The LEGO Group Rocks Earnings Season with 14% Sales Growth

The LEGO Group, one of the few privately held major toy companies to disclose earnings, had a phenomenal first half of the year marked by double-digit gains.

LEGO reported a 13% increase in revenue, reaching $4.64 billion USD (DKK $31.0 billion), for the first half of the year, driven by strong consumer sales and an expanding market share. Consumer sales grew 14%, fueled by high demand for the company’s diverse portfolio. The company outperformed the broader toy market, gaining market share.

“We are very pleased with our strong performance in the first half. We delivered double-digit growth on the top- and bottom-line and made significant progress on increasing the amount of sustainable materials used in our products. Our portfolio continues to be relevant for all ages and interests, and this is driving significant demand across markets. We used our solid financial foundation to further increase spending on strategic initiatives which will support growth now and in the future to enable us to bring learning through play to even more children.”

— Niels B Christiansen, CEO

Looking closer at the numbers, operating profit surged by 26% to $1.21 billion USD (DKK 8.1 billion), supported by robust top-line growth, despite increased spending on strategic initiatives as planned. Net profit also rose by 16%, totaling $897 million USD (DKK 6.0 billion).

Free cash flow reached $449 million USD (DKK 3.0 billion), bolstered by the company’s strong performance. Investments continued in the construction of new factories and the expansion of existing facilities and offices.

In its sustainability efforts, LEGO reported that 30% of all resin purchased in the first half was certified mass balance, translating to an estimated average of 22% renewable and recycled materials used in the production of LEGO bricks.

Much of its success can be attributed to the fact that LEGO constantly reshapes itself to adapt to evolving consumer preferences and business needs. Its owned retail business, including physical stores and e-commerce, continues to grow, and that footprint powers brand awareness that results in sales for other retailers. Additionally, the company attracts new customers of all ages by offering innovative themes that work outside of the building and construction aisle, including high-end vehicle models, and botanicals.