LEGO revenue drops 5% in first half of 2018

The Danish brickmaker’s revenue fell to US$2.21 billion for the first six months of fiscal 2018, with declines attributed to the weakening US dollar.
September 4, 2018

The LEGO Group has reported a 5% decline in revenue for the first half of fiscal 2018, to the tune of US$2.21 billion. Similarly, operating profit was down 4% to US$651 million, and net profit dropped 10% to US$465 million.

According to the Danish brickmaker, this revenue slip was driven primarily by a weaker US dollar. In a press release, CEO Niels Christiansen said the company would focus on stabilizing its business and investing in long-term growth in the second half of 2018.

Global consumer sales stayed relatively steady, growing 1% in the first six months of fiscal 2018. Top performing themes for this period included LEGO Technic, LEGO Ninjago, LEGO Creator and LEGO Classic (pictured). 2018 marks the 60th anniversary of the LEGO brick, as well as the 40th anniversary of LEGO’s minifigures.

Revenue in North America was slightly down, but China saw double-digital growth in the first half of 2018. To capitalize on the upward momentum in this region, LEGO will be opening two Chinese flagship stores, one in Shanghai this month and another in Beijing in early 2019. Earlier this year, the company partnered with Chinese internet giant Tencent to create a number of interactive kids experiences in the region.

LEGO’s revenue dip follows a difficult fiscal 2017, in which the company reported annual sales and profit declines for the first time since 2004 (global revenue fell 8% to US$5.82 billion). According to the toyco, last year’s disappointing results were driven in part by the clean-up of inventories in the company’s value chain. It also reported that global consumer sales were flat throughout the year, but trended upward in the final months of 2017.

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