Mattel is positioned for a strong holiday season following an earnings boom fueled by the global success of Barbie: The Movie.
For the third quarter, Mattel reported a 9% spike in net sales to $1.92 billion alongside gains in gross margin and operating income. Additionally, the company repurchased $60 million in its own shares and raised its 2023 guidance for adjusted gross margin, adjusted EBITDA, and adjusted earnings-per-share (EPS).
Mattel’s strong third quarter performance reflects the successful execution of our strategy to grow Mattel’s IP-driven toy business and expand our entertainment offering. Consumer demand for our product increased in the quarter, and we continued to outpace the industry. Our results benefited from the success of the 'Barbie' movie, which became a global cultural phenomenon, and marked a key milestone for Mattel. We are very well positioned competitively and expect to gain market share in the fourth quarter and full year. I would like to thank the entire Mattel organization for their achievements, hard work, and commitment to create shareholder value.”
Despite facing a challenging year, Mattel’s net sales slid just 5% in the first nine months, offset by gains in Q3.
North American net sales and gross billings grew 10% in Q3 versus the same period last year. Barbie, alongside Disney Princess and Disney Frozen, drove growth in Dolls while Hot Wheels fueled gains in Vehicles. Mattel notes that its growth was partially offset by declines across its Action Figures, Building Sets, Games, and Other category (primarily Action Figures), and in Infant, Toddler, and Preschool (primarily Thomas &
Friends).
Worldwide gross billings in Q3 saw a 27% spike for Dolls (including Barbie, Disney, and Monster High) and an 18% gain in Vehicles. Worldwide Gross Billings for Infant, Toddler, and Preschool dipped 2% in Q3 while Action Figures, Building Sets, Games, and Other fell 19%, primarily due to declines in Action Figures tied to 2022 theatrical releases.
Meanwhile, American Girl continues to decline, logging a 13% dip versus Q3 last year.
Looking ahead, Mattel expects net sales for 2023 to land in a comparable spot when compared to 2022.
Now, the race is on to develop the next entry into the potential Mattel cinematic universe. Following Barbie, numerous films are in development, including Hot Wheels, Matchbox, Wishbone, Barney, Magic 8 Ball, Rock ‘Em Sock ‘Em Robots, and the long-awaited Masters of the Universe.
