UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________________________________

FORM 10-Q

___________________________________________________________

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 3031, ~~2024~~2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
			For the transition period from to

Commission File Number 001-05647

___________________________________________________________

MATTEL, INC.

(Exact name of registrant as specified in its charter)

___________________________________________________________


Delaware						95-1567322
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


333 Continental Blvd.		90245-5012
El Segundo,	CA
(Address of principal executive offices)		(Zip Code)

(310) 252-2000

(Registrant's telephone number, including area code)

NONE

(Former name, former address and former fiscal year, if changed since last report)

__________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, $1.00 per share

MAT

The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares outstanding of registrant's common stock, $1.00 par value, as of ~~October 14~~April 21, ~~2024~~2025: ~~336~~322.9 million shares

MATTEL, INC. AND SUBSIDIARIES

		Page
	PART I — FINANCIAL INFORMATION
Item 1.	Financial Statements	4
	Consolidated Balance Sheets	4
	Consolidated Statements of Operations	5
	Consolidated Statements of Comprehensive Income (Loss)	6
	Consolidated Statements of Cash Flows	7
	Consolidated Statements of Stockholders' Equity	8
	Notes to Consolidated Financial Statements	9
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	4538
Item 4.	Controls and Procedures	4639
	PART II — OTHER INFORMATION
Item 1.	Legal Proceedings	4740
Item 1A.	Risk Factors	4740
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	4741
Item 3.	Defaults Upon Senior Securities	4741
Item 4.	Mine Safety Disclosures	4741
Item 5.	Other Information	4741
Item 6.	Exhibits	4842
	Signature	4943

(Cautionary Note Regarding Forward-Looking Statements)

Mattel cautions investors that this Quarterly Report on Form 10-Q includes forward-looking statements, which are statements that relate to the future and are, by their nature, uncertain. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. The use of words such as "anticipates," "expects," "intends," "plans," "projects," "looks forward," "confident that," "believes," and "targeted," among others, generally identify forward-looking statements. These forward-looking statements are based on currently available operating, financial, economic, and other information and assumptions, and are subject to a number of significant risks and uncertainties. A variety of factors or combination of factors, many of which are beyond Mattel's control, ~~could~~may cause actual future results or outcomes, or the timing of those results or outcomes, to differ materially from those ~~projected~~contained in ~~the~~any forward-looking statements. Specific factors that might cause such a difference include, but are not limited to: (i) Mattel's ability to design, develop, produce, manufacture, source, ship, and distribute products onin a timely and cost-effective ~~basis~~manner; (ii) sufficient interest in and demand for the products and entertainment Mattel offers by retail customers and consumers to profitably recover Mattel's costs; (iii) downturns in economic conditions affecting Mattel's markets which can negatively impact retail customers and consumers, and which can result in lower employment levels and lower consumer disposable income and spending, including lower spending on purchases of Mattel's products; (iv) other factors which can lower discretionary consumer spending, such as higher costs for fuel and food, drops in the value of homes or other consumer assets, and high levels of consumer debt; (v) potential difficulties or delays Mattel may experience in implementing cost savings and efficiency enhancing initiatives; (vi) other economic and public health conditions or regulatory changes in the markets in which Mattel and its customers and suppliers operate, which could create delays or increase Mattel's costs, such as higher commodity prices, labor costs or transportation costs, or outbreaks of disease; (vii) the effect of inflation on Mattel's business, including cost inflation in supply chain inputs and increased labor costs, as well as pricing actions taken in an effort to mitigate the effects of inflation; (viii) currency fluctuations, including movements in foreign exchange rates, which can lower Mattel's net revenues and earnings, and significantly impact Mattel's costs; (ix) the concentration of Mattel's customers, potentially increasing the negative impact to Mattel of difficulties experienced by any of Mattel's customers, such as bankruptcies or liquidations or a general lack of success, or changes in their purchasing or selling patterns; (x) the inventory policies of Mattel's retail customers, as well as the concentration of Mattel's revenues in the second half of the year, which coupled with reliance by retailers on quick response inventory management techniques, increases the risk of underproduction, overproduction, and shipping delays; (xi) legal, reputational, and financial risks related to security breaches or cyberattacks; (xii) work disruptions, including as a result of supply chain disruption such as plant or port closures, which may impact Mattel's ability to manufacture or deliver product in a timely and cost-effective manner; (xiii) the impact of competition on revenues, margins, and other aspects of Mattel's business, including the ability to offer products that consumers choose to buy instead of competitive products, the ability to secure, maintain, and renew popular licenses from licensors of entertainment properties, and the ability to attract and retain talented employees and adapt to evolving workplace models; (xiv) the risk of product recalls or product liability suits and costs associated with product safety regulations; (xv) tariffs, trade restrictions, or trade barriers, which depending on the effective date and duration of such measures, changes in the amount, scope, and nature of such measures in the future, any countermeasures that the target countries may take, and any mitigating actions that may become available, could increase Mattel's product costs and other costs of doing business, and other changes in laws or regulations in the United States and/or in other major markets, such as China, in which Mattel operates, including, without limitation, with respect to taxes, ~~tariffs,~~ trade policies, product safety, or sustainability, which may also increase Mattel's product costs and other costs of doing business, and in each case reduce Mattel's earnings and liquidity; (xvi) business disruptions or other unforeseen impacts due to economic instability, political instability, civil unrest, armed hostilities (including the impact of the ~~war in~~ Russia-Ukraine war and geopolitical developments in the Middle East) or terrorist activities, natural and man-made disasters, pandemics or other public health crises, or other catastrophic events; (xvii) failure to realize the planned benefits from any investments or acquisitions made by Mattel; (xviii) the impact of other market conditions or third-party actions or approvals, including those that result in any significant failure, inadequacy, or interruption from vendors or outsourcers, which could reduce demand for Mattel's products, delay or increase the cost of implementation of Mattel's programs, or alter Mattel's actions and reduce actual results; (xix) changes in financing markets or the inability of Mattel to obtain financing on attractive terms; (xx) the impact of litigation, arbitration, or regulatory decisions or settlement actions; (xxi) Mattel's ability to navigate regulatory frameworks in connection with new areas of investment, product development, or other business activities, such as artificial intelligence, non-fungible tokens, and cryptocurrency; (xxii) an inability to remediate the material weakness in Mattel's internal control over financial reporting, or additional material weaknesses or other deficiencies in the future or the failure to maintain an effective system of internal control; and (xxiii) other risks and uncertainties detailed in Part I, Item 1A "Risk Factors" in Mattel's Annual Report on Form 10-K for the fiscal year ended December 31, ~~2023~~2024 (the "~~2023~~2024 Annual Report on Form 10-K"), Item 1A "Risk Factors" in this Quarterly Report on Form 10-Q, and subsequent periodic filings. Mattel does not update forward-looking statements and expressly disclaims any obligation to do so, except as required by law.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

