The toy industry had a challenging first quarter but JAKKS Pacific fared better than expected.
The company reported an 11% decline in net sales to $107.5 million while its margins and profit increased slightly. On a global level, JAKKS’ action play and collectibles business spiked 19% driven largely by strong sales for products tied to The Super Mario Bros. Movie to partially offset a 23% drop in sales for dolls and role-play products.
“We are pleased with our year-to-date performance as we close the first quarter and are excited about the possibilities for the remainder of the year,” says JAKKS Pacific Chairman and CEO Stephen Berman. “We shipped more than $100 million worth of product in Q1 for the second consecutive year and it is the first time we’ve done that in back-to-back years since 2009. We have challenging revenue comparisons all year, but our significant gross margin improvement lessened the impact in the first quarter.”
JAKKS is seeing strength in international markets this year with a 7% gain in sales for toys and consumer products while the Disguise costumes business saw a 64% spike for the quarter. Berman says that much of the growth is coming from Latin America, a sentiment echoed by much of the industry.
Looking ahead, JAKKS expects to see sales increase in the back half of the year powered by continued momentum from its gaming-inspired products, Disguise, and upcoming entertainment properties, including Disney’s The Little Mermaid and Wish.
