Mattel Q4 Earnings Beat Estimates, Revenues Lag, Stock Up

Mattel, Inc. MAT reported fourth-quarter 2024 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.In 2024, Mattel repurchased $400 million worth of shares and further improved its leverage ratio. The company remains ahead of schedule in achieving its $200 million cost-savings target by 2026. For 2025, Mattel projects continued revenue and earnings growth, increased investments in digital gaming, and a $600 million share repurchase program, underscoring its commitment to long-term shareholder value creation.Following the announcements, shares of the company gained 9.7% in the after-hours trading session yesterday.Mattel’s Q4 Earnings & Sales DiscussionMattel reported adjusted earnings per share (EPS) of 35 cents, which beat the Zacks Consensus Estimate of 23 cents by 52.2%. It reported adjusted EPS of 29 cents in the prior-year quarter.Mattel, Inc. Price, Consensus and EPS Surprise Mattel, Inc. price-consensus-eps-surprise-chart | Mattel, Inc. QuoteNet sales amounted to $1.64 billion, marginally missing the consensus estimate of $1.66 billion by 0.5%. The top line increased 2% on a reported basis and 3% in constant currency (cc) year over year.Net sales in the North America segment increased 1% year over year on a reported basis and at cc. The International segment’s net sales increased 3% (as reported) and 6% (at cc) year over year.In the North America segment, gross billings inched up 1% (as reported and at cc) year over year. The upside was backed by growth in Vehicles (primarily Hot Wheels), and Action Figures, Building Sets, Games, and Other (primarily Action Figures). This was partly offset by declines in Infant, Toddler, and Preschool (primarily Baby Gear & Power Wheels) and Dolls (primarily Barbie).Gross billings in the International segment increased 3% (on a reported basis) and 6% (at cc) year over year. The uptick was primarily due to a rise in Vehicles (primarily Hot Wheels) and Infant, Toddler, and Preschool. This was partially offset by a decline in Dolls (primarily Barbie).MAT’s Category-Wise Worldwide SalesMattel, through its subsidiaries, sells a broad range of toys. These items are grouped under different categories: Dolls; Infant, Toddler and Preschool; Vehicles and Action Figures, Building Sets, Games and Other.Worldwide gross billings by Mattel Power Brands increased 2% year over year on a reported basis (and 3% at cc) to $1.88 billion. The gross billings for Dolls witnessed a fall of 4% year over year on a reported basis and at cc due to declines in Barbie.Gross billings for Infant, Toddler and Preschool declined 5% (on a reported basis) and 4% (at cc) year over year due to declines in Baby Gear & Power Wheels.Gross billings for Vehicles were up 14% (on a reported basis) and 16% year over year (at cc), primarily driven by growth in Hot Wheels. Gross billings for Action Figures, Building Sets, Games and Other were also up 5% (on a reported basis) and 6% year over year (at cc) due to growth in Action Figures and Games, partly offset by declines in Other and Building Sets.MAT’s Operating ResultsDuring the fourth quarter, Mattel’s adjusted gross margin was 50.8%, up 200 basis points year over year. The upside was primarily driven by savings from supply-chain efficiencies, savings from the Optimizing for Profitable Growth program and foreign exchange favorability.Adjusted EBITDA during the quarter came in at $248.9 million compared with $234 million.Adjusted other selling and administrative expenses increased $9 million year over year to $418 million. The uptick was mainly caused by higher employee compensation, partly offset by savings from the Optimizing for Profitable Growth program.Balance Sheet of MattelAs of Dec. 31, 2024, MAT’s cash and cash equivalents were $1.39 billion compared with $1.26 billion at 2023-end. Total inventories at the end of the quarter were $501.7 million compared with $571.6 million at 2023-end.Long-term debt (as of Dec. 31) was $2.33 billion, approximately on par with the reported value at 2023-end. Shareholders’ equity was $2.26 billion at the end of the quarter.MAT 2024 HighlightsNet sales in 2024 amounted to $5.38 billion compared with $5.44 billion in 2023.Net income in 2024 came in at $541.8 million compared with $214.4 million reported in 2023.In 2024, adjusted diluted EPS came in at $1.62 compared with $1.23 reported in the previous year.MAT’s 2025 OutlookManagement expects 2025 net sales to increase in the range of 2-3% year over year. The company expects adjusted operating income to be between $740 and $765 million.Mattel anticipates adjusted EPS to be between $1.66 and $1.72 compared with $1.62 reported in 2024. The adjusted tax rate is considered to be between 23% and 24%.MAT’s Zacks RankMAT currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Recent Consumer Discretionary ReleasesAdtalem Global Education Inc. ATGE posted better-than-expected results in second-quarter fiscal 2025. Earnings and revenues surpassed the respective Zacks Consensus Estimate and increased year over year, driven by strong enrollment growth and strategic initiatives.Adtalem's operational excellence strategy, Growth with Purpose, has driven six consecutive quarters of enrollment growth while supporting its mission to develop skilled healthcare professionals. Furthermore, strong demand at Chamberlain University and Walden University drove results. ATGE now expects fiscal 2025 adjusted earnings to be in the band of $6.10-$6.30 per share compared with the earlier prediction of $5.75-$5.95.Las Vegas Sands Corp. LVS reported fourth-quarter 2024 results, with earnings missing the Zacks Consensus Estimate and net revenues beating the same. The metrics declined on a year-over-year basis.The company reported solid financial and operational performance at Marina Bay Sands, Singapore and continued recovery in the Macao market. LVS continues to execute its strategic objectives and remains optimistic about achieving industry-leading growth in both Macao and Singapore through its ongoing capital investment initiatives. It is optimistic about the introduction of new suite offerings, enhanced service levels and increased tourism spending in Asia.Royal Caribbean Cruises Ltd. RCL posted mixed fourth-quarter 2024 results, with adjusted earnings beating the Zacks Consensus Estimate while revenues missed the same. Notably, the top and bottom lines increased on a year-over-year basis.The company’s performance during the quarter was driven by stronger pricing on close-in demand and continued strength in onboard revenues. Its diversified fleet offerings, accompanied by its commercial and vacation experiences, are witnessing robust demand trends amid an improving global market backdrop. Thanks to these tailwinds, RCL could achieve its Trifecta goals before the schedule, pointing out the benefits it is realizing from the current improving scenario.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Royal Caribbean Cruises Ltd. (RCL): Free Stock Analysis Report Mattel, Inc. (MAT): Free Stock Analysis Report Las Vegas Sands Corp. (LVS): Free Stock Analysis Report Adtalem Global Education Inc. (ATGE): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks