If you’ve ever watched Shark Tank, you’ve seen this movie before: a hopeful entrepreneur pitches some flamingo-shaped spatula, and within 30 seconds, Kevin O’Leary is grilling them on margins and advising, “Move manufacturing to China.” 

That used to be sound business advice. Key word: used. Because those days might be over… at least for now. Thanks to Donald Trump’s newly juiced-up tariffs, manufacturing in China just went from “smart strategy” to “hold my hand while I light this business on fire.”

I knew it would be a high percentage but, 80% (yes, eighty freaking percent) of toys and games imported to the U.S. come from China. That’s right… the land of pandas, dumplings, and TikTok also happens to be Santa’s real workshop. So when Trump cranked up the tariff thermostat, he basically set fire to the entire toy aisle at Target.

Mattel and Hasbro (the Mickey Mantle and Babe Ruth) of the toy biz have been trading like they’re on clearance. Mattel shares hit a 52-week low of $13.95, while Hasbro dipped to $49. That’s a 27% and 20% faceplant, respectively, since Trump’s tariff announcement. It’s the worst beating these two have taken since kids figured out they could entertain themselves with iPads and YouTube.

Random fact of the day: toy margins are already thinner than the plot of a Fast & Furious sequel… high single digits if they’re lucky. So when tariffs jack up costs by triple digits, these companies have two options: raise prices or cry in a pile of unsold plastic (we all know they’re gonna raise prices). Industry experts are warning that toy prices could jump by 35% or more by the back-to-school season.

Greg Ahearn, CEO of The Toy Association (aka the guy trying to stop this from turning into a full-blown toy-pocalypse), had this to say: “Everyone is caught up in the economics of this, but they’re missing the human side… Products could see a 35% or higher price increase. It will put pressure on American families while limiting access to toys that are critical to child development” (couldn’t have said it better myself).

Long story short, if you’ve got part of your portfolio in toystocks, it might be worth rethinking your strategy.

Stocks.News has positions in Apple, Alphabet, Mattel, Target, and Hasbro.