The LEGO Group delivers double-digit growth during 1H 2020
Posted by CapnRex101,
The LEGO Group has published its financial results for the first half of 2020, confirming that LEGO has achieved considerable growth during this period.
Strong consumer demand drove consumer sales, revenue, operating profit and market share growth. Strategic investments positioned the Group well to navigate impact of COVID-19.
- Consumer sales grew 14 percent in 1H 2020 compared with 1H 2019.
- Revenue grew 7 percent to DKK 15.7 billion compared with the same period in 2019.
- Operating profit grew 11 percent to DKK 3.9 billion, while investing in significant long-term growth initiatives.
- Free cash flow strong at DKK 4.1 billion.
- Market share grew in major countries, outpacing the toy industry.
BILLUND, September 2, 2020: The LEGO Group today reported first half earnings for the six months ending June 30, 2020. Revenue for the period grew 7 percent to DKK 15.7 billion compared with the same period in 2019. Consumer sales grew 14 percent compared with 1H 2019 and the brand’s global market share increased. Operating profit was DKK 3.9 billion, an increase of 11 percent compared with 2019.
The LEGO Group CEO, Niels B. Christiansen said: “The strong results are due to our incredible team. When COVID-19 closed stores and offices, our colleagues did everything they could to stay safe and bring play to children and families around the world. I would like to thank them for their extraordinary contribution and their continued fantastic efforts.”
“During the first half, we saw the benefits of our investments in long-term growth initiatives such as e-commerce and product innovation. Our strong portfolio appealed to builders of all ages and our recently upgraded e-commerce platform and agile global supply chain allowed us to fulfil online demand. We also collaborated closely with our retail partners to ensure they could continue to supply their shoppers online.”
The Group delivered double digit consumer sales growth in its major market groups including the Americas, Western Europe, Asia Pacific and China. Operating profit growth was driven by strong sales, offset by bold investments in long-term growth initiatives and higher freight costs associated with shipping products following temporary, government-mandated factory closures in Mexico and China. Underlying net profit grew 13 percent. Adjusted for the impact of foreign exchange on inter- company loans, which has no cash impact, net profit declined 1 percent to DKK 2.6 billion. Free cash flow was strong at DKK 4.1 billion.
A strong portfolio for builders of all ages
Across the portfolio, the top-performing themes in no particular order were LEGO Technic, LEGO Star Wars, LEGO Classic, LEGO Disney Princess, LEGO Harry Potter and LEGO Speed Champions, proving the appeal of LEGO play to fans of all ages and interests.
The LEGO Group also launched ‘Let’s Build Together’ a digital initiative designed to bring learning through play to children whose education was disrupted due to the pandemic. Around 90 percent of school aged children were outside of their usual learning environments during the first half of the year. ‘Let’s Build Together’ saw thousands of hours of online content and play ideas reach more than 80 million unique users around the world.
Christiansen: “We are very pleased to see the enduring appeal of the LEGO System in Play and strength of the LEGO brand. During the first half we attracted new builders of all ages who turned to LEGO play to help them through difficult times. More families are playing and learning together with LEGO bricks and we are seeing more adults than ever before enjoying building our more challenging sets.”
Strategic investments in long-term growth
During the first half of 2020, the LEGO Group continued to invest in long-term growth initiatives designed to achieve its ambition to reach more children around the world.
Christiansen said: “Many of the major trends shaping our industry, such as digitalisation and e-commerce, are accelerating as a result of the pandemic. We saw strong growth in digital and traditional play, a rapid shift to e-commerce and the importance of having a truly global operating model.”
During the first half of 2020, the Group unveiled LEGO Super Mario, an entirely new play experience which blends digital and physical play. It also launched LEGO Monkie Kid, the first theme designed around Chinese folklore.
There was a significant increase in engagement in the company’s digital play experiences. In the first six months, downloads of LEGO digital building instructions doubled to two million and every two seconds a piece of content was shared on LEGO Life, a safe digital play app, which has more than 9 million users in 80 countries.
Visitors to the LEGO.com e-commerce platform doubled to more than 100 million in the first half of 2020, compared with the same period a year ago. The company also plans to continue creating unique physical brand experiences for shoppers and is on track to open around 120 new retail stores in 2020, 80 of those in China. During the first half, it opened 46 retail stores, 30 of those in China.
Christiansen said: “While retail has been transformed during the past six months, we continue to see great opportunity for an omnichannel model. We will continue to invest in upgrading our e-commerce capabilities to support both our retail partners and own platform and continue to invest in creating fantastic physical brand experiences for shoppers and fans.”
Helping children learn through play
During the first six months of 2020, the LEGO Group supported those hit hardest by the pandemic. In partnership with the LEGO Foundation, it donated USD 50 million to a range of organisations that provide emergency relief to families and support for children in learning through play. It also donated more than 250,000 LEGO sets to children in need of play.