September 30,2024

September 30,2023

December 31,2023

March 31,2025

March 31,2024

December 31,2024

(Unaudited; in thousands, except share data)

ASSETS

Current Assets

Cash and equivalents

~~723~~1,~~532~~243,696

~~455~~1,~~735~~130,223

1,~~261~~387,~~363~~908

Accounts receivable, net of allowances for credit losses of $8.2 million, $12.5 million, and $8.8 million, respectively

1,477,364

1,571,047

1,081,827

Accounts receivable, net of allowances for credit losses of $7.9 million, $8.7 million, and $8.2 million, respectively

633,310

673,270

1,003,178

Inventories

~~737~~658,~~182~~420

~~790~~669,~~521~~335

~~571~~501,~~609~~732

Prepaid expenses and other current assets

~~242~~251,~~302~~097

~~224~~262,~~796~~668

~~207~~234,~~548~~099

Total current assets

32,~~180~~786,~~380~~523

32,~~042~~735,~~099~~496

3,~~122~~126,~~347~~917

Noncurrent Assets

Property, plant, and equipment, net

~~513~~515,~~769~~890

~~457~~452,~~202~~220

~~465~~516,~~523~~049

Right-of-use assets, net

~~277~~315,~~627~~818

~~286~~308,~~019~~456

~~313~~326,~~191~~394

Goodwill

1,~~388~~385,~~991~~063

1,~~380~~383,~~042~~757

1,~~384~~381,~~512~~721

Deferred income tax assets

~~260~~304,~~180~~059

~~230~~304,~~415~~240

~~299~~296,~~157~~862

Intangible assets, net

374,706

397,821

393,039

Identifiable intangible assets, net

355,902

384,306

360,563

Other noncurrent assets

~~518~~543,~~080~~185

~~450~~496,~~956~~897

~~458~~535,~~053~~578

Total Assets

6,~~513~~206,~~733~~440

6,~~244~~065,~~554~~372

6,~~435~~544,~~822~~084

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

Accounts payable

~~439~~318,~~203~~315

~~450~~315,~~109~~346

~~442~~398,~~286~~983

Accrued liabilities

~~803~~813,~~204~~422

~~803~~768,~~081~~840

~~866~~878,~~283~~710

Income taxes payable

5615,~~212~~047

5114,~~366~~925

3338,~~911~~030

Total current liabilities

1,~~298~~146,~~619~~784

1,~~304~~099,~~556~~111

1,~~342~~315,~~480~~723

Noncurrent Liabilities

Long-term debt

2,~~333~~335,~~260~~442

2,~~328~~331,~~897~~078

2,~~329~~334,~~986~~351

Noncurrent lease liabilities

~~229~~263,~~223~~993

~~234~~256,~~699~~200

~~259~~278,~~548~~174

Other noncurrent liabilities

~~339~~330,~~685~~641

~~340~~353,~~936~~671

~~354~~351,~~595~~711

Total noncurrent liabilities

2,~~902~~930,~~168~~076

2,~~904~~940,~~532~~949

2,~~944~~964,~~129~~236

Stockholders' Equity

Common stock $1.00 par value, 1.00 billion shares authorized; 441.4 million shares issued

441,369

Additional paid-in capital

1,~~759~~792,~~000~~404

1,~~745~~772,~~170~~154

1,~~774~~780,~~911~~259

Treasury stock at cost: 104.5 million shares, 88.1 million shares, and 92.9 million shares, respectively

(2,434,734)

(2,131,676)

(2,224,160)

Treasury stock at cost: 118.5 million shares, 97.3 million shares, and 111.4 million shares, respectively

