The company has announced that it will cut 2,200 jobs along with plans to sell factories in Mexico.
The company also said that it will cut 2,200 jobs, or 22% of its global non-manufacturing workforce, and plans to sell factories in Mexico, as part of a $650m cost-saving programme.
Mattel’s net sales fell 13.7% to $840.7m in the second quarter ended 30th June, short of the $851.8m analysts had expected, according to Thomson Reuters I/B/E/S. Worldwide gross sales increased by 2%, excluding the impact of the Toys R Us liquidation.
Revenue from the company’s partner brands, which includes sales from toys based on movie franchisees, fell 23% in the reported quarter. However, for the quarter, sales of Barbie and Hot Wheels were up double digits – 24% and 15% respectively – while Fisher-Price and Thomas & Friends were down mid-single digits.
The company, like the rest of the US toy industry, has been hit hard by the liquidation of retailer Toys R Us and said the closure of its biggest customer dented its gross sales by 10% in the second quarter.
Mattel’s newly appointed chief executive officer Ynon Kreiz commented: “Mattel delivered positive sales growth in the first quarter, excluding the impact of the Toys R Us liquidation. And we continue to see strong momentum in our key Power Brands, with Barbie and Hot Wheels each up double-digits. While Toys R Us will present a near term challenge, our transformation plan remains our focus, as we work to deliver improved profitability and return Mattel to its leadership position as a high-performing toy company.”
Net loss in the reported quarter widened to $240.9m, or 70 cents per share, from $56.1m, or 16 cents per share, a year earlier.
Mattel had a total of about 28,000 employees as of 31st December 2017.