The Group re-purposed moulding machines in its factories in Denmark, Czech Republic, Hungary and Mexico to manufacture more than half a million visors for frontline health professionals who required personal protective equipment (PPE).
Christiansen said: “The first six months of 2020 have been unprecedented. I am incredibly proud of the team and how they responded. We kept each other safe, we took care of those most in need and we did everything we could to inspire children and families, whose lives were put on hold, to learn through play.”
What is your opinion of these results? Let us know in the comments.
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66 comments on this article
Funny, I spent less but build more (as I still have a lot to catch up)
Nice to read they also do a lot of charity.
A noteworthy lack of LEGO City and LEGO Friends in the top-performing themes. Classic remains, well, a classic, though I do have a problem with its PPP ratios in recent years.
Very proud of LEGO for having adapted to such a world-changing, business-changing and life-changing event, and coming out strong!
Speed Champions?
Great news. I'm both surprised and not surprised. Surprised because the theme only offers cars which I don't consider appeal to the majority.
Not surprised because of the quality the theme offers in terms of design and range of models
I'm worried about Ninjago though.
Learning about the financial aspect of the Lego company is very interesting, and it's great that Lego has done so well and helped others during the pandemic. I admire Lego as the company has a positive ethos and produces great products. It is interesting that the licenced sets are doing so well this time round. Thanks for the information.
Happy to see Harry Potter on the list, was about time and very impressive with so few sets a year compared to many other themes ;)
It is about time my name is listed in the financial reports. I am about to invite employees from the local branch store for my birthday if it weren’t for corona...
So, will there be fewer excuses that printing is sooooo prohibitively expensive so we must use stickers.
Now they can afford to employ a few more staff to fulfill the bricks and pieces orders..
I definitely bought more exclusive LEGO sets during the COVID-19 period. With no local LEGO store and the fact that I am never in to receive deliveries, my LEGO purchasing can be somewhat limited at times. However, working from home has changed that, and I got quite addicted to LEGO.com purchasing and waiting for the postman: Batmobile, Fiat, Crocodile Loco, A-wing, AT-AT, many birthday presents.
Congratulations to Lego.
As for me, I've spent far less this year than in the past five years on the back of unappealing themes and poor value sets.
If it weren't for Diagon Alley I'd be well under half 2019 if I bought all my wanted sets by the end of the year.
I have retail toy stores. Not surprised about Speed Champions - 75892 McLaren Senna is hands down the single biggest selling Lego set I have ever had (76898 Jag also sells very well). Friends and Ninjago are our biggest selling range, whereas historically it has always been City and SW which, for me anyway, have had drastic slumps this last 12 months
Interesting. This will be more interesting in the coming year as the global recession takes hold, particularly as set costs rise.
I would like to point out that overall costs at least for themes Im interested in have, arguably, increased, however quality has decreased.
I do not refer to sets becoming significantly more 'juniorised' (i.e City) (although that is a concern) but to the obvious lack of consistency between the colours and clutch power of parts.
The colour inconsistency was pointed out by Jangbricks, only recently have I experienced this problem in my own sets. It is very noticeable and concerning as lego rip offs like Lepin rise in popularity.
Again we see Lego pushing into China, which is a shame since I believe the CCP also attacked Denmark in its global subversion campaign as well as other EU members, India and of course my own country Australia.
I would not be surprised if the CCP put sanctions on Denmark if Lego released the Ideas Winnie the Pooh set in China....
@LegoSonicBoy said:
"A noteworthy lack of LEGO City and LEGO Friends in the top-performing themes. Classic remains, well, a classic, though I do have a problem with its PPP ratios in recent years."
By definition, not everything can be a top performing theme. It doesn't really matter if something isn't performing as well, so long as it is profitable and serving a market.
But I would say it is noteworthy that City and Friends is what you've picked up on. Creator / Creator Expert is also missing from the list, which is interesting when it's an important product line for AFOLs.
Apparently the excessive price increases haven't hurt sales... for now.
@Brickchap said:
"...Again we see Lego pushing into China, which is a shame since I believe the CCP also attacked Denmark in its global subversion campaign as well as other EU members, India and of course my own country Australia.
I would not be surprised if the CCP put sanctions on Denmark if Lego released the Ideas Winnie the Pooh set in China...."
This is my biggest fear. With bigger chinese influence (because of the big market) I am afraid that Lego will make some “changes” in future sets. We saw this before (Disney, Blizzard Activision etcetc) so it wouldn’t be surprise but I don’t want that.
It's good that they recouped aome of thw downfall they had, I wonder how many new costumers will continue with the company after this.
Phew! This will secure Harry Potter a longer run
Always wondered, since this is a private company, who is the target of these reports? I doubt there is any danger of the company obtaining any additional loans so this really isn't for the banks. And they're not a non-profit, so they don't have to answer to some regulatory body.
@Miamibear said:
"Apparently the excessive price increases haven't hurt sales... for now."
