Mattel Adjusts Forecast Amid Barbie Sales Decline

Mattel, Inc. reported stronger-than-expected third-quarter earnings per share (EPS) at $1.14, surpassing analyst expectations, although quarterly revenue of $1.84 billion fell short of estimates, prompting a reduction in the full-year sales forecast. The decline in sales, attributed to a 17% drop in Barbie merchandise billings post-last year's movie bump, led the company to adjust its 2024 net sales outlook to flat or slightly down from $5.44 billion. Analysts have varied responses; Morgan Stanley raised its price target to $22 but expressed caution over fourth-quarter EPS guidance, while Goldman Sachs also adjusted its target to $22, citing limited long-term growth visibility. Despite this, Mattel's stock rose over 4% in after-hours trading, as investors were reassured by the company's strong gross margins and cost-cutting measures. CEO Ynon Kreiz emphasized ongoing strategic efforts to grow Mattel's IP-driven toy business and expand its entertainment offerings, positioning the company for expected growth in the upcoming holiday season and beyond. Mattel remains focused on achieving $200 million in savings by 2026 through supply chain optimization and improving profitability.