Lego Financial Results January-June 2018

[Khscarymovie4]

Hello all. Lego has announced their financial results for the first half of 2018. 

https://www.lego.com/en-gb/aboutus/news-room/2018/september/interim-results-2018/

Overall it is better then 2017. Growth in China (bad for Lepin hahaha), and Western Europe occurred while the North American market reduced slightly due to retail environment. The closure of Toys R Us might be to blame but I am not sure. Themes like City, Classic, Ninjago, Star Wars, Technic, and Jurassic World are mentioned as the big sellers. No Superheros again which surprises me  again. Set such as the Creator Roller Coaster and the Technic Bugatti Chiron are mentioned as selling well. Good news overall I think. Surprised JW is a big seller, might be the success of the movie though. Also good to note that Wizarding World is not included in these results as the sets were released in August. What are your thoughts?

Edited September 5, 2018 by Khscarymovie4

[Aanchir]

Happy to see that Ninjago is still a strong seller. Surprised not to see Friends mentioned, since it's typically been a strong seller in past years. In general, with the shake-up that the death of Toys 'R' Us brings to the entire industry it's nice to know that for now, at least, things are remaining fairly stable. It'll be interesting to see how things hold up during the holiday shopping season since that's such a big part of any toy company's overall annual revenue.

[MAB]

1 hour ago, Khscarymovie4 said:

Themes like City, Classic, Ninjago, Star Wars, Technic, and Jurassic World are mentioned as the big sellers. No Superheros again which surprises me  again. Set shuch as the Creator Roller Coaster and the Technic Bugatti Chiron are mentioned as selling well. Good news overall I think. Surprised JW is a big seller, might be the success of the movie though.

2

It doesn't say that JW or the Bugatti are selling well. It says that they launched well. What that means is anyone's guess.

The lack of SH doesn't surprise me at all. While they may sell well in the US, in Europe they typically sell quite badly.

[Khscarymovie4]

1 hour ago, MAB said:

The lack of SH doesn't surprise me at all. While they may sell well in the US, in Europe they typically sell quite badly.

I got a very similar response on brick set. I am surprised that SH don't sell as well outside the US. Superhero movies are dominating the box office all across the world. Hopefully they still sell well enough so the theme is not cancelled any time soon, it's my favorite at the moment.

As for the launching well, I would say that means the sets have not been out long enough to say they sold well but at the moment are selling fine. Werid wording. 

[MAB]

37 minutes ago, Khscarymovie4 said:

I got a very similar response on brick set. I am surprised that SH don't sell as well outside the US. Superhero movies are dominating the box office all across the world. Hopefully they still sell well enough so the theme is not cancelled any time soon, it's my favorite at the moment.

As for the launching well, I would say that means the sets have not been out long enough to say they sold well but at the moment are selling fine. Werid wording. 

It could also be advertising mean not selling well, but if they mention it is successful then people may panic into buying now.

 

As to SH sets, I think there are just too many now. Plus the prices have gone crazy in Europe (although that is true for many / all licensed themes). For UK prices, it is almost certain that regular retail sets will be discounted by 30%, so I never believe the RRPs. I think they are set these days so that sets can be discounted. 

[Aanchir]

Another thing to keep in mind about Super Heroes is that instead of treating it like one big theme like LEGO Star Wars, LEGO often treats it more like two separate, smaller themes since it includes both the DC and Marvel licenses. There are only like 12 (non-promo, non-polybag) Marvel sets this year and 10 (non-promo, non-polybag) DC sets this year. It's not too surprising that either of those themes individually doesn't sell as well as themes that get 20 or more new sets per year like City, Star Wars, and Ninjago.

[BrickJagger]

I don't find it surprising that SH isn't selling like it used to. Superhero movies come off as a fad to me and after Avengers 4 I think interest will drop off considerably. I do find it interesting that the Infinity War sets didn't provide any noteworthy boost to Marvel's sales.

Overall it was a "meh" year financially for Lego. 1% growth is nothing to be proud of, but it's better than last year. Personally I bought only a couple of 2018 sets, so I hope that next year has more stuff that I like because I'd love to contribute to their sales growth 

[allanp]

Very happy to see Technic selling well. I really do wish the big YouTube channels would cover them more to give Technic some much deserved exposure.

