MATTEL INC /DE/

Previous wording

Mattel is the owner of a portfolio of iconic brands and partners with global entertainment companies to license other IP. Mattel's portfolio of owned and licensed brands and products are organized into the following categories:

Current wording

Mattel is the owner of a portfolio of iconic brands and partners with global entertainment companies to license other IP. Mattel's portfolio of owned and partner brands and products are organized into the following categories:

Previous wording

Dolls—including brands such as Barbie, American Girl, Disney Princess, Disney Frozen, Monster High, Polly Pocket, and KPop Demon Hunters. Mattel's Dolls portfolio is driven by the flagship Barbie brand and a collection of complementary brands offered globally. Empowering girls since 1959, Barbie has inspired the limitless potential in every girl, sparking imaginations and shaping futures through play. Monster High, a character-driven franchise, engages fans of all ages, encouraging them to be their authentic selves and celebrate what makes them unique. American Girl, with an extensive portfolio of dolls and accessories, content, and lifestyle products, is best known for imparting valuable life lessons that instill confidence through its inspiring dolls and books, featuring characters from past and present.

Current wording

Dolls—including owned brands such as Barbie, American Girl, Monster High, and Polly Pocket, and partner brands such as Disney Princess, Disney Frozen, and KPop Demon Hunters (Netflix). Mattel's Dolls portfolio is driven by the flagship Barbie brand and a collection of complementary brands offered globally. Empowering girls since 1959, Barbie has inspired the limitless potential in every girl, sparking imaginations and shaping futures through play. Monster High, a character-driven franchise, engages fans of all ages, encouraging them to be their authentic selves and celebrate what makes them unique. American Girl, with an extensive portfolio of dolls and accessories, content, and lifestyle products, is best known for imparting valuable life lessons that instill confidence through its inspiring dolls and books, featuring characters from past and present.

Previous wording

Vehicles—including brands such as Hot Wheels(including Hot Wheels Monster Trucksand Hot Wheels RC), Matchbox, and Cars (Disney Pixar). Hot Wheels has continued to push the limits of performance and design since 1968, and ignites and nurtures the challenger spirit in kids, adults, and collectors. From die-cast vehicles to tracks, playsets, and accessories, the Mattel Vehicles portfolio has broad appeal that engages and excites fans of all ages.

Current wording

Vehicles—including owned brands such as Hot Wheels(including Hot Wheels Monster Trucksand Hot Wheels RC) and Matchbox, and partner brands such as Cars (Disney Pixar). Hot Wheels has continued to push the limits of performance and design since 1968, and ignites and nurtures the challenger spirit in kids, adults, and collectors. From die-cast vehicles to tracks, playsets, and accessories, the Mattel Vehicles portfolio has broad appeal that engages and excites fans of all ages.

Previous wording

Action Figures, Building Sets, Games, and Other—including brands such as Masters of the Universe, Mattel Brick Shop, MEGA, UNO, Jurassic World (NBCUniversal), Minecraft (Microsoft), WWE, Toy Story (Disney Pixar), and Star Wars (Disney's Lucasfilm). Mattel's Action Figures portfolio is comprised of product lines associated with licensed entertainment franchises, such as Jurassic World and WWE, as well as product lines from Mattel-owned IP, such as Masters of the Universe. Introduced in 2025 as a new challenger brand in Building Sets, Mattel Brick Shop is designed to introduce differentiated building experiences through innovative features, materials, and techniques intended to expand traditional building play. Within Games, UNO is the classic matching card game that is easy to learn and fast fun for everyone, while the rest of the portfolio includes beloved heritage games such as Pictionary, Skip-Bo, Phase 10, and Blokus. Other includes Plush, which contains products associated with movie releases from licensed entertainment franchises such as Minecraft, as well as Mattel-owned IP.

Current wording

Action Figures, Building Sets, Games, and Other—including owned brands such as Masters of the Universe, Mattel Brick Shop, MEGA, UNO, and partner brands such as Jurassic World (NBCUniversal), Minecraft (Microsoft), WWE, Toy Story (Disney Pixar), and Star Wars (Disney's Lucasfilm). Mattel's Action Figures portfolio is comprised of product lines associated with licensed entertainment franchises, such as Jurassic World and WWE, as well as product lines from Mattel-owned IP, such as Masters of the Universe. Introduced in 2025 as a new challenger brand in Building Sets, Mattel Brick Shop is designed to introduce differentiated building experiences through innovative features, materials, and techniques intended to expand traditional building play. Within Games, UNO is the classic matching card game that is easy to learn and fast fun for everyone, while the rest of the portfolio includes beloved heritage games such as Pictionary, Skip-Bo, Phase 10, and Blokus. Games also includes digital games, including games developed and published by Mattel163, Mattel’s wholly owned mobile games studio. Other includes Plush, which contains products associated with movie releases from licensed entertainment franchises such as Minecraft, as well as Mattel-owned IP.

