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Mattel Inc MAT

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Broad-Based Demand Lifts Profitability at Mattel, Indicating Its Brand Relevance Remains Intact

Jaime M. Katz, CFA Senior Equity Analyst

Analyst Note

| Jaime M. Katz, CFA |

Narrow-moat Mattel posted outstanding first-quarter results, even when accounting for the 14% sales decline in the year ago period. Total sales in the quarter handily outpaced our expectations (for 9% growth), rising 47% to $874 million—a first-quarter level last reached in 2016. Demand was widespread across the portfolio, with worldwide gross sales for Barbie rising 87%, Hot Wheels climbing 16%, and Fisher-Price & Thomas jumping 33%. Mattel also scored with its challenger categories (action figures, games, building sets), which saw gross sales up 69%. On the heels of this strength, expense leverage was healthy, driving a 3.2% adjusted operating margin; for reference, Mattel has failed to break even in any first quarter since 2014 as it is seasonally small.

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Company Profile

Business Description

Mattel markets toy products that are sold to its wholesale customers and direct to retail consumers. The company offers products for children and families, including toys for infants and preschoolers, girls and boys, youth electronics, handheld and other games, puzzles, educational toys, media-driven products, and plush and fashion-related toys. Mattel's owned portfolio includes Barbie, Hot Wheels, Fisher-Price, Thomas & Friends, and American Girl. In addition, it currently manufactures toy products for its segments both internally and externally (through outside manufacturers).

Contact
333 Continental Boulevard
El Segundo, CA, 90245-5012
T +1 310 252-2000
Sector Consumer Cyclical
Industry Leisure
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 32,100

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