We expected a difficult comparison this year, and this has been compounded by the significant reduction in inventories and increased seasonality of purchasing patterns at Toys 'R' Us.

Alan Hassenfeld

Comparison Compounded Difficult Expected Increased Inventories Reduction Significant Year

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It was a significant reduction.

— Walt Blomberg

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Our earnings growth is especially gratifying in this seasonally low-revenue quarter, when we continue to incur fixed infrastructure costs including acquisition carrying costs.

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Wizards of the Coast will enable us to significantly expand in the fast-growing games arena, which is a cornerstone of our growth strategy for the new millennium.

— Alan Hassenfeld

It sounds small on a daily basis. But compounded over the entire winter season, it is significant.

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Even a small reduction in errors and rework can have a significant impact.

— Abigail Johnson

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