Mattel Reports $18.2 Million Net Loss in Q2 2026 Despite 10% Sales Increase

Mattel Inc. reported a net loss of $18.2 million for the second quarter of 2026, a significant decline from a net income of $53.4 million in the same period last year. This resulted in a loss per share of $0.06, compared to earnings of $0.16 per share in the prior year. The company's net sales increased by 10% to $1.13 billion, up from $1.02 billion in the second quarter of 2025, driven by a rise in gross billings, which reached $1.27 billion, reflecting a 10% increase year-over-year. However, the gross profit margin fell to 48.2% from 50.9%, attributed to rising costs from tariffs, inflation, and higher royalties.

In the first half of 2026, Mattel's net sales totaled $1.99 billion, an 8% increase from $1.85 billion in the first half of 2025. The increase was primarily due to a rise in gross billings of $164.1 million, although sales adjustments also increased by $21.8 million. The company reported a net income of $42.8 million for the first half, compared to $13 million in the same period last year. The gross margin for the first half decreased to 46.7% from 50.2%, impacted by tariff costs and inflation.

Strategically, Mattel completed the acquisition of the remaining 50% equity interest in Mattel163, a mobile games studio, for $178.6 million in March 2026. This acquisition is expected to enhance Mattel's digital games business and align with its broader product roadmap. The company also continued its share repurchase program, spending approximately $300 million in the first half of 2026, contributing to a decrease in stockholders' equity to $2 billion from $2.23 billion at the end of 2025.

Operationally, Mattel's North America segment saw net sales increase by 12% to $574.3 million, while the International segment reported a 9% increase to $551 million. However, segment income for North America decreased by 2% to $92 million, and the International segment's income fell by 29% to $81.9 million, primarily due to increased costs. The company reported a total employee headcount of approximately 30,000 as of June 30, 2026.

Looking ahead, Mattel anticipates continued challenges from inflation and market conditions, which may impact consumer demand. The company is focused on optimizing operations and leveraging artificial intelligence across its systems and supply chain. Mattel's management remains cautious about the geopolitical and macroeconomic environment, which could materially affect its financial performance in the future.