Excessive price increases where? Star Wars is the only theme that’s had a bad PPP more often than not but the popularity gets it through. Virtually every other theme has had prices ranging from fair to great. Just because a price is big doesn’t mean it’s bad.
@meesajarjar72 said:
"Now they can afford to employ a few more staff to fulfill the bricks and pieces orders.."
That. One of my orders was shipped yesterday. I had purchased it on August 2nd.
I spent more on BrickLink, eBay, and my local second-hand shop because I found most of the official sets lacking during the second and third quarters. The only exception is Harry Potter. Breaking up Hogwarts was brilliant. I hope TLG adds Gringott’s and a few other buildings to Diagon Alley and elsewhere in magical London.
Top themes are only licenced ones...
Lego is dying... With a bang. But still.
I find year 2020 one of the weakest Lego years.
Oversized sets, prints problem, no many really good sets, a downgrades in city builds and pushing Lego for Adult only...
Of course Lego has done really well, the last six months. Everyone was stuck at home with nothing else to do.
I've spent a lot on Lego, this year, but it hasn't been new sets. Mostly I've been browsing eBay and Bricklink and buying older sets. I guess that's my thoughts on this year's range, but I don't think 2020 has been a great year. Almost everything (aside from Ninjago) has been really lacking.
@fakespacesquid said:
" @Miamibear said:
"Apparently the excessive price increases haven't hurt sales... for now."
Excessive price increases where? Star Wars is the only theme that’s had a bad PPP more often than not but the popularity gets it through. Virtually every other theme has had prices ranging from fair to great. Just because a price is big doesn’t mean it’s bad."
City also suffers from this, as do Marvel and Jurassic sometimes
@vzarmo said:
" @Brickchap said:
"...Again we see Lego pushing into China, which is a shame since I believe the CCP also attacked Denmark in its global subversion campaign as well as other EU members, India and of course my own country Australia.
I would not be surprised if the CCP put sanctions on Denmark if Lego released the Ideas Winnie the Pooh set in China...."
This is my biggest fear. With bigger chinese influence (because of the big market) I am afraid that Lego will make some “changes” in future sets. We saw this before (Disney, Blizzard Activision etcetc) so it wouldn’t be surprise but I don’t want that.
"
Like not selling an Osprey because of German influence? Lego doesn't do anything generally that is considered political, religious or whatever.
So, all the top selling themes are licensed ones? Ouch.... Not a good sign.
@lordofdragonss said:
"Top themes are only licenced ones...
Lego is dying... "
TLG posts regular growth most years. You must have a strange definition of what a dying brand is.
@Brickmasterboy said:
"Speed Champions?
Great news. I'm both surprised and not surprised. Surprised because the theme only offers cars which I don't consider appeal to the majority.
Not surprised because of the quality the theme offers in terms of design and range of models ."
I would think cars appeal to a large chunk of their male audience. Also 2020 marks an overhaul to speed champions where they changed from 6 studs wide to 8 studs wide which allows a lot more detail in the shapes they can create. For me this years speed champions were the first ones I've purchased because I felt the aesthetic improved significantly. The details on the Ferrari F8 are amazing for a model with ~220 pieces
Lego is dying because most parts are qualitatively worse than other brands and even bootlegs now. A trend started in 2017, the year that Lego got into trouble because they once didn't have the growth they wanted.
If it weren't for Harry Potter having so many decent builds (unlike every other theme since 2013) and interesting minifig parts (even in spite of the milky plastics), I don't think I would buy more than one or two D2C sets per year and a couple hundred bucks of B&P stuff.
At this point they are only getting carried by licenses and their huge brand name and its perception tied to the way the produced decades ago.
All of the pro-Lego arguments having to do with quality and support of european manufacturing have either mutated into lies or are on their way out. I find it ludicrous that most of my bootlegs are more color consistent and have better clutch power without cracking and breaking within the first few months.
@LegoSonicBoy said:
"A noteworthy lack of LEGO City and LEGO Friends in the top-performing themes. Classic remains, well, a classic, though I do have a problem with its PPP ratios in recent years.
"
My main "issue" with the current Classic , is that you only get a few of each piece and there are like 20 colors.
More colors is more variation, sure, but only getting a few of each color in a Classic box doesn't really compare to the old Basic type buckets which had like 4-6 colors.
But I can see they have a different purpose now, and not "bulk bricks" then the current Classic makes sense, to build mostly small things with imagination.
I did like the 2018 40th anniversary brick boxes more however as they had some basic minifigs + space/pirates/castle accesoires and overall a bit more varied parts.
1st half year City and Creator 3-in-1 offerings were fairly weak, Summer sets being a bit better.
@CrimsonFury said:
TLG posts regular growth most years. You must have a strange definition of what a dying brand is.
Notice I havent say its dead. Im saying its dying.
More and more people notice how quality of Lego is dropping every year. The drop in sales will hit Lego in 10 more years if they will not change.