(2,721,165)

(2,306,258)

(2,566,929)

Retained earnings

3,~~463~~563,~~016~~559

23,~~914~~033,~~744~~780

3,~~062~~603,~~061~~878

Accumulated other comprehensive loss

(~~915~~946,~~705~~587)

(~~934~~915,~~141~~733)

(~~904~~994,~~968~~452)

Total stockholders' equity

2,~~312~~129,~~946~~580

2,~~035~~025,~~466~~312

2,~~149~~264,~~213~~125

Total Liabilities and Stockholders' Equity

6,~~513~~206,~~733~~440

6,~~244~~065,~~554~~372

6,~~435~~544,~~822~~084

The accompanying notes are an integral part of these consolidated financial statements.

MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	~~For the Three Months Ended~~		For the Three Months Ended						~~For the Nine Months Ended~~
	September 30,2024				September 30,2023				September 30,2024		September 30,2023
			March 31,2025				March 31,2024
	~~(Unaudited; in thousands, except per share amounts)~~		(Unaudited; in thousands, except per share amounts)
Net Sales	$	~~1,843,904~~	$	826,629	$	~~1,918,788~~	$	809,508	$	~~3,733,141~~	$	~~3,820,531~~
Cost of sales	~~864,908~~		418,533		~~940,854~~		420,638		~~1,834,539~~		~~2,027,004~~
Gross Profit	~~978,996~~		408,096		~~977,934~~		388,870		~~1,898,602~~		~~1,793,527~~
Advertising and promotion expenses	~~104,956~~		70,198		~~124,265~~		71,441		~~250,117~~		~~290,337~~
Other selling and administrative expenses	~~385,699~~		390,878		~~379,811~~		352,947		~~1,112,455~~		~~1,081,594~~
Operating Income	488,341				473,858				536,030		421,596
Operating Loss			(52,980)				(35,518)
Interest expense	~~29,371~~		29,234		~~30,716~~		30,059		~~89,415~~		~~92,486~~
Interest (income)	~~(9,787)~~		(15,952)		~~(4,569)~~		(17,282)		~~(39,466)~~		~~(15,409)~~
Other non-operating (income) expense, net	(2,924)				(2,391)				8,796		(5,976)
Other non-operating expense, net			13,040				5,613
Income Before Income Taxes	471,681				450,102				477,285		350,495
Loss Before Income Taxes			(79,302)				(53,908)
Provision for income taxes	106,350				309,342				94,756		296,767
(Benefit) from income taxes			(30,565)				(20,790)
(Income) from equity method investments	~~(7,045)~~		(8,418)		~~(5,559)~~		(4,837)		~~(18,426)~~		~~(13,306)~~
Net Income	$	372,376			$	146,319			$	400,955	$	67,034
Net Loss			$	(40,319)			$	(28,281)
Net Income Per Common Share - Basic	$	1.10			$	0.41			$	1.17	$	0.19
Net Loss Per Common Share - Basic			$	(0.12)			$	(0.08)
Weighted-average number of common shares	~~339,059~~		327,493		~~354,139~~		346,888		~~342,707~~		~~354,559~~
Net Income Per Common Share - Diluted	$	1.09			$	0.41			$	1.16	$	0.19
Net Loss Per Common Share - Diluted			$	(0.12)			$	(0.08)
Weighted-average number of common and potential common shares	~~341,216~~		327,493		~~357,474~~		346,888		~~345,380~~		~~357,977~~

The accompanying notes are an integral part of these consolidated financial statements.

MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	For the Three Months Ended				~~For the Nine Months Ended~~
	September 30,2024		September 30,2023		September 30,2024		September 30,2023
	March 31,2025		March 31,2024
	(Unaudited; in thousands)
Net Income	$	372,376	$	146,319	$	400,955	$	67,034
Net Loss	$	(40,319)	$	(28,281)
Other Comprehensive Income (Loss), Net of Tax
Currency translation adjustments	2453,~~442~~618		(3917,~~273~~946)		~~(16,885)~~		~~(8,992)~~
Employee benefit plan adjustments	~~994~~1,285		~~664~~2,198		~~3,441~~		~~2,120~~
Net unrealized gains (losses) on derivative instruments:
Net unrealized (losses) gains on derivative instruments:
Unrealized holding (losses) gains	(139,~~288~~223)		713,~~521~~224		~~9,764~~		~~(1,729)~~
Reclassification adjustments included in net income	72,~~264~~185		(58,~~801~~241)		~~(7,057)~~		~~(14,062)~~
	(6,024)		1,720		2,707		(15,791)
	(7,038)		4,983
Other Comprehensive Income (Loss), Net of Tax	1947,~~412~~865		(3610,~~889~~765)		~~(10,737)~~		~~(22,663)~~
Comprehensive Income	$	391,788	$	109,430	$	390,218	$	44,371
Comprehensive Income (Loss)	$	7,546	$	(39,046)

The accompanying notes are an integral part of these consolidated financial statements.

MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Nine Months Ended
	For the Three Months Ended
	September 30,2024		September 30,2023
	March 31,2025		March 31,2024
	(Unaudited; in thousands)
Cash Flows From Operating Activities:
Net income	$	400,955	$	67,034
Net loss	$	(40,319)	$	(28,281)
Adjustments to reconcile net income to net cash flows used for operating activities:
Adjustments to reconcile net loss to net cash flows provided by operating activities:
Depreciation	~~101~~34,~~682~~016		~~104~~34,~~042~~513
Amortization of intangible assets	237,~~503~~769		287,~~570~~823
Share-based compensation	5719,~~448~~904		5217,~~425~~929
Inventory obsolescence	309,~~023~~032		4216,~~245~~069
Deferred income taxes	23(13,~~020~~100)		26(5,~~283~~157)
Income from equity method investments	(188,~~426~~418)		(134,~~306~~837)
Valuation allowance on foreign deferred tax assets	3,200		212,379
Content assets amortization	18,541		14,239
Content assets amortization	62,333		32,938
Changes in assets and liabilities:
Accounts receivable, net	~~(408~~378,~~662)~~936		~~(714~~398,~~198)~~921
Inventories	(~~201~~149,~~954~~910)		42(123,~~701~~718)
Prepaid expenses and other current assets	(4222,~~695~~727)		(447,~~768~~835)
Accounts payable, accrued liabilities, and income taxes payable	(32181,~~262~~076)		~~121~~(226,~~202~~543)
Content assets spend	(162,~~944~~733)		(477,~~111~~161)
Other, net	(4225,~~804~~101)		(3010,~~077~~467)
Net cash flows used for operating activities	(61,583)		(79,641)
Net cash flows provided by operating activities	24,814		35,495
Cash Flows From Investing Activities:
Purchases of tools, dies, and molds	(4815,~~337~~371)		(5615,~~741~~759)
Purchases of other property, plant, and equipment	(~~108~~20,~~598~~823)		(6014,~~797~~713)
Proceeds from foreign currency forward exchange contracts, net	13,~~578~~784		201,~~021~~829
Other, net	31,~~617~~088		~~3,605~~209
Net cash flows used for investing activities	(~~151~~31,~~740~~322)		(9328,~~912~~434)
Cash Flows From Financing Activities:
Share repurchases	(~~268~~160,~~307~~000)		(~~109~~99,~~860~~999)
Tax withholdings for share-based compensation	(172,~~375~~208)		(326,~~822~~165)
Proceeds from stock option exercises	61,~~184~~668		264,~~014~~299
Other, net	(341,~~730~~378)		(229,~~783~~463)
Net cash flows used for financing activities	(~~314~~161,~~228~~918)		(~~119~~131,~~451~~328)
Effect of Currency Exchange Rate Changes on Cash and Equivalents	~~(10~~24,~~280)~~214		(126,~~496~~873)
Change in Cash and Equivalents	(~~537~~144,~~831~~212)		(~~305~~131,~~500~~140)
Cash and Equivalents at Beginning of Period	1,~~261~~387,~~363~~908		~~761~~1,~~235~~261,363
Cash and Equivalents at End of Period	$	~~723~~1,~~532~~243,696	$	~~455~~1,~~735~~130,223

