Live News Updates: Mattel inventories surge in anticipation of strong holiday toy demand – TheHitc

Mattel is stockpiling in anticipation of higher demand for Jurassic World action figures and Hot Wheels cars this holiday season, citing a 20 percent increase in second-quarter revenue as proof inflation hasn’t stopped parents to spend money on toys.

The California-based company behind Thomas & Friends Barbie dolls and trains reported that its adjusted operating income rose 82 percent to $121 million in the three months ended June, despite higher costs on materials, ocean freight and wages.

Action figure gross sales rose almost 50 percent before currency effects, fueled by the films Jurassic World and Lightyear, but sales of its American Girl dolls fell 19 percent. Ynon Kreiz, chief executive, said Mattel sees “a certain softness” in demand for higher-priced toys.

While currency-neutral net sales increased 24 percent to $1.24 billion, Mattel increased inventories by 43 percent, or approximately $360 million. Kreiz said the higher stock levels are reasonable for demand from consumers and retailers who have been placing orders earlier than usual to avoid a repeat of last year’s supply chain delays.

“The big picture is that parents always prioritize spending money on their children. Retailers see the industry as a strategic priority for them in terms of shopping experience, engagement, walk-in customers and so on,” he said in an interview.

Mattel has seen some improvement in inflation in commodities and logistics, Kreiz said, and its own supply chains have been doing well.

The proceeds came a day after Mattel’s Matchbox brand inked a deal with Elon Musk’s SpaceX to make a line of rocket-themed toys and collectibles. “This is really about Mattel expanding our portfolio. . . and to be able to bring new partners into the toy space,” said Kreiz.