I personally don't care about Licensed themes, but I do hope City will remove it's silly Adventures show focus after 2020, and Creator 3-in-1 going back to more buildings/houses.
3-in-1 Summer set offerings going into Space and Pirates is a nice addition though.
My god, LEGO releases a standout earnings report at a time when most companies are struggling, and the majority of the posts are negative and people talk about "LEGO dying".
What a bunch of....!
@CrimsonFury said:
" @Brickmasterboy said:
"Speed Champions?
Great news. I'm both surprised and not surprised. Surprised because the theme only offers cars which I don't consider appeal to the majority.
Not surprised because of the quality the theme offers in terms of design and range of models ."
I would think cars appeal to a large chunk of their male audience. Also 2020 marks an overhaul to speed champions where they changed from 6 studs wide to 8 studs wide which allows a lot more detail in the shapes they can create. For me this years speed champions were the first ones I've purchased because I felt the aesthetic improved significantly. The details on the Ferrari F8 are amazing for a model with ~220 pieces "
Agreed, there's hard to find a theme that offers more details for the part counts. Got the Ferrari as well and now when they got wider, I feel a slight glimpse of nostalgia reminding me of the bigger Ferrari's that used to be within the "Racers" theme. My personal favorite was the Audi though, a perfect reincarnation since it already was boxy. Love how they managed to make the fenders look so wide yet accurate
@Antoine_23 said:
" @Osteele98 said:
" @fakespacesquid said:
" @Miamibear said:
"Apparently the excessive price increases haven't hurt sales... for now."
Excessive price increases where? Star Wars is the only theme that’s had a bad PPP more often than not but the popularity gets it through. Virtually every other theme has had prices ranging from fair to great. Just because a price is big doesn’t mean it’s bad."
City also suffers from this, as do Marvel and Jurassic sometimes
"
Where do you see « fair to great » for super Mario?"
The Mario lines are fair considering what you get, all of the 'mob' builds are solid and amount of new pieces can't be ignored. Most Jurassic sets hang around 11/13 cents per piece and considering the massive dino molds, I think it's fair to call that fair. Venomsaurus is the only Marvel set with a price that's a bit high, but then again that's the only Marvel set I've gotten recently so clearly there's some value there. City, I'll say maybe half of the sets present a good value and half are overpriced
(Edit: a small Mario anecdote. I've been to the three LBR stores in my area as well as two Targets and a Walmart and absolutely none of them have a Mario starter course in stock. That kind of demand wouldn't be there if the price wasn't fair)
@CCC said:
" @LegoDavid said:
"So, all the top selling themes are licensed ones? Ouch.... Not a good sign.
"
Classic isn't licensed.
But it is a sign that licenses are fuelling LEGO's growth.
"
Technic is also not licensed half the time. Too many youngsters in this comment section who don't seem to recall that Star Wars and Harry Potter are what saved Lego from collapsing. I don't think I'll ever understand the dislike for licensed themes.
Interesting stuff. Although it kinda is hard for me to see not many of LEGO’s original IPs or non-licensed themes are up too anymore. For all the talk about creativity and such, it feels a little awkward to see the aisles and such packed with big name brands and not much in the way of themes flexible enough to let kids go nuts.
As for the whole China ordeal, I think LEGO should be alright. Their brand is usually designed to be pretty clean and non-offensive, so it’s nice to know the kids over there will be getting to enjoy something I’ve also enjoyed all my life now. Plus if a set is a no-go over there, they could easily just not release it in that region. They’ve got a whole world to sell to outside of China. Although, that press release for Monkie Kid was kinda cringeworthy to read given how much it praised China despite being a nation that treats people more like tools and commits open genocide and tried passing the blame on a global pandemic elsewhere. Yeah. Wukong would be ashamed.
Keep the China stuff in China. Don’t let it affect the rest of the world, and ESPECIALLY don’t pull what companies like Blizzard have done in terms of censoring free speech and the like.
@hackenbacker said:
" @LegoSonicBoy said:
"A noteworthy lack of LEGO City and LEGO Friends in the top-performing themes. Classic remains, well, a classic, though I do have a problem with its PPP ratios in recent years."
By definition, not everything can be a top performing theme. It doesn't really matter if something isn't performing as well, so long as it is profitable and serving a market.
But I would say it is noteworthy that City and Friends is what you've picked up on. Creator / Creator Expert is also missing from the list, which is interesting when it's an important product line for AFOLs."
Yeah, Creator was a noteworthy omission too. I pointed out City and Friends because they tend to be mentioned in most financial reports. It was unusual to see neither this time around. But given the direction City has been taken in this year, and the whole police thing going on in the world, I can't say I'm surprised.
I'm not sure what LEGO calls their AFOL-oriented category now that Creator Expert is history, but my guess is it's too soon for them to judge how it's performing since it was only introduced sometime this year. Hopefully we'll see some insights in the next one.