The accompanying notes are an integral part of these consolidated financial statements.

MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

	CommonStock		AdditionalPaid-InCapital		TreasuryStock		RetainedEarnings		AccumulatedOtherComprehensiveLoss		TotalStockholders'Equity
	(Unaudited; in thousands)
Balance, December 31, 2024	$	441,369	$	1,780,259	$	(2,566,929)	$	3,603,878	$	(994,452)	$	2,264,125
Net loss	—		—		—		(40,319)		—		(40,319)
Other comprehensive income, net of tax	—		—		—		—		47,865		47,865
Share repurchases	—		—		(161,440)		—		—		(161,440)
Issuance of treasury stock for stock option exercises	—		(1,151)		2,819		—		—		1,668
Issuance of treasury stock for restricted stock units vesting	—		(6,535)		4,312		—		—		(2,223)
Deferred compensation	—		(73)		73						—
Share-based compensation	—		19,904		—		—		—		19,904
Balance, March 31, 2025	$	441,369	$	1,792,404	$	(2,721,165)	$	3,563,559	$	(946,587)	$	2,129,580
	CommonStock		AdditionalPaid-InCapital		TreasuryStock		RetainedEarnings		AccumulatedOtherComprehensiveLoss		TotalStockholders'Equity
	(Unaudited; in thousands)
Balance, December 31, 2023	$	441,369	$	1,774,911	$	(2,224,160)	$	3,062,061	$	(904,968)	$	2,149,213
Net loss	—		—		—		(28,281)		—		(28,281)
Other comprehensive loss, net of tax	—		—		—		—		(10,765)		(10,765)
Share repurchases	—		—		(100,758)		—		—		(100,758)
Issuance of treasury stock for stock option exercises	—		(2,754)		7,053		—		—		4,299
Issuance of treasury stock for restricted stock units vesting	—		(17,932)		11,607		—		—		(6,325)
Share-based compensation	—		17,929		—		—		—		17,929
Balance, March 31, 2024	$	441,369	$	1,772,154	$	(2,306,258)	$	3,033,780	$	(915,733)	$	2,025,312
Net income	—		—		—		56,860		—		56,860
Other comprehensive loss, net of tax	—		—		—		—		(19,384)		(19,384)
Share repurchases	—		—		(100,954)		—		—		(100,954)
Issuance of treasury stock for stock option exercises	—		(437)		953		—		—		516
Issuance of treasury stock for restricted stock units vesting	—		(35,743)		26,692		—		—		(9,051)
Deferred compensation	—		(148)		148		—		—		—
Share-based compensation	—		19,834		—		—		—		19,834
Balance, June 30, 2024	$	441,369	$	1,755,660	$	(2,379,419)	$	3,090,640	$	(935,117)	$	1,973,133
Net income	—		—		—		372,376		—		372,376
Other comprehensive income, net of tax	—		—		—		—		19,412		19,412
Share repurchases	—		—		(68,907)		—		—		(68,907)
Issuance of treasury stock for stock option exercises	—		(1,186)		2,556		—		—		1,370
Issuance of treasury stock for restricted stock units vesting	—		(15,159)		11,036		—		—		(4,123)
Share-based compensation	—		19,685		—		—		—		19,685
Balance, September 30, 2024	$	441,369	$	1,759,000	$	(2,434,734)	$	3,463,016	$	(915,705)	$	2,312,946
	CommonStock		AdditionalPaid-InCapital		TreasuryStock		RetainedEarnings		AccumulatedOtherComprehensiveLoss		TotalStockholders'Equity
	(Unaudited; in thousands)
Balance, December 31, 2022	$	441,369	$	1,808,308	$	(2,129,639)	$	2,847,709	$	(911,478)	$	2,056,269
Net loss	—		—		—		(106,471)		—		(106,471)
Other comprehensive income, net of tax	—		—		—		—		23,160		23,160
Share repurchases	—		—		(33,986)		—		—		(33,986)
Issuance of treasury stock for stock option exercises	—		(1,144)		3,189		—		—		2,045
Issuance of treasury stock for restricted stock units vesting	—		(51,311)		31,012		—		—		(20,299)
Share-based compensation	—		16,943		—		—		—		16,943
Balance, March 31, 2023	$	441,369	$	1,772,796	$	(2,129,424)	$	2,741,238	$	(888,318)	$	1,937,661
Net income	—		—		—		27,187		—		27,187
Other comprehensive loss, net of tax	—		—		—		—		(8,934)		(8,934)
Share repurchases	—		—		(15,875)		—		—		(15,875)
Issuance of treasury stock for stock option exercises	—		(4,075)		10,670		—		—		6,595
Issuance of treasury stock for restricted stock units vesting	—		(18,079)		13,698		—		—		(4,381)
Deferred compensation	—		(36)		166		—		—		130
Share-based compensation	—		19,991		—		—		—		19,991
Balance, June 30, 2023	$	441,369	$	1,770,597	$	(2,120,765)	$	2,768,425	$	(897,252)	$	1,962,374
Net income	—		—		—		146,319		—		146,319
Other comprehensive loss, net of tax	—		—		—		—		(36,889)		(36,889)
Share repurchases	—		—		(60,000)		—		—		(60,000)
Issuance of treasury stock for stock option exercises	—		(10,095)		27,469		—		—		17,374
Issuance of treasury stock for restricted stock units vesting	—		(30,824)		21,620		—		—		(9,204)
Share-based compensation	—		15,492		—		—		—		15,492
Balance, September 30, 2023	$	441,369	$	1,745,170	$	(2,131,676)	$	2,914,744	$	(934,141)	$	2,035,466

