Barbie maker Mattel’s grim annual forecasts, quarterly miss sink shares
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MATTEL on Tuesday forecast full-year profit below Wall Street expectations after missing fourth-quarter estimates, as weak discretionary spending weighed on toy demand, sending shares of the toymaker slumping about 21 per cent after the bell.
The outlook comes as the company aims to build an entertainment portfolio around its brands. It hopes to repeat the success of the 2023 blockbuster Barbie with a live-action Masters of the Universe film in June and the Matchbox movie on Apple TV in October.
US shoppers remained cautious through the key holiday season, traditionally a sales driver for toymakers, with inflation and economic uncertainty curbing purchases.
Heavy promotional activity in December pressured margins, CEO Ynon Kreiz told Reuters, adding US segment sales during the month grew “less than expected.”
Rival Hasbro forecast muted annual revenue growth even as it beat estimates for fourth-quarter results earlier on Tuesday.
Mattel expects 2026 adjusted earnings per share of US$1.18 to US$1.30, below analysts’ average estimate of US$1.75, according to data compiled by LSEG.
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Fourth-quarter net sales rose 7 per cent to US$1.77 billion, missing expectations of US$1.84 billion. Adjusted earnings of 39 cents per share fell short of the 54 cents estimate.
The company, which unveiled a US$1.5 billion share buyback plan to be completed by 2028, said it had fully offset the US tariff cost impact through measures including supply-chain diversification and product optimisation.
Entertainment push
The company said it would acquire the remaining 50 per cent of Mattel163, a joint venture media games developer created with China’s NetEase for US$159 million, as it targets growth in self-published digital gaming.
“We’re looking to capture the full value of our intellectual properties in high-margin, highly accrued areas,” Kreiz said.
“Especially when it comes to digital, we see that as an area where our brands lend themselves well to games and mobile games specifically.”
Supported by about US$150 million in revenue from the acquisition, Mattel forecast that sales this year would rise 3 per cent to 6 per cent.
The company also announced a multi-year licensing deal with Paramount Skydance to develop and market Teenage Mutant Ninja Turtles products starting in 2027. REUTERS
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