Toy company Spin Master bracing for rising production, shipping costs from war

TORONTO – The war in the Middle East will soon make your kid’s favourite toys more expensive to produce and deliver to store shelves.

Spin Master Corp., the Toronto-based firm behind Paw Patrol, Gabby’s Dollhouse and Ms. Rachel toys, said Thursday that a blockage of one of the region’s key shipping routes is pushing up its freight, resin and packaging costs.

The impact has so far been minimal because the company had several contracts with suppliers that locked in commodity prices before the conflict began on Feb. 28.

But chief financial officer Jonathan Roiter said that will soon change.

“The actual cash that we have to start paying out, depending on whether it’s going to be on freight or on resin, it’s going to be sequenced between now and throughout the summer or late summer,” he told analysts.

Toy companies tend to use resin for figurines and other moulded parts.

Roiter’s forecast comes as the war enters its third month with the flow of goods and oil through the Strait of Hormuz still obstructed.

While several companies said they could handle the disruptions for a short amount of time because of prewar contracts like the ones Spin Master has, the longer the conflict stretches on, the more it’s expected to drive up prices and cause long-term damage.

Spin Master, for example, said it has contracts based on current oil prices, which have been hovering around US$105 per barrel lately.

“So, it’s a constantly fluid environment,” Roiter said.

Yet he was confident the company could navigate any turbulence because it experienced similar price hikes in 2012, 2014 and 2021 and always mitigated the impacts, he said.

Roiter offered the window into how Spin Master is coping with the war shortly after the company reported a first-quarter loss of US$32 million or 32 cents US per share.

The result compared with a loss of US$24.5 million or 24 cents US per share a year earlier.

On an adjusted basis, Spin Master, which keeps its books in U.S. dollars, said it lost 24 cents US per share in the period ended March 31 compared with a loss of 12 cents US per share in the same quarter last year.

Revenue for the quarter totalled US$328.5 million, down from US$359.3 million in the first quarter of 2025 when it saw customers rush to get orders in ahead of U.S. tariffs.

Toy revenue in the quarter reached US$240.9 million, down from US$273.7 million a year ago, while entertainment revenue amounted to US$40.8 million, up from US$37.8 million in the same quarter last year.

Digital games revenue was US$46.8 million, down from US$47.8 million in the first quarter of 2025.

CEO Christina Miller said the period saw “healthy” demand for Primal Hatch, DreamWorks Dragons, Monster Jam, Melissa & Doug and Gund products.

A hatching Yoshi toy it created for the recent release of “The Super Mario Galaxy Movie” sold out several times already and an Easter egg decorating kit from Melissa & Doug were particular hits, she said.

Moving forward, she said the company will keep building on that innovation but has also made the August release of “Paw Patrol: The Dino Movie” its “top priority for 2026.”

Miller said the movie will feature the first new Backstreet Boys song since 2019.

“On a related note, we recently hit a major milestone as Paw Patrol, the theme song, officially reached platinum status, driven by more than 150 million streams and placing it in the top one per cent of all TV-related music on streaming platforms,” she said.

“This achievement reflects the pups’ global reach, their staying power and the incredible engagement.”

This report by The Canadian Press was first published April 30, 2026.

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Note to readers:This is a corrected story. An earlier version incorrectly stated the percentage drop in first-quarter revenue.