Jakks Pacific slashes outlook, to cut jobs
(Reuters) - Toy company Jakks Pacific Inc (JAKK.O) slashed its full-year forecast and said it would substantially reduce jobs and leased space, due to declining retail orders and children's increasing preference for electronic devices.
The company's shares fell 28 percent in after-hours trade, after closing at $11.48 on the Nasdaq.
The company, which sells toys under such licenses as Cabbage Patch Kids and Hello Kitty, posted a surprise second-quarter loss of $2.14 per share, while sales fell 27 percent to $106.2 million.
Chief Executive Stephen Berman said part of the problem was the continuing change in play patterns of children, who now rely more on smart devices for their entertainment.
The company now expects to post a loss of about $56.1 million, or $2.56 per share, for the full year. It had earlier forecast earnings of 63-68 cents per share. It now expects full-year sales of $620.0 million, down from the $694 million to 700 million it had projected earlier.
The company also suspended its quarterly dividend.
(This story is corrected in paragraph 2 to add dropped word "fell")
(Reporting by Arpita Mukherjee in Bangalore; Editing by Anthony Kurian)