Previous wording

Mattel's net sales in the first quarter of 2026 increased 4% compared to the first quarter of 2025. Gross margin declined to 44.9% in the first quarter of 2026 compared to 49.4% in the first quarter of 2025, due to the gross incremental cost of tariffs, unfavorable foreign exchange, and inflation. Gross margin benefited from mitigating actions to offset tariffs and realized savings from the Optimizing for Profitable Growth program (the "OPG program"), partially offset by other factors.

Current wording

Mattel's net sales in the second quarter of 2026 increased 10% compared to the second quarter of 2025. Gross margin declined to 48.2% in the second quarter of 2026 compared to 50.9% in the second quarter of 2025, due to the gross incremental cost of tariffs, inflation, higher royalties, and the unfavorable impact of foreign exchange. Gross margin benefited from Mattel163's contribution and other factors, including mitigating actions to offset tariffs and realized savings from the Optimizing for Profitable Growth program (the "OPG program").

Previous wording

Global trade policy continues to evolve and the ultimate impact of recent developments with respect to U.S. tariffs is unclear. On February 20, 2026, the U.S. Supreme Court issued a ruling that tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") on goods imported into the United States were unauthorized. Following that ruling, the U.S. Court of International Trade issued an order directing the U.S. Customs and Border Protection ("CBP") to process refunds of the IEEPA tariffs, although the Court immediately suspended the order while CBP develops and implements the refund process. The IEEPA tariffs and related refund framework remain subject to ongoing litigation, including potential appeals, as well as regulatory and administrative developments. Accordingly, the ultimate availability, timing, and amount of any potential refunds of such tariffs remain highly uncertain. Following the Supreme Court’s decision, the U.S. presidential administration announced its intention to invoke other laws to collect tariffs and announced new tariffs on imports from all countries, in addition to any existing non-IEEPA tariffs. There remains substantial uncertainty regarding the duration of various existing and newly announced or intended tariffs, potential changes or pauses to such tariffs, tariff levels, and whether further additional tariffs or other retaliatory actions may be imposed, modified, suspended, or invalidated, and the impacts of such actions on Mattel's business. Mattel continues to monitor and evaluate these developments and assess their potential impact on Mattel’s business, financial condition, and results of operations.

Current wording

Global trade policy continues to evolve and the ultimate impact of recent developments with respect to U.S. tariffs is unclear. In February 2026, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") on goods imported into the United States were unauthorized and subsequently a refund process was implemented, which was appealed and is subject to ongoing litigation, as well as refund process developments. Following the U.S. Supreme Court's decision on IEEPA tariffs, the U.S. presidential administration (the "Administration") imposed temporary global tariffs on imports under Section 122 of the Trade Act of 1974 ("Section 122"), which expired on July 24, 2026. These Section 122 tariffs are currently subject to legal challenge and in May 2026, the CIT issued a ruling that the Section 122 tariffs are unauthorized by the statute, although this ruling is currently stayed pending appeal. Accordingly, the ultimate availability, timing, and amount of potential tariff refunds remain uncertain. During the three months ended June 30, 2026, Mattel received certain refunds under the IEEPA tariff refund process, which were not material. As of June 30, 2026, Mattel had not recognized a receivable related to additional tariff refunds because they were not realized or realizable. However, it is reasonably possible that the impact of tariff refunds could be material. In July 2026, the Administration imposed additional tariffs under Section 301 of the Trade Act of 1974. These Section 301 tariffs are currently subject to legal challenge. There remains substantial uncertainty regarding the duration of various existing and newly announced or intended tariffs, potential changes or pauses to such tariffs, tariff levels, and whether further additional tariffs or other retaliatory actions may be imposed, modified, suspended, or invalidated, and the impacts of such actions on Mattel's business. Mattel continues to monitor and evaluate these developments and assess their potential impact on Mattel's business, financial condition, and results of operations.

Previous wording

The following table presents Mattel's consolidated results for the first quarter of 2026 and 2025:

Current wording

The following table presents Mattel's consolidated results for the second quarter of 2026 and 2025:

Previous wording

Gross billings represent amounts invoiced to a customer and do not include the impact of sales adjustments, such as trade discounts and other allowances. Changes in gross billings are discussed below because, while Mattel records the details of sales adjustments in its financial accounting systems at the time of sale, such sales adjustments are generally recorded by customer and are not associated with categories, brands, or individual products. The following tables provide a summary of Mattel's consolidated gross billings by categories, along with supplemental information by brand, for the first quarter of 2026 and 2025:

Current wording

Gross billings represent amounts invoiced to a customer and do not include the impact of sales adjustments, such as trade discounts and other allowances. Changes in gross billings are discussed below because, while Mattel records the details of sales adjustments in its financial accounting systems at the time of sale, such sales adjustments are generally recorded by customer and are not associated with categories, brands, or individual products. The following tables provide a summary of Mattel's consolidated gross billings by categories, along with supplemental information by brand, for the second quarter of 2026 and 2025:

Previous wording

Sales adjustments generally represent arrangements with Mattel's customers to provide sales incentives, support customer promotions, and provide allowances for returns and defective merchandise. Such programs are based primarily on customer purchases, customer performance of specified promotional activities, and other specified factors such as sales to consumers. Additionally, sales adjustments may include foreign currency transaction gains and losses from the remeasurement of accounts receivable denominated in currencies that are different from the relevant entity's functional currency. Sales adjustments increased to $109.7 million in the first quarter of 2026 from $97.5 million in the first quarter of 2025. Sales adjustments as a percentage of net sales increased to 12.7% in the first quarter of 2026, as compared to 11.8% in the first quarter of 2025, primarily due to a higher proportion of sales occurring in regions with higher average sales rates and a shift in sales channel mix resulting in a higher proportion of sales with higher average sales adjustment rates.

