Mattel to Report Q3 Earnings: Here's What to Expect From the Stock

Core Viewpoint - Mattel, Inc. is expected to report third-quarter 2024 results on October 23, 2024, with earnings estimates showing a decline year over year, indicating potential challenges in sales and profitability [1][2]. Earnings Estimates - The Zacks Consensus Estimate for earnings is set at 94 cents, reflecting a 13% decrease compared to the previous year [2]. - Revenue estimates are approximately $1.84 billion, indicating a 4.1% decline from the same quarter last year [2]. Factors Impacting Performance - Sales in North America are anticipated to be weak, particularly in the Infant, Toddler, Preschool, Dolls, and Vehicle product categories, due to a challenging macroeconomic environment [3]. - Worldwide gross billings for key brands, including Barbie, Fisher-Price, and Hot Wheels, are projected at $524 million, $307 million, and $455 million, representing declines of 13.4%, 3.2%, and flat year over year, respectively [3]. Cost Pressures - The company's bottom line is likely to be affected by higher input cost inflation, unfavorable fixed cost absorption, and increased supply chain costs [4]. - Additional pressures include higher severance and restructuring expenses, incentive compensation, and pay increases, although ongoing cost-saving initiatives may mitigate some of these impacts [4]. Positive Factors - Contributions from the IP-driven toy business, innovations in the toy portfolio, and expanded entertainment offerings are expected to positively influence performance [4]. - The focus on demand creation in collaboration with retail partners and licensing partnerships may also support the company's results in the upcoming quarter [4]. Earnings Prediction Model - The current model does not predict an earnings beat for Mattel, with an Earnings ESP of -3.04% and a Zacks Rank of 3 (Hold) [5].