Toronto-based Spin Master Corp. saw a significant year-over-year increase in its fiscal Q1 revenue while its entertainment segment remains under pressure.

In Q1 2025 for the three months ending March 31, the company posted US$37.8 million in revenue for its entertainment segment, compared to US$43.8 million in the same period last year. This was primarily attributed to lower distribution revenue in the company’s earnings report.

The segment’s operating income also declined by US$2.7 million to US$25.9 million from US$28.6 million, for the same reason, but was partially offset by lower amortization due to fewer content deliveries and lower marketing expenses.

Ultimately, the company’s total Q1 revenue stood at US$359.3 million, a 13.6% increase from the same period last year. This is thanks to significant increases in toy revenues and gross toy product sales.

Adjusted EBITDA for the quarter increased by US$3 million to US$23.6 million from Q1 2024.

The segment decline continues from the company’s Q4 and full-year 2024 results, which saw a quarterly decrease of $13.9 million, or 25.2%, to $41.3 million, due to fewer content deliveries. The segment decline for the year stood at 16.6%.

“Entertainment revenue will grow in 2026 as we deliver the third [PAW Patrol (pictured)] movie and other new content on a consolidated basis,” said outgoing CFO Mark Segal during the previous earnings call.

Due to uncertainty surrounding U.S. tariffs, the company is withdrawing its 2025 outlook “until the environment stabilizes,” said Segal in a statement. The outlook was previously submitted in February, in which it expected revenue to increase 4% to 6% compared to 2024.

Segal noted during the Q1 2025 earnings call that 85% of the company’s revenue comes from its toy segment – half in the U.S. and half outside of it – and the rest from its entertainment and digital games segments.

“This means that approximately 57.5% of Spin Master’s total revenue is not subject to tariffs, and in the case of entertainment and digital games, does not have a physical supply chain at all,” said Segal during the call. “This geographic and segment diversification continues to provide revenue and margin protection against global trade pressures on the U.S. toy market.”

Image courtesy of Elevation Pictures