The accompanying notes are an integral part of these consolidated financial statements.

MATTEL, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Basis of Presentation

The accompanying unaudited consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States ~~of America~~ ("GAAP") applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair statement of the financial position and interim results of Mattel, Inc. and its subsidiaries ("Mattel") as of and for the periods presented have been included.

The December 31, ~~2023~~2024 balance sheet data was derived from audited financial statements; however, the accompanying interim notes to the consolidated financial statements do not include all of the annual disclosures required by GAAP. As Mattel's business is seasonal, results for interim periods are not necessarily indicative of those that may be expected for a full year. The financial information included herein should be read in conjunction with Mattel's consolidated financial statements and related notes in the ~~2023~~2024 Annual Report on Form 10-K.

Certain prior period amounts have been reclassified to conform to the current period presentation.

2. Accounts Receivable, Net

Mattel estimates current expected credit losses based on collection history and management's assessment of the current economic trends, business environment, customers' financial condition, ~~and~~ accounts receivable aging, and customer disputes that may impact the level of future credit losses. Accounts receivable were net of allowances for credit losses of $87.29 million, $128.57 million, and $8.82 million as of ~~September~~March 3031, ~~2024~~2025, ~~September~~March 3031, ~~2023~~2024, and December 31, ~~2023~~2024, respectively.

3. Inventories

Inventories included the following:

September 30,2024

September 30,2023

December 31,2023

March 31,2025

March 31,2024

December 31,2024

(In thousands)

Raw materials and work in process

~~109~~110,~~335~~617

~~102~~97,~~582~~116

9294,~~902~~755

Finished goods

~~627~~547,~~847~~803

~~687~~572,~~939~~219

~~478~~406,~~707~~977

~~737~~658,~~182~~420

~~790~~669,~~521~~335

~~571~~501,~~609~~732

4. Property, Plant, and Equipment, Net

Property, plant, and equipment, net included the following:

September 30,2024

September 30,2023

December 31,2023

March 31,2025

March 31,2024

December 31,2024

(In thousands)

