About Mattel

Mattel, Inc. (Mattel) operates as a global toy company. The company owns one of the strongest catalogs of children's and family entertainment franchises in the world. Mattel creates innovative products and experiences that inspire, entertain, and develop children through play. Mattel is focuses on the following evolved strategy to grow its intellectual property (IP) driven toy business and expand its entertainment offering: Accelerate topline growth through scaling Mattel's portfolio, growing franchise brands, and advancing e-commerce and direct-to-consumer business, and increasing profitability by continuing to optimize operations; and Expand entertainment offering to capture the full value of Mattel's IP in highly accretive business verticals, including content, consumer products, and digital experiences. Mattel is the owner of a portfolio of iconic brands and partners with global entertainment companies to license other intellectual property. Mattel's portfolio of owned and licensed brands and products are organized into the following categories: Dolls: Includes brands, such as Barbie, American Girl, Disney Princess and Frozen, Monster High, and Polly Pocket. Mattel's Dolls portfolio is driven by the flagship Barbie brand and a collection of complementary brands offered globally. American Girl, with an extensive portfolio of dolls and accessories, content, gaming, and lifestyle products, is best known for imparting valuable life lessons that instill confidence through its inspiring dolls and books, featuring diverse characters from past and present. American Girl products are sold directly to consumers through its website, proprietary retail stores in the United States, at select retailers nationwide, and at specialty boutiques and franchise stores in Canada. Infant, Toddler, and Preschool: Includes brands, such as Fisher-Price and Thomas & Friends, and PowerWheels. As a leader in play and child development, Fisher-Price's mission is to help families by making the most fun, enriching products for infants, toddlers, and preschoolers. Thomas & Friends is an award-winning preschool train brand franchise that brings meaningful life lessons of friendship and teamwork to kids through toys, content, live events, and other consumer products. Vehicles: Includes brands, such as Hot Wheels (including Hot Wheels Monster Trucks and Hot Wheels Mario Kart (Nintendo)), Matchbox, and Cars (Disney Pixar). Hot Wheels continues to push the limits of performance and design and ignites the challenger spirit of kids, adults, and collectors. From die-cast vehicles to tracks, playsets, and accessories, the Mattel Vehicles portfolio has broad appeal that engages and excites kids of all ages. Action Figures, Building Sets, Games, and Other: Includes brands, such as Masters of the Universe, MEGA, UNO, Lightyear (Disney Pixar), Jurassic World (NBCUniversal), WWE, and Star Wars (Disney's Lucasfilm). Mattel's Action Figures portfolio consists of product lines associated with licensed entertainment franchises that are driven by major tentpole releases, such as Lightyear and Jurassic World, as well as product lines from Mattel's owned IP, such as Masters of the Universe. As the challenger brand in Building Sets, MEGA sparks creativity through the power of connection with builders of all ages and fans of global franchises. Within Games, UNO is the classic matching card game that is easy to learn and fast fun for everyone. Other includes Plush, which contains products associated with movie releases from licensed entertainment franchises, as well as Mattel-owned IP. Business Segments The company operates through North America (which consists of the United States and Canada), International, and American Girl segments. North America segment The North America segment markets and sells toys and consumer products in the United States and Canada across all of Mattel's categories. Dolls Barbie continues to deliver innovation, purpose-driven marketing campaigns, and engaging toys connected to a strong system of play. Barbie has broad product offerings, with product lines designed to appeal to children of multiple age groups, complemented by a Barbie Signature line with high-quality dolls that appeal to fans of all ages. In 2023, Barbie will be featured in a live action theatrical movie directed by Greta Gerwig and starring Margot Robbie and Ryan Gosling, which will include the launch of an all new Dreamhouse in the support of the release. Barbie will also launch exciting new lines, including My First Barbie, Styling Head, and Large Doll, and will introduce more high-profile partnerships and pop culture collaborations. Mattel is also excited to build upon its strong partnerships with Disney with the return of the Disney Princess and Frozen product lines, and Universal with the launch of new Trolls product lines. Monster High will look to build upon the success of its 2022 the U.S. re-launch with a full global re-launch in 2023, including new content and product offerings. Infant, Toddler, and Preschool In 2023, Fisher-Price will continue its focus on engaging consumers as a trusted partner for families with infants, toddlers and preschoolers, by continuing to create brand love through innovative products and inviting adults back into the world of childhood. Design-led innovation will continue to drive new product offerings, including the expansion of the Linkimals