@TeriXeri said:
" @LegoSonicBoy said:
"A noteworthy lack of LEGO City and LEGO Friends in the top-performing themes. Classic remains, well, a classic, though I do have a problem with its PPP ratios in recent years.
"
My main "issue" with the current Classic , is that you only get a few of each piece and there are like 20 colors.
More colors is more variation, sure, but only getting a few of each color in a Classic box doesn't really compare to the old Basic type buckets which had like 4-6 colors.
But I can see they have a different purpose now, and not "bulk bricks" then the current Classic makes sense, to build mostly small things with imagination.
I did like the 2018 40th anniversary brick boxes more however as they had some basic minifigs + space/pirates/castle accesoires and overall a bit more varied parts.
1st half year City and Creator 3-in-1 offerings were fairly weak, Summer sets being a bit better."
Totally agreed.
@fakespacesquid said:
" @CCC said:
" @LegoDavid said:
"So, all the top selling themes are licensed ones? Ouch.... Not a good sign.
"
Classic isn't licensed.
But it is a sign that licenses are fuelling LEGO's growth.
"
Technic is also not licensed half the time. Too many youngsters in this comment section who don't seem to recall that Star Wars and Harry Potter are what saved Lego from collapsing. I don't think I'll ever understand the dislike for licensed themes."
Actually, it was Star Wars and Bionicle. HP came along after LEGO returned to profitability and was growing nicely.
@gylman said:
" @fakespacesquid said:
" @CCC said:
" @LegoDavid said:
"So, all the top selling themes are licensed ones? Ouch.... Not a good sign.
"
Classic isn't licensed.
But it is a sign that licenses are fuelling LEGO's growth.
"
Technic is also not licensed half the time. Too many youngsters in this comment section who don't seem to recall that Star Wars and Harry Potter are what saved Lego from collapsing. I don't think I'll ever understand the dislike for licensed themes."
Actually, it was Star Wars and Bionicle. HP came along after LEGO returned to profitability and was growing nicely. "
Bionicle and HP started in the same year so I don't quite buy that
@gylman said:
" @fakespacesquid said:
" @CCC said:
" @LegoDavid said:
"So, all the top selling themes are licensed ones? Ouch.... Not a good sign.
"
Classic isn't licensed.
But it is a sign that licenses are fuelling LEGO's growth.
"
Technic is also not licensed half the time. Too many youngsters in this comment section who don't seem to recall that Star Wars and Harry Potter are what saved Lego from collapsing. I don't think I'll ever understand the dislike for licensed themes."
Actually, it was Star Wars and Bionicle. HP came along after LEGO returned to profitability and was growing nicely. "
No they didn’t. They arrived in 1999. LEGO struggled well into the early 2000’s and continued to make errors like scala and galidor up to 2004.
What is worth mentioning however, in the discussion on Lego’s dark ages, is the role Bionicle played. Many credit Star Wars as saving LEGO but the original IP theme Bionicle largely contributed to Lego’s financial uptick. It was cheaper to make than Star Wars and sold like hot cakes, matching or in some quarters out-selling Star Wars sets.
@fakespacesquid said:
" @CCC said:
" @LegoDavid said:
"So, all the top selling themes are licensed ones? Ouch.... Not a good sign.
"
Classic isn't licensed.
But it is a sign that licenses are fuelling LEGO's growth.
"
Technic is also not licensed half the time. Too many youngsters in this comment section who don't seem to recall that Star Wars and Harry Potter are what saved Lego from collapsing. I don't think I'll ever understand the dislike for licensed themes."
Star Wars and Harry Potter were popular, but they still struggled with sales in-between movie releases. Bionicle, on the other hand, remained consistently popular throughout LEGO's financial dark age. That's why the credit of saving the company should go to Bionicle, not SW or HP.
Most of this growth is in China, with 80 new retail stores planned there compared to 40 for the rest of the world (global.chinadaily.com.cn, 2 Sept 20), so expect to see Monkey King in the top theme list by next year.
Possibly Technic is the top performing theme if lots of AFOLs have been purchasing expensive supercars, Liebherrs etc. while stuck at home, with possibly minimal advertising, franchise and licensing costs compared to other themes.
@LegoSonicBoy said:
"A noteworthy lack of LEGO City and LEGO Friends in the top-performing themes."
City went downhill lately and this year was painful with exception of Ocean Exploration. It's sad to see.
I kinda already knew that LEGO was getting a spike in sales, but purely because stores in my area were quite lacking in sets. You walk in, and find that the store is almost fresh out of toilet paper, hand sanitizer, and LEGO sets. Apparently, I think that several people saw the quarantine orders, and decided to pick up a new hobby, and for those who already had LEGO as a hobby, they saw it as an excuse to spend more time with it. All of it makes sense in my mind, and frankly, I say that it's great! LEGO is an excellent turn-to if you're bored. Congratulations LEGO Group!
@jaredhinton said:
" @gylman said:
" @fakespacesquid said:
" @CCC said:
" @LegoDavid said:
"So, all the top selling themes are licensed ones? Ouch.... Not a good sign.