With regards to sets based on movies and super heroes, the popularity of a movie doesn't seem to be very strongly correlated to the popularity of a set based on it. The last jedi was very poor as well as Jurassic world 2, but Lego can make good sets from them and they sell ok. The superhero films are doing very well and infinity war is a much better movie than last jedi or JW2. But if all a set can offer is two minifigs fighting (and let's give Superman a car because.....God only knows why he needs a car!) then I don't think it's gonna have much appeal.

[Robert8]

Good to see Ninjago is still doing well after that no so good movie

 

[Aanchir]

3 hours ago, allanp said:

Very happy to see Technic selling well. I really do wish the big YouTube channels would cover them more to give Technic some much deserved exposure.

With regards to sets based on movies and super heroes, the popularity of a movie doesn't seem to be very strongly correlated to the popularity of a set based on it. The last jedi was very poor as well as Jurassic world 2…

Now hang on a sec. Obviously I know quality is subjective, but there’s no disputing that The Last Jedi has been massively successful, both in theaters and on DVD/Blu-Ray. If anything, my understanding is that toy sales for The Last Jedi floundered more than the movie itself due to market oversaturation.

[MAB]

20 minutes ago, Aanchir said:

Now hang on a sec. Obviously I know quality is subjective, but there’s no disputing that The Last Jedi has been massively successful, both in theaters and on DVD/Blu-Ray. If anything, my understanding is that toy sales for The Last Jedi floundered more than the movie itself due to market oversaturation.

Yeah, highest grossing film of 2017, and pretty excellent critics reviews and decent audience responses but less good online reviews which were apparently attacked by the anti-Disney brigades.

The movie was well received and the sets not so well (compared to past SW sets). But as you say, the SW merchandising machine has completely oversaturated the toy market.

[Mylenium]

On 9/5/2018 at 6:20 PM, Khscarymovie4 said:

I am surprised that SH don't sell as well outside the US. Superhero movies are dominating the box office all across the world.

B.O. dominace or critical acclaim doesn't mean anything. Many movies that were successful in the US totally bomb here in Europe and vice versa, though by that I don't specifically mean superhero movies. My favorite example still is "Sideways" - got an Oscar, but nobody here in Germany actually saw it (it made a mere 20000 Euros or so and got pulled after only one week in Cinemas) and is now running as filler late at night on some channels. Different tastes and different markets.

As far as the superhero movies are concerned we simply don't have the comic tradtion to go with them plus the movies are simply not satisfying certain intellectual needs. Even the best of them are actually pretty mediocre and easy to see through. That's okay for a little brainless fun for two hours, but those movies are forgotten as quickly as Disney and DC are churning them out. That in itself is of course a problem, too. There's just too many movies of that ilk and it's really beginning to just become a show of overused clicheés and worn out standard tropes.

All that is to say that there are easily explicable reasons why US-based superhero movies don't have the pull to generate more merchandising opportunities even if the films themselves are reasonably commercially successful here. People just don't care about them that much. And of course one could pull out the old argument of outrageous pricing for many of these licensed sets just like with Star Wars...

Mylenium

On 9/5/2018 at 6:20 PM, Khscarymovie4 said:

As for the launching well, I would say that means the sets have not been out long enough to say they sold well but at the moment are selling fine. Werid wording. 

It usually means that after the initial buzz sales will drop considerably and the vendor/ manufacturer is fully aware of it. You need to buy a "corporate BS talk" dictionary. :D

Mylenium

2 hours ago, Aanchir said:

If anything, my understanding is that toy sales for The Last Jedi floundered more than the movie itself due to market oversaturation.

I think so, too, and in case of LEGO they just once more got the wrong end of the stick. That AT-ST debacle clearly hasn't helped...

Mylenium

Edited September 7, 2018 by Mylenium

[Aanchir]

1 hour ago, Mylenium said:

B.O. dominace or critical acclaim doesn't mean anything. Many movies that were successful in the US totally bomb here in Europe and vice versa, though by that I don't specifically mean superhero movies. My favorite example still is "Sideways" - got an Oscar, but nobody here in Germany actually saw it (it made a mere 20000 Euros or so and got pulled after only one week in Cinemas) and is now running as filler late at night on some channels. Different tastes and different markets.

