Mattel, the toymaker behind Barbie and Hot Wheels, is laying off 120 workers from its El Segundo headquarters, according to a notice provided to state and local officials.

The toy and entertainment company is cutting various roles including in marketing, design and information technology. Some of the employees held positions as managers, directors or vice presidents at the company, the notice states.

Employers are legally required to alert employees along with state and local officials at least 60 days before a mass layoff in what’s known as a WARN notice. Mattel submitted the notice on Monday and said it expects laid-off workers will start leaving the company on May 19.

The job cuts are part of a cost-cutting effort the company started last year focused on growing Mattel's profits.

"They are intended to strengthen our organizational structure to drive our growth objectives and optimize our operations,” Mattel spokesperson Catherine Frymark said in a statement. The company set a target of $200 million in cost savings by 2026.

Toy companies have also been bracing for the potential impact of President Trump’s tariffs on imports from Canada, Mexico and China, a country where their products are made.

In February, Mattel’s Chief Financial Officer Anthony DiSilvestro told analysts during Mattel's quarterly earnings the company has diversified where it manufactures its toys.

Mattel expects China will represent less than 40% of global production for Mattel’s toys in 2025, he said, which is lower than the industry average of about 80%.

The company could also mitigate the potential impact of tariffs by increasing prices and leveraging its supply chain.

“Without getting into too many details for competitive reasons, we have flexibility in terms of sourcing, in terms of destination, in terms of supply chain. We also are looking at potential pricing actions to mitigate the impact of tariffs,” DiSilvestro said at the UBS Global Consumer and Retail Conference earlier in March.

Mattel doesn’t expect any single country to represent more than 25% of its global production by 2027.

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Toy companies struggled after the closure of Toys R Us in 2018 and amid inflation. Mattel laid off workers in 2023, citing economic challenges.

But global toy sales stabilized last year in part because a growing number of adults are buying toys for themselves, according to market research firm Circana. This year, Mattel won back rights to create action figures and other toys based on DC characters such as Batman and Superman in the second half of 2026.

Mattel’s net sales were $5.4 billion in 2024, a 1% drop compared with the same period the year before. The company’s net income reached $542 million, up from $214 million in 2023.

The company expects net sales will increase by at least 2% this year driven partly by sales of Hot Wheels, UNO and products tied to the release of new movies such as Disney’s "Snow White" and the sequel to "Wicked."

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This story originally appeared in Los Angeles Times.