"
Classic isn't licensed.
But it is a sign that licenses are fuelling LEGO's growth.
"
Technic is also not licensed half the time. Too many youngsters in this comment section who don't seem to recall that Star Wars and Harry Potter are what saved Lego from collapsing. I don't think I'll ever understand the dislike for licensed themes."
Actually, it was Star Wars and Bionicle. HP came along after LEGO returned to profitability and was growing nicely. "
No they didn’t. They arrived in 1999. LEGO struggled well into the early 2000’s and continued to make errors like scala and galidor up to 2004.
What is worth mentioning however, in the discussion on Lego’s dark ages, is the role Bionicle played. Many credit Star Wars as saving LEGO but the original IP theme Bionicle largely contributed to Lego’s financial uptick. It was cheaper to make than Star Wars and sold like hot cakes, matching or in some quarters out-selling Star Wars sets.
"
This! Quoting the book "Brick by Brick" by David C. Robertson:
"By late 2003, the LEGO Group's leaders finally began to concede that the glowing success of LEGO Star Wars, as one executive put it, was ultimately a "thick, fat layer of cosmetics" hiding the raw blemishes of a sickly core business. By November of that year, it was apparent that all the rouge and mascara had melted away. Without a Star Wars movie, LEGO couldn't reprise the line's explosive growth, and sales rapidly lost altitude." (p90)
"In early 2004, an internal survey of the company's entire product portfolio revealed that 94 percent of LEGO sets were unprofitable. Only Star Wars and Bionicle kits were making money." (p98).
"In 2003—the year the rest of LEGO came crashing down—BIONICLE's soaring sales accounted for approximately 25 percent of the company's total revenue and more than 100 percent of its profit (as the rest of the company was tumbling to a net loss), making it a financial anchor in turbulent times." (p155)
The chapter about Bionicle even begins with a quote from Jorgen Vig Knudstorp himself, stating in no uncertain terms: "Bionicle is the theme that saved LEGO." (p151).
That said… I don't see anything here that's particularly worth panicking over? After all, most LEGO sales tend to happen in the second half of the year anyhow, as the holiday shopping season picks up. That's why LEGO tends to release a lot of their higher-priced sets in the second half of the year, along with a lot of the more unique, attention-grabbing subthemes like City Ocean Explorers, Friends Jungle Rescue, etc. By comparison, themes like Disney Princess and Speed Champions typically have few or no new sets released in the second half of the year.
@Judge_Fudge said:
"Lego is dying because most parts are qualitatively worse than other brands and even bootlegs now. A trend started in 2017, the year that Lego got into trouble because they once didn't have the growth they wanted.
If it weren't for Harry Potter having so many decent builds (unlike every other theme since 2013) and interesting minifig parts (even in spite of the milky plastics), I don't think I would buy more than one or two D2C sets per year and a couple hundred bucks of B&P stuff.
At this point they are only getting carried by licenses and their huge brand name and its perception tied to the way the produced decades ago."
If you truly believe that Harry Potter is the only theme with decent builds since 2013 (disregarding themes as popular and varied as Ninjago, Friends, Elves, Hidden Side, Monkie Kid, Speed Champions, Star Wars, Ghostbusters, Creator Expert, Ideas, and all four LEGO Movies), you're really just illustrating how few LEGO fans your tastes actually align with. :/
Strong results from this privately held company that releases financial reports anyway for some reason. I think people may be more interested in Lego for entertainment given the closure of traditional entertainment venues from the pandemic.
However, one thing I have noticed is that the best-performing brands vary quite frequently in these reports. To me, this suggests that all the themes perform quite similarly, and the difference is often small, a few % here and there.
The current Harry Potter lineup is probably the strongest the theme has ever been. I've often found the builds in that theme to be quite bad, but 75980 is very aesthetic, and 75978 is obviously a hit.
Was it not the 1st half of 2019 which they did not improve on 2018 numbers, and immediately layed off 500 members of staff. I guess this would make your 2020 operating costs look better.
@meesajarjar72 said:
"Now they can afford to employ a few more staff to fulfill the bricks and pieces orders.."
The problem might be the requirement for social distancing and more cleaning, not a lack of workers.
@Zordboy said:
"Of course Lego has done really well, the last six months. Everyone was stuck at home with nothing else to do.
I've spent a lot on Lego, this year, but it hasn't been new sets. Mostly I've been browsing eBay and Bricklink and buying older sets. I guess that's my thoughts on this year's range, but I don't think 2020 has been a great year. Almost everything (aside from Ninjago) has been really lacking. "
I remember hearing this back in 2004-2005.
First of all, I wonder what effect adults as the end user had on the sales?
Secondly, I wonder if the dumb TV show has hurt the sales of City? That and the fact I know last time (pre-COVID) I was in Walmart, City sets were shoved in a small area at the end of the aisle like some cheap off brand.
