Mattel, the renowned toy company, has hailed the recent “Barbie” movie as a groundbreaking success, propelling the brand to global recognition. Chief Executive Ynon Kreiz revealed during Mattel’s second-quarter earnings conference call that the film serves as a “template” for future endeavors, including more films and television projects.
Kreiz emphasized the current momentum not only for the Barbie brand but also for other brands within the company. He stated that the goal was not limited to one movie but rather to establish a film franchise, expanding the brand in various innovative ways. While it is premature to discuss sequels at this stage, Kreiz highlighted the growing trend among major studios to focus on franchise-building in response to investor demands for increased profitability.
The movie’s success has translated into high demand for movie-related Barbie toys, with significant sell-outs across major distribution channels. Kreiz further announced that Mattel plans to extend the range of these offerings in the latter half of the year. The company has already secured over 165 consumer product partnerships in connection with the film, further solidifying its success.
Despite the triumph of the “Barbie” movie at the box office, Mattel maintained its full-year forecast for now. The film, directed by Greta Gerwig and featuring stars Margot Robbie and Ryan Gosling, generated an impressive $337 million in worldwide revenue during its debut weekend. Warner Bros. Discovery Inc. produced the film, partnering with Mattel to bring this iconic character to life on the big screen.
This extraordinary achievement not only strengthens the Barbie brand but also provides Mattel with an opportunity to explore new avenues for growth and expansion across various entertainment platforms. With the inspiring success of the “Barbie” movie as a driving force, Mattel is poised to continue captivating audiences and shaping the future of its brands through exciting cinematic experiences.
Mattel’s Expectations for Growth in 2023
Despite facing some challenges, Mattel remains optimistic about the future growth of Barbie. In response to an analyst’s inquiry about their 2023 projections, management acknowledged that the promotional timing of a film had impacted demand trends in the first half of the year. However, they assured investors that they still anticipated “significant growth” for Barbie in the second half of the year, ultimately leading to positive growth for the year as a whole.
Overall, the toy industry has experienced a slight decline in demand recently. During the pandemic, consumers purchased more toys, but as inflation became a concern, consumer spending shifted towards essential goods. This resulted in a softer market for toys. Additionally, retailers have been reluctant to place new orders as they focus on clearing out excess inventory from their warehouses and stock rooms.
Chief Financial Officer Anthony DiSilvestro addressed these challenges, stating that the second-quarter financial results were negatively impacted by ongoing inventory management efforts by retailers. However, he expressed confidence that the inventory correction was mostly behind them and looked forward to meeting consumer demand in the second half of the year, especially during the crucial holiday season. Based on their performance so far this year and their outlook for the remainder of the year, Mattel reasserted their guidance.
Post-market trading saw a decline of 1.8% in Mattel’s shares on Wednesday.