Not really the best example because even here in the states I think you’d find loads of people who have never heard of that movie. Frankly the Oscars are a lot different even from even typical critics because they tend to be a hoity-toity affair and the judges are notoriously biased against anything they consider “lowbrow” — which includes animated films, the entire horror genre, superhero movies, and anything they perceive as commercialized. Note that this overlaps with a lot of the types of licenses LEGO seeks out and the types of movies kids tend to like (Disney and Pixar movies do often win Oscars, but that’s mostly because a lot of the judges don’t even care enough about animated movies to watch them and just vote for Disney flicks based on the studio’s prestigious reputation).

And even if a lot of the popularity of superhero movies is centered in the US, not only is that a massive market in and of itself, but American pop culture has a wide enough reach that these themes certainly don’t ONLY make money in North America.

[dr_spock]

On 9/5/2018 at 10:44 AM, Aanchir said:

Happy to see that Ninjago is still a strong seller. Surprised not to see Friends mentioned, since it's typically been a strong seller in past years. In general, with the shake-up that the death of Toys 'R' Us brings to the entire industry it's nice to know that for now, at least, things are remaining fairly stable. It'll be interesting to see how things hold up during the holiday shopping season since that's such a big part of any toy company's overall annual revenue.

This year LEGO released the newly re-imaged Friends mini-dolls.  The new ones are not quite the same as the old ones. 

 

[Mylenium]

15 hours ago, Aanchir said:

Not really the best example because even here in the states I think you’d find loads of people who have never heard of that movie.

Yes, of course, but that analogy could be applied to a ton of other movies, including ones that you might consider a blockbuster and that made half a billion stateside. Same for TV series and what have you. And that also ties into your argument about US cultural influence: No, it's not as big as you may think and it's sure to dwindle even further, given current political developments. The days when people got excited about Coca Cola are long gone and people are very particular about what they consume or what cultural trends they follow. Explaining it in more detail would be too longwinded, but suffice it to say that for instance a popular watchlist on German Netflix would be quite different from its US brother. And by extension that affects LEGO as well. Some stuff you may take for granted is simply barely known or even totally irrelevant around these parts and thus don't make for a good basis of selling tie-in sets and merchandise, hence LEGO Super Heroes and some other things don't even make a dent in the sales statistics.

Mylenium

Edited September 8, 2018 by Mylenium

[Aanchir]

21 hours ago, dr_spock said:

This year LEGO released the newly re-imaged Friends mini-dolls.  The new ones are not quite the same as the old ones.

The current Ninjago figs are "not quite the same as the old ones" either. Let's assign points for the changes that can't be chalked up to facial expression (because every character's facial expression changed at least slightly across both themes)

• Kai's hairstyle and insignia changed, his left eye scar was replaced with a right eye scar, his eyebrow color changed, and he now has a bandage on his forehead. (5 points)
• Jay's hairstyle, hair color, and insignia changed, he gained freckles, his eyebrow color changed, and he lost the little scar in his left eyebrow. (6 points)
• Zane's hairstyle, hair color, and insignia changed, and his eyebrows and mouth both became more robotic in shape (5 points)
• Nya's hairstyle and insignia changed, she gained a beauty mark, lost her dimples, and now has one eyelash per eye instead of three. (5 points)
• Lloyd's hairstyle, insignia, eye color, and eyebrow color changed, and his eyebrows became a thicker and more angular shape. (5 points)
• Cole's hairstyle and insignia changed, he lost his ghostly forehead scar and his eyebrows changed shape, but only subtly. (4 points)

30 points/changes total, 5 per character on average.

Whereas with LEGO Friends mini-dolls:

• Olivia's hairstyle, insignia, and lip color changed, she got glasses, and her skin tone became one shade darker* (5 points)
• Emma's insignia and eye color changed and her eyes became more almond-shaped (3 points)
• Nothing changed about Stephanie except her expression (0 points)
• Mia's insignia, eye color, and lip color changed. (3 points)
• Andrea's hairstyle, eye color, and lip color changed (3 points)

14 points/changes total, 2.8 on average per character

Some people have articulated that they feel less mutable facial features like skin color, hair color, eye color, eye shape, eyebrow color, eyebrow shape, scars, and freckles/blemishes might count more than things like hairstyle, lipstick color, glasses/bandages, and insignias which can be thought of as just a costume update like the ones the characters in both themes have already been through plenty of times. In that case, Ninjago had 15 points/changes, or 2.5 per character and Friends had… err… just five points/changes, or just one per character. So yeah… whichever way you slice it, the Ninjago characters went through more design changes.