Land

42,~~924~~558

19,~~566~~590

1942,~~838~~584

Buildings

~~357~~352,~~969~~744

~~311~~312,~~030~~034

~~313~~350,~~750~~920

Machinery and equipment

~~641~~614,~~999~~004

623,~~687~~141

~~628~~605,~~089~~311

Software

234,~~928~~823

~~232~~233,~~995~~655

~~233~~234,~~224~~699

Tools, dies, and molds

~~501~~486,~~220~~670

~~494~~495,~~070~~158

~~488~~476,~~170~~551

Leasehold improvements

~~120~~107,~~929~~924

~~123~~119,~~240~~777

~~121~~107,~~571~~139

Construction in progress

4261,~~243~~065

39,~~533~~266

4862,~~483~~130

1,942,212

1,844,121

1,853,125

1,899,788

1,842,621

1,879,334

Less: accumulated depreciation

(1,~~428~~383,~~443~~898)

(1,~~386~~390,~~919~~401)

(1,~~387~~363,~~602~~285)

~~513~~515,~~769~~890

~~457~~452,~~202~~220

~~465~~516,~~523~~049

In July 2024, Mattel completed the purchase of an office building located in El Segundo, California for cash consideration of ~~approximately~~ $5958.8 million. The building totals approximately 168,000 square feet and, upon completion of an interior build-out, will replace a currently leased facility that supports Mattel's global design and development and other activities. The building will support the North America and International segments.

5. Goodwill and Identifiable Intangible Assets, Net

Goodwill

~~Goodwill~~Mattel's isreporting ~~allocated~~units toare ~~various~~(i) ~~reporting~~North ~~units~~America, ~~for~~which consists of the ~~purpose~~United ofStates ~~evaluating~~and ~~whether~~Canada, ~~goodwill~~(ii) International, and (iii) American Girl. Goodwill related to the American Girl reporting unit is ~~impaired~~included in the North America operating segment. Mattel's ~~reporting~~reportable ~~units~~segments are: (i) North America; ~~(ii) American Girl;~~ and (~~iii~~ii) International. ~~Components~~Certain components of the ~~reporting~~operating ~~units~~segments have been aggregated into a single reporting ~~units~~unit ~~where~~as the components have similar economic characteristics. The similar economic characteristics include the nature of the products, the nature of the production processes, the customers, and the manner in which the products are distributed. Mattel tests its goodwill for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying amount of a reporting unit may exceed its fair value.

~~Mattel~~The ~~performed~~change ain ~~quantitative~~the ~~goodwill~~carrying ~~impairment~~amount ~~assessment as~~ of ~~August 1, 2024, and determined that~~ goodwill ~~was~~by ~~not~~reporting ~~impaired.~~unit ~~The~~for ~~quantitative~~the ~~goodwill~~three ~~impairment~~months ~~assessment~~ended ~~includes~~March 31, ~~the~~2025 ~~use~~is ofshown ~~certain~~below. ~~assumptions~~Goodwill ~~and~~is ~~estimates~~allocated to ~~calculate the estimated fair value of Mattel’s~~ reporting units. Toat the ~~extent~~acquisition ~~assumptions,~~date ~~estimations,~~based orupon ~~market factors, including seasonality, differ from Mattel’s current estimates,~~ the ~~estimated~~expected ~~fair~~benefits ~~value of Mattel’s reporting units may be susceptible~~ to ~~significant~~those ~~changes. The~~ reporting ~~unit that is most susceptible to changes in assumptions and estimates given its smaller size is American Girl~~units, asthereby ~~excess~~causing ~~fair~~foreign ~~value~~currency ~~over~~translation ~~carrying value is a lesser dollar and percentage value than the other reporting units~~impact.

The change in the carrying amount of goodwill by reporting unit for the nine months ended September 30, 2024 is shown below. Brand-specific goodwill held by foreign subsidiaries is allocated to the North America reporting unit selling those brands, resulting in a foreign currency exchange rate impact.


	December 31, 2024		Currency Exchange Rate Impact		March 31, 2025
	(In thousands)
North America	$	732,995	$	927	$	733,922
International	441,155		2,415		443,570
American Girl	207,571		—		207,571
	$	1,381,721	$	3,342	$	1,385,063

	December 31,2023		CurrencyExchange RateImpact		September 30,2024
	(In thousands)
North America	$	733,487	$	1,490	$	734,977
American Girl	207,571		—		207,571
International	443,454		2,989		446,443
	$	1,384,512	$	4,479	$	1,388,991

Identifiable Intangible Assets, Net

~~Intangible~~Mattel's ~~Assets~~identifiable intangible assets, ~~Net~~net consisted of the following:

Identifiable intangible assets were $374.7 million, net of accumulated amortization of $435.1 million, $397.8 million, net of accumulated amortization of $396.8 million, and $393.0 million, net of accumulated amortization of $408.5 million as of September 30, 2024, September 30, 2023, and December 31, 2023, respectively.


