Mattel's 4Q Revenue Drops as Barbie Sales Slip

Mattel 4Q Revenue Drops as Barbie sales Slip
Emmanuel Dunand, AFP/Getty Images
EL SEGUNDO, Calif. -- Mattel says it was a tough time in toyland this past holiday season.

Shares of Mattel (MAT) dropped more than 9 percent in premarket trading Thursday after the world's largest toy maker said sales of key toys like Barbie and Fisher-Price preschool items dropped in its fourth quarter.

CEO Bryan Stockton called 2013 a "challenging and transformative year at retail."

Toy makers count on the November and December holiday season to make 40 percent or more of annual revenue. But traditional toy makers are struggling as kids turn more toward electronic devices and video games.

While fourth-quarter net income climbed 21 percent from year-ago results depressed by a litigation charge, its quarterly performance missed both analyst estimates and the company's own expectations.

For the three months ended Dec. 31, Mattel earned $369.2 million, or $1.07 a share.

That compares with $306.5 million, or 87 cents a share, a year ago. The prior-year period included an $87.1 million litigation charge.

Analysts surveyed by FactSet expected earnings of $1.19 a share.

Revenue dropped 7 percent to $2.11 billion from $2.26 billion. Analysts expected $2.37 billion.

Barbie and Fisher-Price sales both declined 13 percent. Sales for Hot Wheels fell 8 percent. One bright spot was American Girl, which reported a 3 percent sales increase. Mattel said the performance was mostly helped by sales of the 2013 Girl of the Year, Saige.

CEO Stockton said weakness was mostly in the U.S. and the El Segundo, Calif.-based toy maker is continuing to invest in emerging markets like China and Russia.

Mattel's full-year net income increased to $903.9 million, or $2.58 a share, from $776.5 million, or $2.22 a share, in the previous year.

Annual revenue edged up 1 percent to $6.48 billion from $6.42 billion.

Shares fell $4.11, or 9.6 percent to $38.90 in premarket trading about an hour ahead of the market open. The stock has fallen 10 percent so far this year.

Learn about investing from the comfort of your own home.

Portfolio Basics

Take the first steps to building your portfolio.

View Course »

Investment Strategies

Learn the strategies you need to build a winning portfolio

View Course »

Add a Comment

*0 / 3000 Character Maximum

3 Comments

Filter by:
abtvjt

Some parents let small children play with electronics so much that why play make believe?The world and people are changing,sometimes not in a good way.

February 01 2014 at 1:35 PM Report abuse -1 rate up rate down Reply
lthrnck68

This how long after they changed Barbie in order to please groups boycotting the old style Barbie?

February 01 2014 at 1:35 PM Report abuse rate up rate down Reply
rudniski136

Maybe there just aren't as many kids to buy for any more. The populations of all the schools around my area have dropped. Fewer young children, fewer toy purchases of this type.

February 01 2014 at 7:15 AM Report abuse rate up rate down Reply
rgkarasiewicz

What did Mattel expect was going to happen when they decided to make their toys abroad?

January 31 2014 at 10:13 AM Report abuse +1 rate up rate down Reply