A bit of clarification on the change to Olivia's skin color, which seems to be the change most people get hung up on. Olivia's old skin color was the same as System Poe Dameron, System Buzz Lightyear, System Woody, or System Jessie. Her new skin color was the same as buildable figure Poe Dameron, Duplo Buzz Lightyear, Duplo Woody, or Duplo Jessie.

GASP. Look at how vastly different the races/ethnicities of the characters on that first list are from the characters on that second list… Just kidding! They're the same exact characters. So it's a mystery why people noticing a change in a character's skin color gets them so hot and bothered… Oops! Kidding again! The reasons are obvious.

In any case, if the redesigns for the Ninjago characters outweigh the ones for the Friends characters, yet Ninjago got back on the interim result's top sellers list while Friends fell off it, I don't think this apparent dip in the Friends theme's popularity can be attributed to the characters looking "not quite the same".

[Mylenium]

3 hours ago, Aanchir said:

I don't think this apparent dip in the Friends theme's popularity can be attributed to the characters looking "not quite the same".

There is no dip. Friends was/ is just not as popular as you always seem to assume. It always comes back to that, regardless in how many threads we seem to be discussing this endlessly. And making this about ethnic/ racial issues is just pointless. Most people would happily just burn their minidolls on a pyre regardless of how they look. They're just extremely unpopular.

Mylenium

[Aanchir]

7 hours ago, Mylenium said:

There is no dip. Friends was/ is just not as popular as you always seem to assume. It always comes back to that, regardless in how many threads we seem to be discussing this endlessly. And making this about ethnic/ racial issues is just pointless. Most people would happily just burn their minidolls on a pyre regardless of how they look. They're just extremely unpopular.

Mylenium

It was literally one of the top-selling themes globally from 2014 to 2016, the period when the company reached the most kids and achieved their highest revenues in company history. Heck, even in 2012 when it had just launched, Olivia’s House was the top-selling set from ANY theme. The Friends theme’s success is extremely well-documented. But sure, keep on pretending your opinions and anecdotal experiences are gospel truth. It’s not my problem if you choose to make a fool of yourself.

And c’mon, it’s more than proven by now that the mini-doll has been a huge hit with girls who could never manage to relate to the minifigure the same way, and has been a major factor in the Friends theme’s groundbreaking success getting more girls into LEGO — are you seriously so out-of-touch that you can’t recognize that?

Edited September 9, 2018 by Aanchir

[Mylenium]

You must be reading other numbers and opinions than I do. Of course I'm more than willing to admit that not being part of the core target demographic I have a different view, anyway. I don't know anyone who actually likes the minidolls and even the little girls from the neighborhood much prefer their Playmobil fairies and horse rider girls. Even the sales numbers seem wrong. At least there's no way to reliably coroborate your claims to the popularity of individual sets or product series beyond "Yes, Friends is making LEGO some money.". Well, whatever. I'm not going to debate the issue further and let's just leave it at that.

Mylenium

[Soupperson1]

On 9/9/2018 at 4:50 PM, Mylenium said:

You must be reading other numbers and opinions than I do. Of course I'm more than willing to admit that not being part of the core target demographic I have a different view, anyway. I don't know anyone who actually likes the minidolls and even the little girls from the neighborhood much prefer their Playmobil fairies and horse rider girls. Even the sales numbers seem wrong. At least there's no way to reliably coroborate your claims to the popularity of individual sets or product series beyond "Yes, Friends is making LEGO some money.". Well, whatever. I'm not going to debate the issue further and let's just leave it at that.

Mylenium

You don’t need to discuss it anymore but please check the annual reports from 2012 onwards, Friends has been in the top selling themes up to now.

For others who are willing to discuss this further, it’s not just the characters that changed. The buildings are less curved and there is a stronger focus on consistent colours in each sets matching a girl’s main colours. Also I think the total lack of media (there’s only one English webisode online so far and it’s September, no books) didn’t help. 

