Q2 2024 Earnings Summary
Reported on Feb 18, 2025
Pre-Earnings PriceN/ADate unavailable
Post-Earnings PriceN/ADate unavailable
Price ChangeN/A
- Mattel expects its toy business to grow in the second half of 2024 and looks forward to a good holiday season, driven by new product innovation, increased retail support, more marketing and promotion, and new content as part of their franchise management strategy.
- The company has strong relationships with retail partners, allowing for increased shelf space in the second half of the year. Mattel sells products in 500,000 stores globally, which is a core strength enabling them to expand their retail footprint.
- Since the turnaround started in 2018, Mattel has shown significant financial improvements: they grew their top line by more than $0.5 billion, increased adjusted gross margin by almost 1,000 basis points, grew adjusted EBITDA by 7.5 times, improved free cash flow from negative $325 million to positive $700 million, and achieved investment-grade status.
- Mattel expects the overall toy industry to decline modestly in 2024, which could negatively impact the company's sales growth.
- Consumer product licensing revenue is expected to decrease year-over-year due to lapping strong Barbie movie-related sales from the prior year, potentially impacting earnings in the back half.
- Adjusted Selling, General, and Administrative expenses increased by $37 million due to market-related pay increases, upgrading IT systems, and hiring talent to accelerate the entertainment strategy, which may pressure margins if not offset by sufficient revenue growth.
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