March 8, 2009
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Mattel’s Earnings Crash as the Economy Hits the Doll Business
Selling a 50-year-old icon to the seven-year-old set likely wasn’t going to be a cakewalk anyway. But this probably wasn’t the way Mattel would have wanted to open the campaign.
The toymaker, preparing to launch an anniversary effort to make its half-century-old Barbie product more relevant and appealing to a consumer easily distracted by videos, games and all things digital, posted a fourth quarter that’s nothing short of forgettable – if not outright regrettable. Net fell 46%, as margins declined and internationl sales slumped.Earnings missed forecasts by a huge margin – coming in at 49 cents a share, versus projections of 76 cents, as the company’s net plunged 46% on a year-over-year basis. Revenue came up short of forecasts, hurt, in part, by the performance of the dollar.
Still, this wasn’t any kind of mechanical, currency-driven shortfall.
According to Wall Street this is a dismal company, with a poorly performing product line and a management that’s willing to blame the economy, rather than figure out how to turn around its signature products. ”Barbie” – at least as a brand – is a global icon. Yet, sales plunged 21% year-over-year.
What can be done to revive the brand? I am giving it some real thought.
Comments (2)
I HAD NO IDEA THAT MATTEL WAS DONG SO POORLY. I JUST HOPE THEY DON’T LOSE THE BATTLE AND TRY TO FIND SOMEONE WITH THE IDEAS THAT THEY NEED TO COMPETE. I WOULD JUST HATE TO SEE BARBIE’S LEGACY END HERE. I REMEMBER GETTING MY FIRST BABBIE AT AGE 9. I KEPT HER FOR YEARS AND YEARS AND THEN SHE GOT LOST IN THE MOVES OVER THE YEARS. WHAT A SHAME…SHE WOULD PROBABLY HAVE BEEN WORTH A LOT SINCE I TOOK SUCH GOOD CARE OF HER. I HOPE THAT MANY OF THESE COMPANIES CAN HANG ON. IF THEY ARE DOING POORLY ANYWAY…THE ECONOMY COULD BE THE NAIL IN THEIR COFFIN!
I was shocked to hear that too…with all of the digital things these days maybe kids don’t play with them anymore….? hope they can hang on…