Mattel said Thursday that second-quarter earnings surged 20% despite price increases. This shows that consumers continue to buy Polly Pocket dolls and mega construction sets despite rising inflation.
The toy maker said in a statement that revenue for the period from April to June was $ 1.2 billion, up from $ 1 billion in the same quarter last year. After reporting a loss of $ 5.5 million last year, the company made a profit of $ 66.4 million in the fourth quarter.
After struggling for several years, the company has been in a turnaround mode since Ynon Kreiz became CEO in 2018. Second-quarter revenue was the result of efforts to leverage intellectual property and expand entertainment offerings. Kreis said in an interview Thursday.
One of Mattel’s biggest franchises, Barbie, will appear in a live action movie starring Margot Robbie next year, and JJ Abrams production company Bad Robot recently produced a live action movie based on Mattel’s Hot Wheels line. Signed.
“We really moved from the manufacturer that made the item to the IP-led company that manages the franchise,” Kreiz said. “We are currently in growth mode.”
Strong profits from toy makers came in spite of rising material costs and rising inflation, which rose 9.1% in June, putting pressure on consumers when food, gas and rent costs were soaring. doing.
However, Linda Bolton Weiser, an analyst at DA Davidson in the toy industry, says toy sales tend to be resilient to downtime because parents don’t want to disappoint their children.
“Toys are considered to be soft, periodic,” she said. “They really hold up in the recession.”
Like its main rival Hasbro, Mattel faces new threats with a stronger dollar. According to the company, profits would have been 4 percentage points higher if foreign currency rates had not fluctuated overseas.
“This will hurt many multinationals,” Bolton Weiser said. “The dollar is rising every day.”
Mattel’s share price has risen steadily since it fell to $ 7.42 early in the pandemic.