product line and new innovative toys from Imaginext. Mattel will look to continue its strong momentum in the Little People product line with the expansion of the Little People Barbie line and Little People Collector, tapping into a new consumer base. New preschool toys will include product lines associated with the episodic content launch of Batwheels, an ultimate world of racing and chasing series. Vehicles In 2023, industry leader Hot Wheels will look to continue its strong momentum as a multigenerational franchise with consumer interest that remains at historic highs. Hot Wheels product offerings will continue to excite with innovation in Tracks and Playsets, expansion of the 2022 Hot Wheels Skate launch, introduction of product lines for The Super Mario Bros. Movie (Universal) animated theatrical movie, and more digital ways to collect with the NFT Garage series. Hot Wheels will also continue to enter new vehicle play segments, while upholding the quality and performance of Hot Wheels. Die-cast pioneer Matchbox will celebrate its 70th anniversary, honoring its legacy with special edition die-cast offerings and packaging. Matchbox will continue to bring exciting new products to market, including product partnerships with SpaceX, and new episodes of the globally popular YouTube series, Matchbox Adventures. Mattel will continue to partner with Disney Pixar for Cars with fresh new product offerings, building on the excitement from the Fall 2022 release of Cars on the Road content, and supporting Disney's 100-year anniversary with Cars Disney 100 toys. Action Figures, Building Sets, Games, and Other Mattel Action Figures will continue to collaborate with key licensor partners, such as Disney Pixar, Microsoft, NBCUniversal, and WWE, to bring innovative products to the global marketplace. A sample of Mattel's 2023 Action Figures product lines include toys tied to Microsoft's Spring release of the new Minecraft Legends game, and NBCUniversal's Jurassic World, which will be celebrating the 30th anniversary of the Jurassic Park franchise. Mattel will continue to expand its Masters of the Universe franchise with products for fans of all ages and continued expansion of the collector business. In Building Sets, MEGA sparks creativity through the power of connection with builders of all ages and fans of global franchises. Partnerships with some of the world's top franchises, including Pokemon, Barbie and Hot Wheels, invite consumers to try MEGA building sets, while innovative building play, authentic details, compatible quality, and accessible value encourages consumers to stay in the MEGA building set collection. Parents of preschoolers can continue to discover how the MEGA Bloks preschool building system enhances playtime and early childhood development beyond the Big Building Bag. Mattel Games consists of some of the most beloved Games IP in the world, including UNO, Pictionary, Skip-Bo, Blokus, and many others. Mattel will focus on its expansion of Games into its direct-to-consumer business, collectability, and innovation. Additionally, Mattel will continue to introduce new game extensions and partnerships that celebrate pop culture. Mattel Plush will continue to collaborate with key licensor partners, including Disney's Lucasfilm, Pixar, Marvel, Microsoft's Minecraft, NBCUniversal's Jurassic World, and many more. The Plush portfolio is expected to benefit from tentpole moments capitalizing on this strong entertainment slate in 2023. Mattel will also bring its iconic IP into the Plush category. International segment Products marketed and sold by the International segment are generally the same as those marketed and sold by the North America segment, although some are developed or adapted for particular international markets. Mattel's products are sold directly to retailers and wholesalers in most European, Latin American, and Asian countries, in Australia and New Zealand, in certain countries in the Middle East and Africa, and through agents and distributors in those countries where Mattel has no direct presence. American Girl segment The American Girl segment is a direct marketer, retailer, and children's publisher dedicated to its mission to help girls grow up with confidence and character. American Girl is best known for its line of historical and contemporary characters that feature 18 inch dolls, books, and accessories that inspire girls to face the world with courage, resilience, and kindness. The contemporary Truly Me and Create Your Own lines encourage girls to express their imaginations and creativity by choosing a doll that looks like them or custom-creating one that's completely unique from more than one million options. Bitty Baby introduces younger girls to nurturing play until they are ready for WellieWishers, a sweet group of girls who focus on empathy and being a good friend. American Girl also publishes best-selling fiction and non-fiction books, as well as an array of popular digital content. The American Girl segment sells products directly to consumers through its website, in its proprietary retail stores in the United States, at select retailers nationwide, and at specialty boutiques and franchise stores in Canada. Competition The North America segment competes with several large toy companies, including Hasbro, Jazwares, LEGO, MGA Entertainment, the Pokemon Company, Spin Master, many smaller toy companies, and manufacturers of