Mattel turnaround stalls as Barbie doll out of fashion
The world's largest toymaker Mattel's turnaround still has a long way to go. The firm posted first-quarter results that fell far short of Wall Street estimates, renewing concerns that its comeback is faltering.
Excluding some items, the loss was 32 cents a share, a good deal wider than the deficit of 17 cents that analysts predicted.
This quarter comes after a disappointing holiday season, signalling that the company's new chief executive Margo Georgiadis has a lot of work to do.
The former Google executive joined Mattel in February, and set about trying to reinvigorate brands such as Barbie.
The doll, Mattel's biggest property, saw sales fall 13pc in the quarter. The latest results sent the shares down as much as 7.6pc to $23.30 in early trading on Friday. They had already declined 8.5pc this year through the close of trading on Thursday
The lacklustre Christmas season in North America created a glut of inventory at retailers that slowed orders in the new year, Georgiadis said.
But there was a positive sign: sales of the Barbies and other toys that were already on store shelves grew last quarter, she said. "We're confident we've worked through those inventory issues at this point," Georgiadis said.
The first quarter also is traditionally a slow time for Mattel, representing only 10pc of its total sales, she said.
Mattel had reported positive quarters in the past year as Barbie regained some of its prior popularity.
But the famous doll's star power faded during the holidays, with sales falling 2pc in the fourth quarter.
Mattel's first-quarter revenue sank 15pc to $735.6m. That figure trailed projections of $790.5m.
Sunday Indo Business