Current wording

Sales adjustments generally represent arrangements with Mattel's customers to provide sales incentives, support customer promotions, and provide allowances for returns and defective merchandise. Such programs are based primarily on customer purchases, customer performance of specified promotional activities, and other specified factors such as sales to consumers. Additionally, sales adjustments may include foreign currency transaction gains and losses from the remeasurement of accounts receivable denominated in currencies that are different from the relevant entity's functional currency. Sales adjustments increased to $141.5 million in the second quarter of 2026 from $131.9 million in the second quarter of 2025. Sales adjustments as a percentage of net sales were relatively consistent at 12.6% in the second quarter of 2026, as compared to 12.9% in the second quarter of 2025.

Previous wording

Cost of sales increased by $56.9 million, or 14%, to $475.4 million in the first quarter of 2026 from $418.5 million in the first quarter of 2025. Within cost of sales, product and other costs increased by $42.7 million, or 14%, to $353.0 million in the first quarter of 2026 from $310.3 million in the first quarter of 2025. Royalty expense increased by $7.8 million, or 18%, to $50.4 million in the first quarter of 2026 from $42.5 million in the first quarter of 2025. Freight and logistics expenses increased by $6.4 million, or 10%, to $72.1 million in the first quarter of 2026, as compared to $65.7 million in the first quarter of 2025.

Current wording

Cost of sales increased by $83.6 million, or 17%, to $583.2 million in the second quarter of 2026 from $499.6 million in the second quarter of 2025. Within cost of sales, product and other costs increased by $60.6 million, or 16%, to $437.5 million in the second quarter of 2026 from $376.9 million in the second quarter of 2025. Royalty expense increased by $15.6 million, or 31%, to $66.8 million in the second quarter of 2026 from $51.2 million in the second quarter of 2025. Freight and logistics expenses increased by $7.4 million, or 10%, to $78.9 million in the second quarter of 2026, as compared to $71.5 million in the second quarter of 2025.

Previous wording

Advertising and promotion expenses primarily consist of: (i) media costs, which include the media, planning, and buying fees for television, print, and online advertisements, (ii) non-media costs, which include commercial and website production, merchandising, and promotional costs, (iii) retail advertising costs, which include consumer direct catalogs, and (iv) general advertising costs, which include trade show costs. Advertising and promotion expenses as a percentage of net sales increased to 10.8% in the first quarter of 2026, as compared to 8.5% in the first quarter of 2025. The increase in advertising and promotion expenses as a percentage of net sales was primarily due to increased advertising and promotion programs and the timing of holiday activations in the first quarter of 2026 compared to the first quarter of 2025.

Current wording

Advertising and promotion expenses primarily consist of: (i) media costs, which include the media, planning, and buying fees for television, print, and online advertisements, (ii) non-media costs, which include commercial and website production, merchandising, and promotional costs, (iii) retail advertising costs, which include consumer direct catalogs, and (iv) general advertising costs, which include trade show costs. Advertising and promotion expenses as a percentage of net sales increased to 11.0% in the second quarter of 2026, as compared to 7.8% in the second quarter of 2025. The increase in advertising and promotion expenses as a percentage of net sales was primarily due to expenses associated with Mattel163, promotional activities for theatrical releases, and investments in brand, marketing, and consumer engagement activities during the quarter.

Previous wording

Interest income decreased by $5.3 million to $10.7 million in the first quarter of 2026 from $16.0 million in the first quarter of 2025. The decrease was primarily due to lower average invested cash balances in the first quarter of 2026.

Current wording

Interest income decreased by $5.3 million to $7.0 million in the second quarter of 2026 from $12.4 million in the second quarter of 2025. The decrease was primarily due to lower average invested cash balances in the second quarter of 2026.

Previous wording

Evaluating the need for and the amount of a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence to determine whether it is more-likely-than-not that these assets will be realizable. Mattel routinely assesses the positive and negative evidence for this realizability, including the evaluation of sustained profitability and three years of cumulative pretax income for each tax jurisdiction. For the three months ended March 31, 2026, there were no material changes to Mattel's valuation allowance.