On 9/9/2018 at 3:47 AM, Aanchir said:

 

Whereas with LEGO Friends mini-dolls:

• Nothing changed about Stephanie except her expression (0 points)

Stephanie’s eyes are now a darker shade of blue, a small change yes but kids notice these things,

[Mylenium]

7 hours ago, Soupperson1 said:

You don’t need to discuss it anymore but please check the annual reports from 2012 onwards, Friends has been in the top selling themes up to now.

I did and frankly I think you are simply trying to see something that isn't in there. Nowhere do they ever state concrete sales figures for individual series or sets even, only the typical generic press release hogwash and some percentages that quickly look a lot less impressive when you do the actual math. That aside I never said that Friends would be unimportant in the overall scheme, I just can't see how for a series that only accounts for a fraction of LEGOs overall revenue and whose importance has been dwindling not just these last two years, you can see a "dip" or even go so far as to attribute LEGO's current financial not-so-wellbeing to Friends being in crisis. I maintain: It was probably never as important to begin with and the rest is just LEGO's own fault. Well, whatever, I'm sure we could discuss this for the next few months, but this is the last I'm saying about the subject. I'll retreat from this thread for good. See you another time...

Mylenium

[Aanchir]

3 hours ago, Mylenium said:

I did and frankly I think you are simply trying to see something that isn't in there. Nowhere do they ever state concrete sales figures for individual series or sets even, only the typical generic press release hogwash and some percentages that quickly look a lot less impressive when you do the actual math. That aside I never said that Friends would be unimportant in the overall scheme, I just can't see how for a series that only accounts for a fraction of LEGOs overall revenue and whose importance has been dwindling not just these last two years, you can see a "dip" or even go so far as to attribute LEGO's current financial not-so-wellbeing to Friends being in crisis.

When you get right down to it, ALL themes "only account for a fraction of LEGO's overall revenue" — it's just that some of those fractions are bigger than others. There's no doubt that LEGO Friends has made up a bigger fraction of LEGO sales in recent years than the many themes that haven't been listed among the top sellers in any of the past several years, like Disney, Nexo Knights, DC Super Heroes, Marvel Super Heroes, Elves, Juniors, etc.

And while LEGO may not speak at length about exactly how successful individual themes are for them, bear in mind the old saying "actions speak louder than words". Typically, ongoing themes that have been more popular/successful tend to get higher numbers of sets while themes that have been less popular/successful tend to get lower numbers of sets. This year's biggest themes in terms of number of sets are Star Wars, City, Friends, Ninjago, BrickHeadz, and Duplo. That should give you a pretty good sense of which themes LEGO expects customers to buy a lot of based on previous sales trends.

You're right that no matter HOW well or poorly LEGO does in any given year, it can rarely be attributed to any one theme over- or underperforming. But I don't really see anyone trying to claim decisions made in the Friends theme are the overall reason for how LEGO is doing right now, just speculating about why it's not among the four best sellers in this year's interim results like it was in last year's.

And for all we know it might not even be a case of Friends performing any worse than usual — it may just be that Creator and Classic, which weren't on the best seller list in last year's interim results, are performing better than usual, particularly with several LEGO Classic products and marketing campaigns that launched this year to tie in with the LEGO Brick's 60th anniversary.

Truth be told Classic is not the sort of theme that I normally think of as having best seller potential. While basic brick sets will surely always be in demand and are many parents' ideal of what a LEGO set should be, they don't have as much of an incentive for year-after-year collecting as play themes often do, because they tend to offer a pretty similar inventory of parts — so once you have a few basic brick buckets, buying more will increase the quantity of bricks you have, but not so much the variety.

That said, I'm also sure the Classic theme tends to sell way better than its smallish number of new sets per year would suggest, for more or less the same reason. If the idea of a basic brick set is to offer wider creative options than you'd get from a more specific kit of the same size, then it doesn't take nearly as many different sets to reach builders with wide-ranging interests (whereas in, say, City you would need different models for the kids who like cars, trucks, motorcycles, planes, boats, helicopters, buses, trains, police stations, fire stations, construction vehicles, etc).

Edited September 12, 2018 by Aanchir