Gifts / Sports & Toys

Following Hasbro, another American toy giant, Mattel, also announced its second quarter and first half results this year. Although exchange rate fluctuations affected the company's performance, both periods achieved 20% year-on-year growth in real exchange rates. Globally, most categories posted double-digit growth, but Europe and Asia Pacific were weak and not as strong as the Americas.

Increase revenue and reduce expenditure to offset the impact of the decline in gross profit

Since the current director and CEO Ynon Kreiz took office, Mattel has begun to implement plans to increase income and reduce expenditure. In the current situation of rising costs and sharp fluctuations in exchange rates, Mattel's approach is very effective.

Second quarter of this year: Net sales were US$1.236 billion, a year-on-year increase of 24% at constant exchange rates and 20% at real exchange rates, marking the eighth consecutive quarter of year-over-year growth. Although the gross profit margin decreased to 44.4% due to rising cost of sales, the actual net income was US$66.4 million, turning losses into profits, an increase of US$72 million year-on-year.

First half of this year: Net sales were $2.277 billion, an increase of 23% year-on-year at constant exchange rates and 20% at real exchange rates. The actual gross profit margin was 45.3%, which also decreased year-on-year. Actual net income also turned a profit, at $87.9 million, which was much better than a loss of $118 million in the same period last year. If you count the total revenue, it's more than $2.5 billion, an all-time high for Mattel.

To be able to achieve such results, of course, is inseparable from Mattel's policy of increasing income and reducing expenditure. Actively saving money and effectively managing costs are almost the items that Mattel must mention in the financial report. For example, in the second quarter of this year, there were savings of $22 million and $136 million in planned savings starting in fiscal 2021. Expected to save $80-90 million for the full year this year. It is expected to achieve a "small goal" of $250 million in savings by the end of 2023.

All categories achieve full-scale growth

It can be said that in the second quarter and the first half of this year, Mattel's products sold very well.

Among the three major brands, Hot Wheels is catching up with the leading Huadan "Barbie" in terms of total revenue, but the growth rate is almost three times that of it, and it is also the brand with the largest growth rate.

In terms of category, the toy cars to which Hot Wheels belongs are not as good as movable dolls/building blocks/games/other categories. The latter not only surpasses the former in terms of income, but also follows the doll category in terms of growth rate. The largest of all categories, over 40%.

Eurasian growth is sluggish

Specific to the performance of each region, the Americas (including North America and Latin America) region still maintained strong growth. Both regions achieved rapid growth of 30% or more in the second quarter of this year. In the first half of this year, growth in Latin America still exceeded 30%, while North America fell slightly to 28%.

Europe and Asia Pacific are significantly underperforming the Americas. In the European region, the increase in floating exchange rate and fixed exchange rate was almost double, which shows the great impact of exchange rate fluctuations. There is a similar phenomenon in the Asia-Pacific region.

Firmly implement IP-driven strategy

In the performance report, Mattel also specifically mentioned that the company will fully tap the value of its own IP, make progress in the vertical fields of high value-added business, and also hired executives to be responsible for the consumer goods and digital experience business, and informed the current IP content. Development progress:

In closing, Ynon Kreiz concluded: "Despite significant inflation, Mattel delivered an extraordinary quarter with double-digit growth, driven by a rich product portfolio and the success of its IP-driven strategy. Going into the second half of the year, we will have an important holiday season and we look forward to meeting the expected growth in consumer demand."