Will Connected Toys Propel LeapFrog Forward?

Before going into analysis of LeapFrog’s (NYSE:LF) recent quarter, let’s take a look at some numbers that put the company’s situation into context: Worldwide toy sales reached $78 billion in 2008, registering a 0.8% decline over the year, according to a recently released NDP Group report. At constant exchange rates, sales would have increased 2.3% over the year. The United States is the biggest market for toys and contributes 30% of the global share. Within the country, sales fell 2% over the year to $21.7 billion, but board game sales grew 6% over the year to $794 million. The global toy market is expected to grow to $80.3 billion by the year 2012, with growth being driven by emerging markets. >>>

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Promising New Products At LeapFrog

LeapFrog (NASDAQ:LF) continued to struggle with the recessionary pressures. The recently announced Q1 performance resulted in a loss while revenues nearly halved over the year. The worldwide edutainment market is still growing rapidly — according to InStat, it was $2.1 billion in 2006 and is expected to be $7.3 billion in 2011 — but as for so many markets, people are cutting spending on toys and other products for children. Perhaps My Pal Scout, the company’s new customizable talking plush puppy, will help boost revenues >>>