Current wording

Evaluating the need for and the amount of a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence to determine whether it is more-likely-than-not that these assets will be realizable. Mattel routinely assesses the positive and negative evidence for this realizability, including the evaluation of sustained profitability and three years of cumulative pretax income for each tax jurisdiction. For the second quarter of 2026 and 2025, there were no material changes to Mattel's valuation allowance.

Previous wording

Gross billings for the North America segment were $508.5 million in the first quarter of 2026, a decrease of $17.5 million, or 3%, as compared to $526.0 million in the first quarter of 2025. The decrease in the North America segment gross billings was due to lower billings of Infant, Toddler, and Preschool and Dolls products, partially offset by higher billings of Action Figures, Building Sets, Games, and Other and Vehicles products.

Current wording

Gross billings for the North America segment were $613.3 million in the second quarter of 2026, an increase of $65.8 million, or 12%, as compared to $547.5 million in the second quarter of 2025. The increase in the North America segment gross billings was due to higher billings of Action Figures, Building Sets, Games, and Other, Vehicles, and Dolls, partially offset by lower billings of Infant, Toddler, and Preschool.

Previous wording

Vehicles gross billings increased 7%, primarily due to higher billings of Hot Wheels products.

Current wording

Vehicles gross billings increased 7%, primarily due to higher billings of Hot Wheels.

Previous wording

North America segment income was $34.5 million in the first quarter of 2026, as compared to $83.1 million in the first quarter of 2025, due to lower net sales of $16.2 million, higher other selling and administrative expenses of $12.2 million, higher cost of sales of $10.3 million, and higher advertising and promotion expenses of $9.9 million.

Current wording

North America segment income was $92.0 million in the second quarter of 2026, as compared to $93.8 million in the second quarter of 2025, primarily due to higher cost of sales of $38.9 million and higher advertising and promotion expenses of $22.6 million, partially offset by higher net sales of $63.5 million.

Previous wording

Gross billings for the International segment were $463.4 million in the first quarter of 2026, an increase of $65.2 million, or 16%, as compared to $398.2 million in the first quarter of 2025, with a favorable impact from changes in currency exchange rates of eight percentage points. The increase in the International segment gross billings was due to higher billings of Vehicles and Action Figures, Building Sets, Games, and Other products, partially offset by lower billings of Dolls products.

Current wording

Gross billings for the International segment were $653.6 million in the second quarter of 2026, an increase of $50.6 million, or 8%, as compared to $602.9 million in the second quarter of 2025, with a favorable impact from changes in currency exchange rates of four percentage points. The increase in the International segment gross billings was due to higher billings of Vehicles and Action Figures, Building Sets, Games, and Other, partially offset by lower billings of Dolls and Infant, Toddler, and Preschool.

Previous wording

International segment income decreased to $19.9 million in the first quarter of 2026 from $23.3 million in the first quarter of 2025, primarily due to higher cost of sales of $27.2 million, higher other selling and administrative expenses of $15.2 million, and higher advertising and promotion expenses of $12.8 million, partially offset by higher net sales of $51.8 million.

Current wording

International segment income decreased to $81.9 million in the second quarter of 2026 from $114.9 million in the second quarter of 2025, primarily due to higher cost of sales of $29.4 million, higher other selling and administrative expenses of $24.3 million, and higher advertising and promotion expenses of $22.6 million, partially offset by higher net sales of $43.3 million.

Previous wording

Gross billings were $971.9 million in the first quarter of 2026, an increase of $47.7 million, or 5%, as compared to $924.2 million in the first quarter of 2025, with a favorable impact from changes in currency exchange rates of three percentage points. The increase in gross billings was primarily due to higher billings of Vehicles and Action Figures, Building Sets, Games, and Other products, partially offset by lower billings of Dolls and Infant, Toddler, and Preschool products.

Current wording

Gross billings were $2.24 billion in the first half of 2026, an increase of $164.1 million, or 8%, as compared to $2.07 billion in the first half of 2025, with a favorable impact from changes in currency exchange rates of three percentage points. The increase in gross billings was primarily due to higher billings of Action Figures, Building Sets, Games, and Other and Vehicles, partially offset by lower billings of Dolls and Infant, Toddler, and Preschool.

Previous wording

Gross margin decreased to 44.9% in the first quarter of 2026 from 49.4% in the first quarter of 2025. The decrease in gross margin was primarily due to gross incremental tariff costs of 240 basis points, unfavorable impact from foreign currency exchange of 140 basis points, and cost inflation of 90 basis points. Gross margin benefited by 20 basis points from mitigating actions to offset tariffs and realized savings from the OPG program, partially offset by other factors.

Current wording

Gross margin decreased to 46.7% in the first half of 2026 from 50.2% in the first half of 2025. The decrease in gross margin was primarily due to gross incremental tariff costs of 200 basis points, cost inflation of 110 basis points, higher royalty expense of 100 basis points, and an unfavorable impact from foreign currency exchange of 100 basis points. Gross margin benefited from Mattel163's contribution of 90 basis points, and other factors including mitigating actions to offset tariffs, and realized savings from the OPG program, of 70 basis points.

