The turnaround at Mattel, Inc. continues as the company reported a 40% sales increase during the second quarter of this year. Like the rest of the toy industry, Mattel is now running up against skewed numbers due to the pandemic-fueled chaos that overtook the toy industry for much of Q2 last year. Reported operating income was $49 million, an improvement of $97 million, and adjusted operating income was $67 million, an improvement of $94 million
“This was another exceptional quarter for Mattel, with outstanding consumer demand for our product,” says Mattel Chairman and CEO Ynon Kreiz. “Our strength is foundational and broad-based. We believe we are in the strongest position we have been in many years to improve profitability and accelerate topline growth. This is an exciting time for Mattel.”
Mattel’s sales in North America increased 30% in the quarter as net sales for the first six months of the year scored a 43% increase overall.
Vehicles — including Hot Wheels (up 61%), Matchbox, and Disney•Pixar Cars led the charge alongside growth in dolls — including Barbie (up 41%), Spirit, and Polly Pocket; Action Figures, Building Sets, Games, and Other — including Jurassic World, Masters of the Universe (MOTU), WWE, and MEGA); and Infant, Toddler, and Preschool — including Fisher-Price (up 15%) and Thomas & Friends (up 14%). Notably, American Girl experienced a 43% sales increase marking its third consecutive quarter of growth; while MOTU, Jurassic World, and WWE led the action figure business to more than double versus the same period last year.
Gross billings for products ordered at retail boomed, with a 68% spike in Vehicles; a 44% increase in American Girl; and a 32% increase in Action Figures, Building Sets, Games, and Other.
One notable downside, which was expected, is that sales of games fell double digits as the company lapped exceptionally high comps from last year’s quarantine months.
Mattel CFO Anthony DiSilvestro says that the company guidance has been raised for the remainder of 2021 despite operating challenges, including the global shipping crisis, particularly the increased cost of containers. There will be a bigger negative impact due to those issues, which Mattel plans to counteract by cost-saving measures and retail price increases in Q4.
On the entertainment side of the business, Masters of the Universe: Revelation debuted last Friday on Netflix, and a second, kid-focused MOTU animated series, He-Man and the Masters of the Universe will premiere this fall. The long-in-development Barbie movie has been greenlit and is tentatively scheduled to hit theaters in 2023.