Mattel (MAT) FY 2025 Conference September 03, 2025 08:55 AM ET Company ParticipantsStephen Laszczyk - Vice PresidentYnon Kreiz - Chairman & CEOPaul Ruh - CFOStephen LaszczykAll right, great. Thank you, everyone, for joining us this morning. Welcome to the GS Global Retailing Conference. For those who don't know me, my name is Stephen Laschick, and I'm the Lead Entertainment Analyst here at Goldman Sachs. To kick off this morning, we're excited to welcome to the conference this year Ynon Kreiz and Anthony Di ...

Mattel (MAT) FY 2025 Conference September 03, 2025 08:55 AM ET Speaker0All right, great. Thank you, everyone, for joining us this morning. Welcome to the GS Global Retailing Conference. For those who don't know me, my name is Stephen Laschick, and I'm the Lead Entertainment Analyst here at Goldman Sachs. To kick off this morning, we're excited to welcome to the conference this year Ynon Kreiz and Anthony DiSilvestro, the CEO and CFO of Mattel. Thank you both for being with us today.Speaker1Thank you for inv ...

Mattel (MAT) FY 2025 Conference September 03, 2025 08:55 AM ET Speaker0All right, great. Thank you, everyone, for joining us this morning. Welcome to the GS Global Retailing Conference. For those who don't know me, my name is Stephen Laschick, and I'm the Lead Entertainment Analyst here at Goldman Sachs. To kick off this morning, we're excited to welcome to the conference this year Ynon Kreiz and Anthony DiSilvestro, the CEO and CFO of Mattel. Thank you both for being with us today.Speaker1Thank you for inv ...

Financial Data and Key Metrics Changes - Net sales declined by 6% as reported and in constant currency to $1.02 billion [6][19] - Adjusted gross margin increased by 200 basis points to 51.2% [7][24] - Adjusted earnings per share remained the same as last year at $0.19 [7][26] - Total gross billings decreased by 4% in constant currency [20] Business Line Data and Key Metrics Changes - Dolls category declined by 19% due to fewer new Barbie product launches and lower retailer promotional support [21] - Vehicles category increased by 10%, with Hot Wheels achieving a 9% growth [21] - Infant, toddler, and preschool category decreased by 25%, primarily due to a decline in Fisher Price [22] - Challenger categories increased by 16%, driven by strong results in action figures [22] Market Data and Key Metrics Changes - Gross billings declined by 15% in North America, while international gross billings increased by 9% [23][24] - EMEA region grew by 8%, Latin America by 5%, and Asia Pacific by 16% [24] Company Strategy and Development Direction - Company is focused on creating innovative products and experiences to inspire and entertain [11] - Strategic collaboration with OpenAI to leverage new technologies for brand expansion [12] - Formation of Mattel Studios to enhance entertainment strategy, aiming to release 1-2 films per year starting in 2026 [12][13] - Continued emphasis on diversifying supply chain and optimizing product sourcing to mitigate tariff impacts [42][88] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing trade uncertainty impacting U.S. business but expressed confidence in brand appeal and operational excellence [6][7] - Consumer demand for toys remains strong, with expectations for continued growth in the toy industry [8][46] - Revised guidance for 2025 includes net sales growth of 1% to 3% in constant currency [31] Other Important Information - Company repurchased $50 million of shares in the quarter, targeting $600 million for the full year [26][30] - Cash balance increased to $870 million, with total debt remaining at $2.34 billion [27][28] - Cost savings program has realized $126 million since its launch in 2024, with a target of $200 million by 2026 [29][30] Q&A Session Summary Question: What were the major factors affecting guidance? - Management discussed the impact of lowered top-line guidance and tariff effects on the bottom line, alongside actions taken to mitigate these headwinds [34][36] Question: How are pricing strategies being adjusted in response to tariffs? - Management stated that pricing actions have been implemented in collaboration with retail partners, aiming to keep prices low for consumers [39][41] Question: What is the outlook for consumer demand in the second half of the year? - Management indicated strong consumer demand across all regions, with expectations for continued growth despite potential uncertainties [44][46] Question: How are inventory levels currently positioned? - Management confirmed that inventory levels are appropriate and aligned with retail needs, with no significant disruptions expected [75][76] Question: What is the expected impact of tariffs on gross margins? - Management estimated total tariff exposure for the year to be less than $100 million, with mitigating actions in place to offset impacts [71][72]