Interesting and odd to see City isn't on the top themes list. Hope it picks itself up soon! Glad LEGO in general has been doing well though.
@cody6268 said:
"First of all, I wonder what effect adults as the end user had on the sales?
Secondly, I wonder if the dumb TV show has hurt the sales of City? That and the fact I know last time (pre-COVID) I was in Walmart, City sets were shoved in a small area at the end of the aisle like some cheap off brand. "
That and as someone else noted, the police sets being scaled back for promo. Doesn't help that they have a new police theme at the worst possible time either with a suprise summer police wave.
@Judge_Fudge said:
"Lego is dying because most parts are qualitatively worse than other brands and even bootlegs now. A trend started in 2017, the year that Lego got into trouble because they once didn't have the growth they wanted."
This is unfortunately true. I got a bootleg Pterodactyl set this year with parts that had better colour consistency than the two 2020 sets I’ve got so far. Unfortunately I haven’t been interested in really anything that was put out this year, and only ended up buying a single 501st set and the Spider-Man mech. The rest of my money went on buying tons of Mars Mission sets off eBay.
@ALEGOMan said:
" @fakespacesquid said:
" @Miamibear said:
"Apparently the excessive price increases haven't hurt sales... for now."
Excessive price increases where? Star Wars is the only theme that’s had a bad PPP more often than not but the popularity gets it through. Virtually every other theme has had prices ranging from fair to great. Just because a price is big doesn’t mean it’s bad."
look at marvel it's just as bad as sw if not worse in some sets"
I’ve already addressed that, look up a bit
All five of my 2020 sets are under $20, most sets worth buying this year are $100-$200+. The frequently awful PPP ratios in Star Wars and Marvel sets are a bummer. I have mostly been looking at buying older sets (that haven't doubled in price).
I think I’ve only bought the Batmobile this year. I’d have been all in on Monkey Kid if it wasn’t for the exorbitant prices of those sets.
LEGO City lacks innovation in recent year with endless police and fire sets. No wonder it's no longer top selling. Such shame for an one of the biggest themes.
@cody6268 said:
"First of all, I wonder what effect adults as the end user had on the sales?
Secondly, I wonder if the dumb TV show has hurt the sales of City? That and the fact I know last time (pre-COVID) I was in Walmart, City sets were shoved in a small area at the end of the aisle like some cheap off brand. "
The TV show itself would've either helped or not helped at all, but I doubt it would've hurt. It's the sets being tied in to the TV show that would've hurt their own sales — a lot, I'm sure.
I am sorry to see some comments about China as I am Chinese. Some comments are ridiculous. Have you been to China, have you talk with Chinese about something, have you seen China by your eyes instead of screen or paper? I have been to Europe and US for many times. English, Chinese and Math are the only 3 mandatory lessons for all Chinese kids. That means we can easily read everything in English whether it's good or bad for China or CCP. We know the things our government did, also the other countries things, from English press, maybe by VPN. Some choose to like CCP while the others didn't. Both are ok, but what's the relationship between China and Lego? You like Lego, and you don't like China. So Lego can't like China? Come on, Lego is just a toy for adult and Child, that's just play it.
I like Star War, I don't like Monkey kid. My son like it but I know most of their designs are rubish, becuase most Chinese adult have a very deep understanding of the Monkey king story while the designer doesn't. Hope Lego can earn more and more money from China and help this brand better and better until my son grown up. He will be proud he has a famous toy 20 years ago.
if it wasn't for this Razor Crest and Osprey debacle they might have a perfect year. Though the former probably has had more impact. Still people love LEGO. Going probably in the 5th or 4th generation playing with LEGO bricks.
@gejunjie said:
"I am sorry to see some comments about China as I am Chinese. Some comments are ridiculous. Have you been to China, have you talk with Chinese about something, have you seen China by your eyes instead of screen or paper? I have been to Europe and US for many times. English, Chinese and Math are the only 3 mandatory lessons for all Chinese kids. That means we can easily read everything in English whether it's good or bad for China or CCP. We know the things our government did, also the other countries things, from English press, maybe by VPN. Some choose to like CCP while the others didn't. Both are ok, but what's the relationship between China and Lego? You like Lego, and you don't like China. So Lego can't like China? Come on, Lego is just a toy for adult and Child, that's just play it.
I like Star War, I don't like Monkey kid. My son like it but I know most of their designs are rubish, becuase most Chinese adult have a very deep understanding of the Monkey king story while the designer doesn't. Hope Lego can earn more and more money from China and help this brand better and better until my son grown up. He will be proud he has a famous toy 20 years ago."
There is such an American misconception about China overall, and it bothers me. Particularly in regards to referencing ‘China’ collectively as one identity, grouping everyone and everything over there as a single thing. It’s a prevalent attitude today though I think that’s how things are most of the time everywhere. Our President makes bashing China an everyday occurrence and many US citizens feel empowered to take this position, though it only succeeds in making all of us look bad.
