U.S. toy industry returns to growth in 2025
After two years of flat or declining performance, the U.S. toy industry returned to growth in 2025. Total dollar sales rose 6%, driven by a 4% increase in average selling prices and a 3% rise in unit sales, according to Circana. Growth reflected renewed consumer demand, particularly for higher-priced and licensed toys. Compared to 2020, total U.S. toy sales are up 16%, representing a 3% compound annual growth rate over five years.
Regaining momentum
Juli Lennett, U.S. toys industry advisor at Circana, said the industry regained momentum in 2025, supported by stronger unit sales and a shift toward higher-value purchases. Licensed, collectible, and fandom-driven products continued to outperform, while the market showed increasing polarization between value options and premium offerings. Innovation and entertainment tie-ins remained key demand drivers.
Uneven growth across categories
Growth was uneven across categories. Six of Circana’s 11 tracked supercategories posted gains. Games & Puzzles, the largest segment, led with a 37% dollar increase, largely fueled by Pokémon. Building Sets rose 15%, supported by licensed themes such as Formula 1, and Explorative & Other Toys grew 20%, boosted by NFL trading cards. Together, these three segments accounted for 92% of total industry growth. Meanwhile, Outdoor & Sports Toys, Plush, and Dolls declined, partly due to early-year weather disruptions.
Licensing remained central
Licensing remained central to performance. Pokémon ranked as the top toy property, generating $2.5 billion in U.S. sales, up 87% year over year, and becoming the first property in at least two decades to exceed $2 billion in annual sales. Overall, six of the top 10 toy properties posted growth, many achieving double-digit gains tied to entertainment, sports, and video game franchises.
Higher price tiers
Higher price tiers gained share in 2025, indicating consumers’ willingness to spend more per item. Toys priced between $30 and $69.99 grew 18%, the fastest of any segment. Products priced above $20 collectively gained nearly four points of dollar share, while lower-priced ranges under $5 and $15–$19.99 saw the steepest declines. This shift supported overall price growth and reflected demand for premium, feature-rich, and collectible toys.
Uncertainties and tariffs
Looking ahead to 2026, Lennett noted strong momentum driven by licensing, collectibles, and a robust content pipeline, but also highlighted uncertainties. While tariffs have not yet significantly affected consumer prices, potential downstream impacts, along with inflation, credit pressures, and consumer confidence, could influence discretionary spending. Brands best positioned for success will be those that combine licensing and innovation, balance fandom with evergreen appeal, and build lasting emotional connections with consumers.
Source: https://www.circana.com/post/u-s-toy-industry-returns-to-growth-in-2025-circana-reports