MW Mattel halts outlook amid 'evolving U.S. tariff landscape,' keeps buyback plans

By Bill Peters

Toy maker says it plans to raise prices 'where necessary'

Mattel Inc. on Monday said it planned to raise prices "where necessary" on some U.S. toys, while pausing its full-year outlook, as it tries to get a handle on the impact of the global trade war.

"Given the volatile macroeconomic environment and evolving U.S. tariff landscape, it is difficult to predict consumer spending and Mattel's U.S. sales in the remainder of the year and holiday season," management said in Mattel's earnings release. "The company is therefore pausing full-year 2025 guidance until Mattel has sufficient visibility."

The maker of Barbie, Hot Wheels and other classic toys reported an adjusted loss per share of 3 cents for the first quarter. The company reported sales of $826.6 million.

Analysts polled by FactSet expected Mattel to report an adjusted loss per share of 10 cents, on sales of $786 million.

Shares $(MAT)$ fell 1.7% after hours.

Mattel said it was maintaining its $600 million share repurchase target for the year.

Mattel reported the results as Wall Street tries to gauge the impact of President Donald Trump's tariffs on consumer spending and on businesses' supply chains and shipments. Economists have worried that tariffs could drive prices higher for shoppers, as businesses try to cover the higher import costs.

China, so far, has been the main target of the Trump administration's trade war. The toy industry has also expressed concern about order cancellations, production halts and the potential harm to smaller toy makers and holiday-season sales.

Both Mattel and its rival Hasbro Inc. $(HAS)$ have tried to rely less on China for making toys, while tapping their reserves of toy-related intellectual property that they can convert into films, shows, games and other content. In February, when Mattel last reported quarterly results, executives said that they expected China to account for less than 40% of its toy production, compared with around 80% on average for the rest of the industry, and said it got its products from seven different nations.

Last month, Hasbro's results sent shares higher, helped by its "Wizards of the Coast" gaming segment. However, the company has not incorporated the potential impact of tariffs into its financial outlook.

In February, Mattel said the profit outlook it gave at that time factored in "the anticipated impact of new U.S. tariffs on China, Mexico and Canada imports" announced on Feb. 1.

Executives said they could raise prices if needed to offset the costs of those import taxes. However, management made that assessment before Trump announced - then largely paused - far more expansive tariffs in April.

-Bill Peters

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May 05, 2025 16:28 ET (20:28 GMT)

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