Previous wording

Other selling and administrative expenses were $396.6 million, or 46.0% of net sales, in the first quarter of 2026, an increase of $5.7 million, as compared to $390.9 million, or 47.3% of net sales, in the first quarter of 2025. The increase in other selling and administrative expenses was primarily due to expenses incurred in connection with the acquisition of Mattel163 of approximately $9 million, and higher investments and other expenses of $27.7 million, partially offset by lower expenses related to inclined sleeper product recalls and related litigation of $18.3 million, realized savings from the OPG program of $13.2 million, and lower severance and restructuring charges of $4.9 million.

Current wording

Other selling and administrative expenses were $803.5 million, or 40.4% of net sales, in the first half of 2026, an increase of $51.3 million, as compared to $752.2 million, or 40.8% of net sales, in the first half of 2025. The increase in other selling and administrative expenses was primarily due to higher investments of $35.9 million, unfavorable impact from foreign currency exchange of $9.0 million, and higher expenses associated with Mattel163, including acquisition-related expenses, and other expenses of $43.9 million, partially offset by realized savings from the OPG program of $22.1 million and lower expenses related to inclined sleeper product recalls and related litigation of $17.7 million.

Previous wording

Other non-operating income increased by $161.1 million to $148.1 million in the first quarter of 2026 from an expense of $13.0 million in the first quarter of 2025, primarily driven by the gain recognized on Mattel's previously held equity interest in Mattel163. On March 2, 2026, Mattel acquired the remaining 50% equity interest in Mattel163. Prior to the acquisition of the remaining 50% equity interest in Mattel163, Mattel accounted for its investment under the equity method. Upon obtaining control, Mattel remeasured its previously held 50% equity interest to its estimated fair value as of the Acquisition Date, resulting in a gain of $147.9 million recognized in the first quarter of 2026.

Current wording

Other non-operating income increased by $155.6 million to $144.0 million in the first half of 2026 from an expense of $11.6 million in the first half of 2025, primarily due to the gain recognized on Mattel's previously held equity interest in Mattel163. On March 2, 2026, Mattel acquired the remaining 50% equity interest in Mattel163. Prior to the acquisition of the remaining 50% equity interest in Mattel163, Mattel accounted for its investment under the equity method. Upon obtaining control, Mattel remeasured its previously held 50% equity interest to its estimated fair value as of the Acquisition Date, resulting in a gain of $147.9 million recognized in the first half of 2026.

Previous wording

Mattel's benefit from income taxes was $32.5 million for the three months ended March 31, 2026, compared to $30.6 million for the three months ended March 31, 2025. The increase in benefit from income taxes was driven by a higher net loss from continuing operations before income taxes excluding the impact of the gain recognized on the acquisition of Mattel163, partially offset by lower net discrete income tax benefits in the first quarter of 2026. Mattel recognized a net discrete income tax benefit of $4.6 million during the three months ended March 31, 2026, primarily related to previously unrecognized tax benefits, partially offset by a discrete tax expense related to the acquisition of Mattel163. Mattel recognized a net discrete tax benefit of $11.4 million during the three months ended March 31, 2025, primarily related to a change of its indefinite reinvestment assertion relating to certain foreign subsidiary earnings.

Current wording

Mattel's benefit from income taxes was $32.2 million for the first half of 2026, as compared to $14.4 million for the first half of 2025. The increase in benefit from income taxes was primarily due to a higher net loss from continuing operations before income taxes excluding the impact of the gain recognized on the acquisition of Mattel163, partially offset by higher net discrete income tax expense for the first half of 2026. During the first half of 2026, Mattel’s discrete income tax items had no net impact, with discrete income tax expense related to interest accrued on previously unrecognized tax benefits and the acquisition of Mattel163 being largely offset by a discrete income tax benefit related to previously unrecognized tax benefits. During the first half of 2025, Mattel recognized a net discrete income tax benefit of $10.4 million, primarily related to a change of its indefinite reinvestment assertion relating to certain foreign subsidiary earnings.

Previous wording

Infant, Toddler, and Preschool gross billings decreased 16%, of which 8% was due to lower billings of Fisher-Price products, 5% was due to lower billings of Preschool Entertainment products, and 2% was due to lower billings of Baby Gear and Power Wheels products, due to the continued strategic exit from certain product lines in Baby Gear and Power Wheels.

Current wording

Infant, Toddler, and Preschool gross billings decreased 17%, of which 8% was due to lower billings of Fisher-Price, 6% was due to lower billings of Preschool Entertainment, and 3% was due to lower billings of Baby Gear and Power Wheels, due to the continued strategic exit from certain product lines in Baby Gear and Power Wheels.

Previous wording

Action Figures, Building Sets, Games, and Other gross billings increased 42%, of which 19% was due to higher billings of Games products, which benefitted from the partial quarter contribution from Mattel163, 16% was due to higher billings of Action Figures products, and 7% was due to higher billings of Building Sets products.

