Mattel saw a marginal decline in Net Sales in Q1, but reduced its Operating Loss significantly and has reiterated its 2024 guidance.

For the first quarter 2024, Mattel’s Net Sales were down 1% as reported and in constant currency, versus 2023’s first quarter. Reported Operating Loss was $36m, an improvement of $80m.

Net sales in the North America segment increased +2% as reported and in constant currency, driven by growth in Vehicles (primarily Hot Wheels) and Action Figures, Building Sets, Games, and Other (primarily Action Figures), partly offset by declines in Infant, Toddler, Pre-School (primarily Baby Gear) and Dolls (primarily Disney Princess and Disney Frozen).

Net Sales in the International segment decreased -4% as reported or -5% in constant currency, due to declines in Dolls (primarily Disney Princess and Disney Frozen), Infant, Toddler, and Pre-School (primarily Fisher-Price and Preschool Entertainment), and Action Figures, Building Sets, Games, and Other (primarily Action Figures), partly offset by growth in Vehicles (primarily Hot Wheels).

Commenting on the results, Ynon Kreiz, chairman and CEO of Mattel, said: “We are off to a good start to the year with significant gross margin expansion, positive Adjusted EBITDA, and very strong improvement in free cash flow. Trends in consumer demand for our product improved through the quarter and we expect to outpace the industry and gain market share in 2024. We are executing our strategy to grow our IP-driven toy business and expand our entertainment offering.”

Anthony DiSilvestro, CFO of Mattel, added: “We achieved strong bottom-line results, primarily driven by margin expansion, repurchased $100m of shares in the quarter, and are on track to meet our full year guidance. We expect to continue to benefit from the Optimizing for Profitable Growth program, which is targeting $60m in cost savings in 2024 and a total of $200m in cost savings by 2026.”