video games and consumer electronics. The International segment competes with global toy companies, including Hasbro, Jazwares, LEGO, MGA Entertainment, the Pokemon Company, Spin Master, other national and regional toy companies, and manufacturers of video games and consumer electronics. Seasonality Mattel's business is highly seasonal, with consumers making a large percentage of all toy purchases during the traditional holiday season. A significant portion of retailer purchasing typically occurs in the third and fourth quarters (year ended December 31, 2022) of Mattel's fiscal year in anticipation of holiday buying. These seasonal purchasing patterns and requisite production lead times create risk to Mattel's business associated with the underproduction of popular toys and the overproduction of less popular toys that do not match consumer demand. In anticipation of retail sales during the traditional holiday season, Mattel significantly increases its production in advance of the peak selling period, resulting in a corresponding build-up of inventory levels in the first three quarters of its fiscal year. Seasonal shipping patterns generally result in significant peaks in the third and fourth quarters in the respective levels of inventories and accounts receivable, which may result in seasonal working capital financing requirements. Through the third quarter of 2022, Mattel accelerated its inventory production to meet demand levels and reduce supply chain risk while retailers also increased their inventory levels to replenish low inventory levels entering 2022 and to meet expected growth in demand ahead of the holiday season. However, consumer demand was lower than expected during the holiday season, and occurred later than expected in the fourth quarter of 2022, which caused retailers to reduce replenishment orders as they managed their inventory. Elevated retailer inventory levels are expected to have an unfavorable impact to net sales in 2023, particularly in the first half of the year. Sales Mattel's products are sold throughout the world. Products within the North America segment are sold directly to retailers, including omnichannel retailers, discount and free-standing toy stores, chain stores, department stores, other retail outlets, and, to a limited extent, wholesalers. Mattel also operates small retail outlets at certain corporate offices as a service to its employees and as an outlet for its products. Products within the International segment are sold directly to retailers and wholesalers in most European, Latin American, and Asian countries, in Australia and New Zealand, and through agents and distributors in those countries where Mattel has no direct presence. Mattel also has retail outlets in Latin America that serve as outlets for its products. American Girl products and its children's publications are sold directly to consumers and select retailers in North America. Mattel has retail space in Chicago, Illinois; Los Angeles, California; and New York, New York for its flagship American Girl stores, and in six other cities across the United States for its American Girl boutique stores, each of which features children's products from the American Girl segment. Additionally, Mattel sells certain of its products directly to consumers through its e-commerce platforms. During 2022, Mattel's three largest customers, such as Walmart, Target, and Amazon, accounted for approximately 43% of worldwide consolidated net sales. Licenses and Distribution Agreements Mattel has license agreements with third parties that permit Mattel to utilize the trademark, characters, or inventions of the licensor in products that Mattel sells. A number of these licenses relate to product lines that are significant to Mattel's business and operations. Mattel has entered into agreements to license entertainment properties, including among others, Disney Consumer Products (including Disney Princess and Frozen, Star Wars, Disney Pixar (including Cars, Lightyear, and Toy Story) and certain other Disney films and television properties), NBCUniversal (including Jurassic World, Trolls, and Fast and Furious), Paramount (relating to its Nickelodeon properties), Warner Bros. (including Batman, Superman, Wonder Woman, Justice League and Harry Potter), Microsoft (including Minecraft and Halo), WWE, and Pokemon. Government Regulations Mattel's products sold in the United States are subject to the provisions of the Consumer Product Safety Act, as amended by the Consumer Product Safety Improvement Act of 2008; and the Federal Hazardous Substances Act. Mattel's advertising and marketing activities are subject to the Federal Trade Commission Act and the Children's Television Act of 1990. In addition, Mattel's web-based products and services and other online and digital communications activity are subject to the U.S. and foreign privacy-related regulations, including the U.S. Children's Online Privacy Protection Act of 1998 and the EU General Data Protection Regulation and related national regulations. Privacy-related laws also exist in some U.S. states, such as the California Consumer Privacy Act, as amended by the California Privacy Rights Act, and other state laws that have taken effect in 2023, or are yet to take effect. The company is in substantial compliance with these laws and regulations. History Mattel, Inc. was founded in 1945. The company was incorporated in 1948.