merge with WarnerMedia, AT&T’s entertainment arm.
Hasbro CFO Deborah Thomas, as she discussed the future of the Discovery Family Channel stake during an analyst call, pointed to the impact of accelerating changes in the cable distribution industry, including a decline in linear TV subscribers. As more TV viewers migrate to streaming platforms and other digital alternatives, Thomas pointed to a possible sale or another strategic alternative for the Discovery Family Channel stake.
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“It was a great investment for us. We made it over ten years ago. It allowed us to get our programming on the air and it really drove the beginning of the brand blueprint strategy… It’s been a terrific investment for us. It’s driven over a $1 billion in revenue for the company. There’s just changes happening in the cable industry. As we look around us, there’s more people moving to streaming. That being said, Discovery runs a great network. It’s been a great investment for Hasbro as we continue evaluating what we’re going to do with it. We’ll continue looking at what’s happening, but it’s been a fantastic investment for us over time,” Thomas told analysts.
Discovery Family Channel as a joint venture of Discovery and Hasbro is managed under the Discovery portfolio of networks and has relied on a steady stream of Hasbro Studios kids TV shows like My Little Pony and Transformers.
