Mattel reported sales declines across all of its product categories even though coronavirus shutdowns have boosted the toy industry as a whole.
For the second quarter, Mattel’s net toy sales declined nearly 15% to $732.1 million as the economic impact of the health crisis hammered demand in overseas markets.
Gross sales in North America rose 3%, mainly driven by an increase in demand for Barbie dolls, Uno playing cards, as well as “Baby Yoda” plush toys.
“We entered the second quarter with extensive retail closures and distribution challenges and had to absorb a full quarter of COVID-19 impact, but we demonstrated our execution capabilities and the resilience of our brands,” Mattel CEO Ynon Kreiz said in a news release
Mattel beat analysts’ net sales estimates of $678.5 million but CNBC said its “sluggish sales are in stark contrast to the overall success the toy industry has seen in the wake of the coronavirus pandemic. For the first six months of the year, industry-wide toy sales have soared 16%, according to data from the NPD Group, as parents sought to keep kids entertained at home.”
Despite Barbie’s strength in North America, Mattel’s worldwide gross sales for dolls fell 5% to $261.0 million. Other categories posted steeper declines, including infant, toddler and preschool (down 21%), vehicles (down 26%), and action figures (down 12%).
The toymaker said it was expecting its sales to improve in the coming months as the surge in virus cases potentially keeps schools shut in many parts of the U.S.
According to Kreiz, only 4% of Mattel’s retail outlets, which normally account for about 8% of the company’s sales, were closed at the end of June compared to about 30% at the end of March.
“Based on the momentum we are seeing, the positive [point-of-sale] trends, and low retail inventories exiting the quarter, we are planning for strong demand for our products in expectation of an improved revenue performance in the second half compared to the first half, including the all-important holiday season,” Kreiz said.