Current wording

Action Figures, Building Sets, Games, and Other gross billings increased 24%, of which 19% was due to higher billings of Games, which benefited from Mattel163's contribution, and 5% was due to higher billings of Action Figures, which benefited from the timing of theatrical releases.

Previous wording

On February 7, 2024, Mattel announced the OPG program, a multi-year cost savings program that follows the OFG program, which concluded in the fourth quarter of 2023. The OPG program is designed to achieve further efficiency and cost savings opportunities, primarily within Mattel's global supply chain, including its manufacturing footprint. The OPG program includes cost savings actions in connection with discontinuing production at a plant in China, as previously announced in the third quarter of 2023, as well as savings from other previous actions taken in 2023 that were not recognized in the OFG program. Targeted annual gross cost savings from actions associated with the OPG program, which are expected to be completed by the end of 2026, were increased from $200 million to $225 million in the fourth quarter of 2025. Of the $225 million in targeted annual gross costs savings, approximately 60% is expected to benefit cost of sales and 40% is expected to benefit other selling and administrative expenses. Total cash expenditures under the OPG program are expected to be up to approximately $140 million and total non-cash charges are expected to be approximately $5 million.

Current wording

On February 7, 2024, Mattel announced the OPG program, a multi-year cost savings program that follows the OFG program, which concluded in the fourth quarter of 2023. The OPG program is designed to achieve further efficiency and cost savings opportunities, primarily within Mattel's global supply chain, including its manufacturing footprint. The OPG program includes cost savings actions in connection with discontinuing production at a plant in China, as previously announced in the third quarter of 2023, as well as savings from other previous actions taken in 2023 that were not recognized in the OFG program. Targeted annual gross cost savings from actions associated with the OPG program, which are expected to be completed by the end of 2026, were increased from $200 million to $225 million in the fourth quarter of 2025. Of the $225 million in targeted annual gross cost savings, approximately 55% is expected to benefit cost of sales and 45% is expected to benefit other selling and administrative expenses. Total cash expenditures under the OPG program are expected to be up to approximately $140 million, and total non-cash charges are expected to be approximately $5 million.

Previous wording

As of March 31, 2026, in connection with the OPG program, Mattel recorded cumulative severance and other restructuring charges of approximately $132 million, which included approximately $5 million of non-cash charges. Mattel realized cumulative cost savings (before severance, restructuring costs, and cost inflation) of approximately $189 million, which represents approximately 55% benefit to cost of sales, and approximately 45% benefit to other selling and administrative expenses, as of March 31, 2026, in connection with the OPG program.

Current wording

As of June 30, 2026, in connection with the OPG program, Mattel recorded cumulative severance and other restructuring charges of approximately $134 million, which included approximately $5 million of non-cash charges. Mattel realized cumulative cost savings (before severance, restructuring costs, and cost inflation) of approximately $205 million, which represents approximately 55% benefit to cost of sales, and approximately 45% benefit to other selling and administrative expenses, as of June 30, 2026, in connection with the OPG program.

Previous wording

Mattel's primary sources of liquidity are its domestic and foreign cash and equivalents balances, driven by cash flows from operating activities, short-term borrowing facilities, including its $1.40 billion in aggregate principal amount of senior unsecured revolving credit facilities (the "Credit Facility"), and access to capital markets to fund its operations and obligations. Such obligations may include capital expenditures, debt service, future royalty payments pursuant to licensing agreements, future inventory and service purchases, and required cash contributions and payments related to benefit plans. Of Mattel's $866.0 million in cash and equivalents at March 31, 2026, $652.8 million was held by foreign subsidiaries, including $72.3 million held in Russia. Mattel's cash held in Russia can be used within the country; however, its movement out of Russia is currently limited. In early 2022, Mattel paused all shipments into Russia.

Current wording

Mattel's primary sources of liquidity are its domestic and foreign cash and equivalents balances, due to cash flows from operating activities, short-term borrowing facilities, including its $1.40 billion in aggregate principal amount of senior unsecured revolving credit facilities (the "Credit Facility"), and access to capital markets to fund its operations and obligations. Such obligations may include capital expenditures, debt service, future royalty payments pursuant to licensing agreements, future inventory and service purchases, and required cash contributions and payments related to benefit plans. Of Mattel's $523.9 million in cash and equivalents at June 30, 2026, $393.0 million was held by foreign subsidiaries, including $75.5 million held in Russia. Mattel's cash held in Russia can be used within the country; however, its movement out of Russia is currently limited. In 2022, Mattel paused all shipments into Russia.

Previous wording

Cash flows used for operating activities were $22.9 million in the first three months of 2026, as compared to cash flows provided by operating activities of $24.8 million in the first three months of 2025. The increase in cash flows used for operating activities was primarily due to a decrease in net income, excluding the impact of non-cash items, partially offset by a decrease in cash used for working capital of $11.3 million.

Current wording

Cash flows used for operating activities were $202.1 million in the first half of 2026, as compared to $275.3 million in the first half of 2025. The decrease in cash flows used for operating activities was primarily due to a decrease in cash used for working capital of $206.6 million, partially offset by a decrease in net income, excluding the impact of non-cash items.

Previous wording

Cash flows used for investing activities were $143.6 million in the first three months of 2026, as compared to $31.3 million in the first three months of 2025. The increase in cash flows used for investing activities was primarily due to $74.8 million cash paid for the remaining 50% interest in Mattel163, net of cash acquired, and an increase in capital expenditures of $28.9 million.

Current wording

Cash flows used for investing activities were $195.3 million in the first half of 2026, as compared to $54.6 million in the first half of 2025. The increase in cash flows used for investing activities was primarily due to $74.8 million of cash paid for the remaining 50% interest in Mattel163, net of cash acquired, and an increase in capital expenditures of $49.8 million.

Previous wording

Cash flows used for financing activities were $208.3 million in the first three months of 2026, as compared to $161.9 million in the first three months of 2025. The increase in cash flows used for financing activities was primarily due to $40.0 million of increased share repurchases in the first three months of 2026 as compared to the first three months of 2025.

Current wording

Cash flows used for financing activities were $323.0 million in the first half of 2026, as compared to $222.4 million in the first half of 2025. The increase in cash flows used for financing activities was primarily due to an increase of $90.0 million of cash paid for share repurchases in the first half of 2026 as compared to the first half of 2025.

Previous wording

Mattel's cash and equivalents decreased by $376.9 million to $866.0 million at March 31, 2026 from $1.24 billion at December 31, 2025, primarily due to share repurchases of $200.0 million, $74.8 million of cash paid for the remaining 50% equity interest in Mattel163, net of cash acquired, and capital expenditures of $65.1 million during the three months ended March 31, 2026. Mattel's cash and equivalents decreased by $377.7 million to $866.0 million at March 31, 2026 from $1.24 billion at March 31, 2025, primarily due to share repurchases of $640.0 million, capital expenditures of $210.9 million, and $74.8 million of cash paid for the remaining 50% equity interest in Mattel163, net of cash acquired, during the trailing twelve months ended March 31, 2026, partially offset by cash flows provided by operating activities of $545.5 million during that twelve-month period.

Current wording

Mattel's cash and equivalents decreased by $719.1 million to $523.9 million at June 30, 2026 from $1.24 billion at December 31, 2025. The decrease during the six months ended June 30, 2026 was primarily due to cash paid for share repurchases of $300.0 million, cash flows used for operating activities of $202.1 million, capital expenditures of $125.8 million, and $74.8 million of cash paid for the remaining 50% equity interest in Mattel163, net of cash acquired. Mattel's cash and equivalents decreased by $346.6 million to $523.9 million at June 30, 2026 from $870.5 million at June 30, 2025. The decrease during the trailing twelve months was primarily due to cash paid for share repurchases of $690.0 million, capital expenditures of $231.8 million, and $74.8 million of cash paid for the remaining 50% equity interest in Mattel163, net of cash acquired, partially offset by cash flows provided by operating activities of $666.4 million.

Previous wording

Accounts receivable decreased by $410.9 million to $686.7 million at March 31, 2026 from $1.10 billion at December 31, 2025, primarily due to seasonal declines as year-end receivables are collected. Accounts receivable increased by $53.4 million to $686.7 million at March 31, 2026 from $633.3 million at March 31, 2025, primarily due to higher net sales and the timing of collections.

Current wording

Accounts receivable decreased by $277.3 million to $820.3 million at June 30, 2026 from $1.10 billion at December 31, 2025, primarily due to seasonal declines as year-end receivables are collected. Accounts receivable increased by $27.8 million to $820.3 million at June 30, 2026 from $792.5 million at June 30, 2025, primarily due to higher net sales and the timing of collections.

Previous wording

Inventories increased by $113.7 million to $676.9 million at March 31, 2026 from $563.1 million at December 31, 2025, primarily due to seasonal inventory build-up. Inventories increased by $18.5 million to $676.9 million at March 31, 2026 from $658.4 million at March 31, 2025, primarily due to tariff related impacts in the United States, partially offset by higher net sales in the first quarter of 2026 and the impact of foreign currency translation.

Current wording

Inventories increased by $266.7 million to $829.8 million at June 30, 2026 from $563.1 million at December 31, 2025, primarily due to seasonal inventory build-up. Inventories decreased by $38.1 million to $829.8 million at June 30, 2026 from $867.9 million at June 30, 2025, primarily due to higher net sales in the second quarter of 2026 and the impact of foreign currency translation.

Previous wording

Prepaid expenses and other current assets increased by $35.4 million to $262.5 million at March 31, 2026 from $227.1 million at December 31, 2025, primarily due to increases in prepaid income taxes of $37.1 million. Prepaid expenses and other current assets increased by $11.4 million to $262.5 million at March 31, 2026 from $251.1 million at March 31, 2025, primarily due to increases in prepaid income taxes of $30.3 million, partially offset by a decrease in prepaid insurance of $6.2 million.

