Mattel Cuts 2025 Forecast Due to Tariff Uncertainties

Mattel cuts 2025 forecast after reinstating it, citing weak Barbie sales in North America and global trade uncertainties. The toy maker expects a 1% to 3% rise in 2025 net sales, lower than its February target, and a 50% adjusted gross margin. Mattel CEO Ynon Kreiz attributed the slowdown to retailer ordering patterns and tariffs, with the company expecting to recover most of its sales in the back half of the year.

Title: Mattel Cuts 2025 Forecast After Reinstating It, Citing Weak Barbie Sales and Global Trade Uncertainties

Toymaker Mattel has cut its 2025 forecast after reinstating it in July, citing weak Barbie sales in North America and global trade uncertainties. The company expects a 1% to 3% rise in 2025 net sales, lower than its February target, and an adjusted gross margin of 50%. CEO Ynon Kreiz attributed the slowdown to retailer ordering patterns and tariffs, with the company expecting to recover most of its sales in the back half of the year.

Mattel's second-quarter revenue dropped by 6% to $1.02 billion, missing analysts' average estimate of a 2.7% decline to $1.05 billion [1]. The weakness was driven by a 16% fall in North America sales, primarily due to fewer new product launches for Barbie and delayed inventory decisions by retailers. Worldwide gross billings for dolls fell by 19%, while the infant, toddler, and preschool category, which includes Fisher-Price, Baby Gear & Power Wheels brands, logged a 25% drop [2].

Mattel's finance chief Paul Ruh said timing shifts in retailer ordering patterns impacted its U.S. business, indicating that retailers such as Walmart, Target, and Amazon.com were limiting building up inventory going into the key holiday season to minimize exposure to higher tariff rates [3]. Earlier in the day, rival Hasbro raised its annual revenue outlook, betting on the strength of its digital games and cost-cutting efforts to weather the impact of mounting economic and tariff uncertainty [4].

Mattel expects to fully mitigate tariff costs in 2025 through a combination of price hikes and diversifying its supply chain. The company estimates the tariffs exposure this year, based on current tariff levels, to be less than $100 million [3]. Adjusted profit came in at 19 cents per share, compared with the estimate of 15 cents each [2].

Shares of Mattel fell 3.6% in trading after the bell, reflecting the company's lower-than-expected performance and revised guidance [5]. The company's gross margin improved to 50.9%, an increase of 170 basis points compared to the prior year, while adjusted gross margin rose 200 basis points to 51.2% [5].

References:
[1] https://www.reuters.com/world/china/mattel-posts-steeper-sales-decline-than-expected-soft-barbie-demand-2025-07-23/
[2] https://finance.yahoo.com/news/mattel-posts-steeper-sales-decline-200700882.html
[3] https://sg.finance.yahoo.com/news/mattel-posts-steeper-sales-decline-200700882.html
[4] https://www.newsmax.com/finance/streettalk/mattel-earnings-barbie/2025/07/23/id/1219810/
[5] https://www.investing.com/news/transcripts/mattel-shares-fall-3-as-revenue-misses-estimates-guidance-lowered-4149253