SAN JOSE (California), Aug 4 (Bernama-dpa) -- Despite higher sales, Mattel posted a second-quarter loss, the US toymaker said on Tuesday, reported German news agency dpa.
The company reported a loss in the second quarter, compared to a profit last year, as higher advertising, selling and administrative expenses, along with tariff-related costs and inflation, offset the benefit of higher sales.
The toymaker posted a net loss of US$18.2 million or US$0.06 per share for the second quarter, compared with net income of US$53.4 million or US$0.16 per share in the prior-year period. Adjusted earnings were US$0.01 per share, down from US$0.21 per share a year ago.
Net sales increased 10 per cent to US$1.125 billion from US$1.019 billion last year, driven by 12 per cent growth in North America and 9 per cent growth internationally. On a constant-currency basis, sales rose 9 per cent.
Reported gross margin declined to 48.2 per cent from 50.9 per cent, reflecting the impact of tariffs, inflation, higher royalties and unfavourable foreign exchange, partly offset by cost savings and tariff mitigation actions.
For the quarter, worldwide gross billings in vehicles climbed 14 per cent, led by Hot Wheels, while action figures, building sets, games and other surged 35 per cent, supported by digital games and theatrical releases. Dolls billings declined 5 per cent, primarily due to weaker Barbie sales, while infant, toddler and preschool billings fell 11 per cent on lower Fisher-Price demand.
Chief financial officer Paul Ruh said Mattel achieved further savings from a three-year programme, which is on track to achieve US$225 million of savings by year-end.
"In line with our capital allocation priorities, we are making strategic investments to accelerate growth and repurchased another US$100 million of shares in the quarter, bringing the year-to-date total to US$300 million of shares, and we continue to expect repurchases of US$400 million in total this year, while maintaining a strong balance sheet."
Looking ahead, Mattel reaffirmed its fiscal 2026 guidance, continuing to expect constant-currency net sales growth of 3 per cent to 6 per cent, adjusted gross margin of about 50 per cent, and adjusted earnings of US$1.27 to US$1.39 per share.
--BERNAMA-dpa