Current wording

Prepaid expenses and other current assets increased by $52.3 million to $279.5 million at June 30, 2026 from $227.1 million at December 31, 2025, primarily due to an increase in income taxes receivable of $44.0 million. Prepaid expenses and other current assets increased by $11.3 million to $279.5 million at June 30, 2026 from $268.2 million at June 30, 2025, primarily due to increases in prepaid income taxes of $36.5 million, partially offset by a decrease in prepaid royalty of $10.2 million.

Previous wording

Accounts payable and accrued liabilities decreased by $234.0 million to $1.19 billion at March 31, 2026 from $1.43 billion at December 31, 2025, primarily due to a decrease in accounts payable of $182.2 million, a decrease in accrued royalties of $52.2 million, a decrease in accrued advertising expenses of $42.8 million, and a decrease in taxes other than income taxes of $32.6 million, partially offset by higher deferred income of $57.3 million and higher interest payable of $29.9 million. Accounts payable and accrued liabilities increased by $62.6 million to $1.19 billion at March 31, 2026 from $1.13 billion at March 31, 2025, primarily due to higher deferred income of $63.8 million and an increase in accounts payable of $54.9 million, partially offset by lower accrued incentive compensation of $56.7 million.

Current wording

Accounts payable and accrued liabilities decreased by $145.6 million to $1.28 billion at June 30, 2026 from $1.43 billion at December 31, 2025, primarily due to a decrease in accounts payable of $107.4 million, lower accrued incentive compensation of $35.1 million, a decrease in taxes other than income taxes of $26.3 million, a decrease in accrued royalties of $19.7 million, and a decrease in accrued advertising expenses of $10.1 million, partially offset by higher deferred income of $57.8 million. Accounts payable and accrued liabilities increased by $159.8 million to $1.28 billion at June 30, 2026 from $1.12 billion at June 30, 2025, primarily due to an increase in deferred income of $59.4 million, an increase in accrued advertising expenses of $37.0 million, an increase in accounts payable of $28.6 million, and an increase in accrued royalties of $13.4 million.

Previous wording

Total debt was $2.33 billion at both March 31, 2026 and December 31, 2025, and $2.34 billion at March 31, 2025. During 2025, Mattel issued $600.0 million of 2025 Senior Notes due November 2030 and used the proceeds plus cash on hand to repay $600.0 million of 2021 Senior Notes due April 2026.

Current wording

Total debt was $2.33 billion at both June 30, 2026 and December 31, 2025, and $2.34 billion at June 30, 2025. During 2025, Mattel issued $600.0 million of 2025 Senior Notes due November 2030 and used the net proceeds plus cash on hand to repay $600.0 million of 2021 Senior Notes due April 2026.

Previous wording

Stockholders' equity decreased by $126.6 million to $2.11 billion at March 31, 2026 from $2.23 billion at December 31, 2025, primarily due to share repurchases of $201.7 million, partially offset by net income of $61.0 million during the three months ended March 31, 2026. Stockholders' equity decreased by $23.1 million to $2.11 billion at March 31, 2026 from $2.13 billion at March 31, 2025, primarily due to share repurchases of $645.7 million during the trailing twelve months ended March 31, 2026, partially offset by net income of $498.9 million and the net effect of share-based compensation and the related issuance of treasury stock of $60.1 million during that twelve-month period.

Current wording

Stockholders' equity decreased by $234.9 million to $2.00 billion at June 30, 2026 from $2.23 billion at December 31, 2025, primarily due to share repurchases of $302.5 million, partially offset by net income of $42.8 million and the net effect of share-based compensation and the related issuance of treasury stock of $12.8 million during the six months ended June 30, 2026. Stockholders' equity decreased by $173.7 million to $2.00 billion at June 30, 2026 from $2.17 billion at June 30, 2025, primarily due to the net effect of share repurchases of $696.1 million, partially offset by net income of $427.4 million, the net effect of share-based compensation and the related issuance of treasury stock of $56.7 million, and other comprehensive income of $37.0 million during that twelve-month period.

Previous wording

Mattel's critical accounting policies and estimates are included in the 2025 Annual Report on Form 10-K and did not materially change during the first three months of 2026.

Current wording

Mattel's critical accounting policies and estimates are included in the 2025 Annual Report on Form 10-K and did not materially change during the first half of 2026.

Previous wording

Mattel believes that the disclosure of the percentage impact of currency changes is useful supplemental information for investors to be able to gauge Mattel's current business performance and the longer-term strength of its overall business since currency changes could potentially mask underlying sales trends. The disclosure of the percentage impact of currency exchange allows investors to calculate the impact on a constant currency basis and also enhances their ability to compare financial results from one period to another.

Current wording

Mattel believes that the disclosure of the percentage impact of currency changes is useful supplemental information for investors to be able to gauge Mattel's current business performance and the longer-term strength of its overall business since currency changes could potentially mask underlying sales trends. The disclosure of the percentage impact of currency exchange allows investors to calculate the impact on a constant currency basis and enhances their ability to compare financial results from one period to another.