Mattel Lowers Annual Performance Outlook as New CEO Takes Office

Reuters, November 5 - Mattel (MAT.O) on Thursday significantly lowered its annual sales and profit forecasts ahead of the critical holiday shopping season, as new CEO Roger Lynch faces mounting investor pressure to reverse the fortunes of the Barbie maker.

Toy manufacturers are grappling with weak demand as U.S. consumers cut back on discretionary spending due to rising energy costs.

Mattel is implementing an IP-driven strategy aimed at expanding brands such as Barbie, Hot Wheels, and UNO into the entertainment, licensing, and consumer products sectors, seeking growth beyond traditional toy sales.

“I also clearly see the areas where we need to improve. We will concentrate our resources on the highest-potential opportunities,” Lynch said in a statement.

Mattel now expects sales growth for fiscal 2026 to be between 1% and 4%, down from a previous forecast of 3% to 6%. The company also cut its full-year adjusted earnings outlook to $1.05 to $1.20 per share from its prior range of $1.27 to $1.39.

The company is also undergoing major leadership changes.

With longtime CEO Ynon Kreiz departing in October, Lynch took over earlier this week; at the same time, Peter Griffith (link) was named Chief Financial Officer, replacing Paul Ruh.

On Thursday, Mattel appointed company insider Steve Totzke as Chief Operating Officer, effective November 11.

Meanwhile, shareholders including Ariel Investments (link) and Southeastern Asset Management (link) have urged Mattel to explore strategic options, including a possible sale.

Third-quarter adjusted gross margin expanded to 55.0% from 50.2% a year earlier, boosted by an $88 million tariff rebate.

According to data from London Stock Exchange Group (LSEG), net sales for the quarter ended September 30 rose 4% to $1.81 billion, but missed analyst expectations of $1.84 billion. Adjusted earnings per share were $1.30, above the expected $0.94.

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