Mattel swings to Q2 net loss as tariffs, inflation squeeze margins despite higher sales

Mattel

04/08/2026 21:51

Overview
US toy maker's Q2 net sales rose 10%, beating analyst expectations
Barbie maker posts Q2 net loss of $18 mln vs net income of $53 mln a year ago
Adjusted EPS for Q2 fell sharply from prior year
Company repurchased $100 mln shares in Q2, $300 mln year-to-date

Outlook
Mattel reiterates 2026 guidance, expecting net sales to grow 3%-6% in constant currency
Company expects 2026 adjusted EPS between $1.27 and $1.39
Mattel sees 2026 adjusted gross margin at approximately 50%

Result Drivers
CATEGORY PERFORMANCE - Growth in Vehicles (driven by Hot Wheels) and Action Figures (helped by theatrical releases and digital games), offset by declines in Dolls (Barbie) and Infant, Toddler, and Preschool (Fisher-Price)
COST PRESSURES - Lower gross margin due to tariffs, inflation, higher royalties, and unfavorable foreign exchange, partly offset by cost savings and Mattel163 contribution
HIGHER EXPENSES - Increased advertising and SG&A expenses weighed on operating income despite higher sales

Company press release: ID:nBw8HXSJja

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q2 Sales
Beat
$1.13 bln
$1.10 bln (12 Analysts)
Q2 Net Loss
 
$18 mln
 
Q2 Adjusted Gross Margin
 
48.6%
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 9 "strong buy" or "buy", 6 "hold" and 2 "sell" or "strong sell"
The average consensus recommendation for the toys & children's products peer group is "buy"
Wall Street's median 12-month price target for Mattel Inc is $18.50, about 24.3% above its August 3 closing price of $14.88
The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 11 three months ago

Reuters Recommended Reads
Aug 4 - Mattel misses second-quarter profit estimates as toy spends slow
Aug 4 - Trading card games are 'extremely strong' and here to last, Asmodee CEO says
Aug 3 - Democratic US states sue to challenge Trump's latest tariffs

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)