Then again, Americans overall are being painted with a broad brush stroke overseas as well because of the current administration and so I completely understand how you feel. So often the regular people, you and me...Dads who enjoy LEGO and who have kids who like LEGO, just want to be regular people and live our life and be good fathers and husbands and workers...and we don’t want to be labeled according to any perceived ideologies or governments.
I’ve been to China around a dozen times or more. I used to work in a manufacturing industry so I was gifted with an opportunity to see a lot of different aspects of your country. It’s not that different than here. The people aren’t that different than here. People are just people. Languages change, culture, skin, hair...but inside we all are just people.
Why the world doesn’t understand this simple concept is truly beyond my understanding.
Your comment is appreciated and has made me want to research the Monkie Kid/King. I don’t know much about it and my son picked up a couple of sets now and I am much more curious about the origins.
@gejunjie said:
"I am sorry to see some comments about China as I am Chinese. Some comments are ridiculous. Have you been to China, have you talk with Chinese about something, have you seen China by your eyes instead of screen or paper? I have been to Europe and US for many times. English, Chinese and Math are the only 3 mandatory lessons for all Chinese kids. That means we can easily read everything in English whether it's good or bad for China or CCP. We know the things our government did, also the other countries things, from English press, maybe by VPN. Some choose to like CCP while the others didn't. Both are ok, but what's the relationship between China and Lego? You like Lego, and you don't like China. So Lego can't like China? Come on, Lego is just a toy for adult and Child, that's just play it.
I like Star War, I don't like Monkey kid. My son like it but I know most of their designs are rubish, becuase most Chinese adult have a very deep understanding of the Monkey king story while the designer doesn't. Hope Lego can earn more and more money from China and help this brand better and better until my son grown up. He will be proud he has a famous toy 20 years ago."
The reason so many Americans are distrusting of China is primarily because China’s leadership has proven time and time again to be sneaky when it comes to taking control of things. If LEGO wants to sell sets in China, I have no problem with that, but I don’t want China’s rules to become the rules standard for the rest of the world.
The last thing I want is for LEGO to become like the videogame and movie industry where they sacrifice freedom of creativity and occasionally surprise freedom of speech for the sake of some money.
I am glad that the people over there are now getting to enjoy a lot of the stuff we have, actually! Really, I am. LEGO has brought me a lot of joy over the years and continues to do so, and I hope the people over there can have the same fun with it that I did now.
But like it or not, the leadership of a country is what represents everyone. That’s true of both the United States and China.
Absolutely agree. I myself have no quarrel with the Chinese people, however, as you say, China as a nation state is very concerning to world peace and security.
And the action of a nation's government is usually how that nation is seen internationally. That is the same for all countries, including Australia. I myself do see a very large amount of rude, racist, common/hick people around which sadly far outnumber the true Australians.
I find it very puzzling the amount of specifically white Australians (anglo saxon) who fervently support China, sometimes even likely more so then Chinese nationalists!
For example "It's Australia's own fault for having sanctions placed against it" Finding out how and why a virus started is a perfectly reasonable course of action for the global community in a pandemic.
These same individuals will claim to stand up for Muslims and love accusing everyone else of being Islamophobic, yet refuse to allow any criticism of the nation what seeks to commit Holocaust 2.0 against a Muslim minority???
Finally, how can a free, democratic, multicultural nation allow attacks on its citizens and guests for being pro-democracy? Currently any Chinese student who supports either the Hong Kong protests or democracy in general is beaten, harassed, bullied and threatened by their nationalist classmates or the CCP itself. I find it really sad that there are so many good, kind Chinese people but because the CCP has so much power, many are forced to commit acts of subversion against host countries otherwise the students family in China will be murdered.
To get back to Lego, what people forget is, The Lego Group doesnt give a damn about the happiness of Chinese children. Its only interested in money.
After all, Im sure theres thousands of Indian, Brazilian and Russian children who would love to own Lego too but the Chinese market has a higher socio-economic demographic, i.e there are more middle to upper class wealthy Chinese people to buy Lego.
I dont think anyone here has a problem with Chinese children getting to experience the Lego System of Play. The issue is that, as I pointed out previously, this current world has seen an unusual amount of, typically Western individuals and companies, who for whatever reason choose to become pro-CCP. This is mostly about money.
In Australia, the government would take more action to protect our national interest (such as diversifying trade options) however large companies complain that they will loose too much money.
Hence, we have already seen Lego sway to political correctness in many cases, now with the continued push into China, the interests of the CCP will influence the thought processes of The Lego Group. Some fans may celebrate in getting more Asian themed sets, this may occur, but Chinese influence, as in many other companies will extend far beyond a couple more Chinese New Year sets each year....
Another year, another umpteen million into the Kristiansen's pockets.
After 15 years they still haven't figured out how to calibrate their machines for consistent colour.
They really need to fix that embarrassing issue soon, like 10 years ago.