Mattel Stock Drops Following Q3 Sales and Earnings Miss Amid Tariff Disruptions

Mattel Shares Slide After Quarterly Results Disappoint

Mattel Inc. shares reportedly slumped in after-hours trading after the toymaker announced it missed both sales and earnings targets for the third quarter, according to the company‘s earnings release. The stock declined 5.3% following the announcement as investors reacted to the weaker-than-expected performance.

Mattel Shares Slide After Quarterly Results Disappoint
Financial Performance Details
Tariff Timing Impacts Retailer Behavior
Product Category Performance
Price Increases and Consumer Demand
Strategic Partnerships and Future Outlook

Financial Performance Details

Sources indicate the California-based company behind Barbie and Hot Wheels experienced a 6% decline in net sales to $1.7 billion during the quarter, falling short of analyst expectations. Net profit reportedly dropped by approximately 25% to $278 million, according to the financial report.

The company maintained its full-year guidance, with executives reportedly projecting net sales growth of 1-3% compared to last year’s $5.4 billion total. Analysts suggest this indicates management expects a stronger fourth quarter to compensate for the third-quarter shortfall.

Tariff Timing Impacts Retailer Behavior

The report states that retailer ordering patterns shifted significantly due to uncertainty surrounding U.S. tariffs ahead of the critical holiday shopping season. According to company executives, more retailers moved from direct imports – where they handle shipping from manufacturing countries – to domestic shipping arrangements where Mattel manages warehousing and imports.

“Given all the trade dynamics and macro uncertainty, what we saw is that retailers were pushing out decisions in terms of committing to buy product to a later period in the year,” Ynon Kreiz, Mattel chief executive, stated in an interview referenced in the report.

Product Category Performance

Worldwide gross billings for Mattel’s doll category reportedly fell by 11%, primarily driven by declines in Barbie sales. The company‘s infant, toddler and pre-school products segment experienced a more significant 25% decline in billings, according to the financial disclosure.

However, Hot Wheels products showed strength with an 8% increase in billings, helping to offset some of the weakness in other categories. The performance demonstrates the varying demand across Mattel’s product portfolio., according to recent developments

Price Increases and Consumer Demand

Mattel reportedly raised prices in July, partially in response to tariff-related cost increases. Despite these price adjustments, company executives indicated that U.S. consumer demand remains healthy and continues to grow.

“Retailers are now accelerating domestic orders,” Kreiz stated, according to the report. “In fact we see significant acceleration to restock their inventories to meet the expected consumer demand, including for the holiday season.”

Strategic Partnerships and Future Outlook

In a separate development, Mattel and rival Hasbro both announced licensing agreements with Netflix to produce toys based on “KPop Demon Hunters,” the streaming service’s most successful film. The partnerships represent strategic moves to leverage popular entertainment properties amid challenging market conditions.

Analysts suggest that the shift in retailer ordering patterns represents a timing issue rather than a fundamental deterioration in demand. The company’s maintained full-year guidance indicates management confidence that the delayed orders will materialize in the fourth quarter, potentially setting up for a stronger holiday season performance.