The data: The US toy industry returned to growth for the first time since 2023, per Circana.

Total dollar sales rose 6% YoY, average selling prices increased 6%, and units sold grew 3%.

Zooming in: Growth was K-shaped. Toys priced between $30 and $69.99 surged 18%, the fastest of any segment, while those priced below $5 and between $15 and $19.99 posted the steepest declines.

The shift reflects rising demand for collectibles, premium, and feature-rich products. Only six of the 11 categories tracked by Circana posted dollar growth, led by games and puzzles, the largest supercategory, which jumped 37%, thanks largely to Pokémon. Building sets rose 15%, fueled in part by licensed properties such as Formula 1, while exploratory and other toys climbed 20% on strong NFL trading card demand. Together, those three supercategories accounted for 92% of the industry’s growth last year.

At the other end of the spectrum, outdoor and sports toys, plush, and dolls declined, with early 2025 weather disruptions weighing on seasonal categories.

Implications for brands: US toy and hobby sales grew 4.6% last year, according to our forecast, but growth is expected to slow to 3.0% this year. That deceleration raises the stakes for brands to capture share, and many are turning to intellectual property as a key growth lever. Entertainment, sports, and gaming licenses continue to underpin performance, reinforcing the power of fandom-driven purchasing in the toy aisle.

Hasbro, which beat top- and bottom-line expectations in Q4 2025, offers a clear example of the strategy. The company credited its outperformance to momentum in entertainment and licensing. It recently added KPop Demon Hunters as a co-master toy licensee—paving the way for a Monopoly crossover and other interactive formats—and secured a deal with Warner Bros. to become the primary toy licensee for the World of Harry Potter and the upcoming HBO Original “Harry Potter” series.

In a bifurcated and slowing market, brands anchored to strong, multiplatform IP are best positioned to command premium price points and sustain momentum.