	March 31, 2025		March 31, 2024		December 31, 2024
	(In thousands)
Identifiable intangibles	$	803,872	$	800,092	$	798,655
Less: accumulated amortization	(447,970)		(415,786)		(438,092)
	$	355,902	$	384,306	$	360,563

Mattel's amortizable intangible assets primarily consist of trademarks and trade names. Mattel tests its amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Mattel's amortizable intangible assets were not impaired during the three ~~and nine~~ months ended ~~September~~March 3031, ~~2024~~2025 and ~~2023~~2024.

6. Accrued Liabilities

Accrued liabilities included the following:

	September 30,2024		September 30,2023		December 31,2023
	March 31,2025		March 31,2024		December 31,2024
	(In thousands)
Incentive compensation	$	~~104~~166,~~136~~016	$	89155,~~142~~228	$	~~143~~157,~~091~~699
Royalties	80,141		74,801		86,475
Lease liabilities	80,808		76,976		74,755
Lease liabilities	74,871		76,021		77,254
Royalties	55,174		34,942		80,754
Advertising and promotion	7154,~~993~~505		~~105~~57,~~218~~082		~~102~~120,~~217~~290

7. Supplier Finance Program

Mattel has an agreement with a third-party financial institution that allows certain participating suppliers the opportunity to voluntarily finance payment obligations of Mattel under a supplier finance program. Under this program, participating suppliers may accelerate the timing of collection of their receivables due from Mattel, prior to their scheduled due dates, by selling one or more of their receivables at a discounted price to the third-party financial institution. The range of payment terms Mattel negotiates with suppliers are consistent, regardless of whether the suppliers participate in the supplier finance program and Mattel does not have any economic interest in any suppliers' decision to participate in the supplier finance program. Suppliers participating in the program are able to select which individual Mattel invoices they sell to the third-party financial institution. All Mattel payments of the full amounts due to participating suppliers are paid on the invoice due date based on the terms originally negotiated with the supplier, regardless of whether the individual invoice due to the supplier is sold to the third-party financial institution. Included in Mattel's accounts payable in the consolidated balance sheets as of each of ~~September~~March 3031, ~~2024~~2025, ~~September~~March 3031, ~~2023~~2024, and December 31, ~~2023~~2024 were $~~112~~69.37 million, $9053.54 million, and $5469.32 million of outstanding payment obligations due to suppliers, respectively, under the supplier finance program. All payment activities related to the supplier finance program were presented within operating activities in the consolidated statements of cash flows.

8. Seasonal Financing

On July 15, 2024, Mattel entered into a revolving credit agreement (the "~~New~~ Credit Agreement"), among Mattel, as the borrower, Bank of America, N.A., as administrative agent, and the other lenders and financial institutions party thereto, providing for $1.40 billion in aggregate principal amount of senior unsecured revolving credit facilities (the "~~New Revolving~~ Credit Facility"). The ~~New Revolving~~ Credit Facility matures on July 15, 2029. In connection with the ~~New Revolving~~ Credit Facility, Mattel terminated the commitments and satisfied all outstanding obligations under ~~the~~Mattel's prior revolving credit agreement ~~(the "Prior Credit Agreement")~~, dated as of September 15, 2022 (as amended), among Mattel, as the borrower, Bank of America, N.A., as administrative agent, and the other lenders and financial institutions party thereto, which provided for a senior secured revolving credit facility in an aggregate principal amount of $1.40 billion ~~(the "Prior Revolving Credit Facility")~~.

AsBorrowings ofunder ~~September 30,~~the ~~2024,~~Credit ~~Mattel~~Facility ~~was~~bear ininterest ~~compliance~~at ~~with~~a ~~all~~floating ~~covenants~~rate, ~~contained~~which infor ~~the New Credit Agreement~~U.S. ~~Mattel~~Dollar-denominated ~~had~~loans nocan ~~borrowings~~be, ~~outstanding~~at ~~under~~Mattel's ~~the~~option, ~~New~~either ~~Revolving~~(a) ~~Credit~~Term ~~Facility~~SOFR ~~and no other short-term borrowings outstanding~~ (as ofdefined ~~September 30,~~in ~~2024. Under~~ the ~~Prior Revolving~~ Credit ~~Facility~~Agreement), ~~Mattel~~plus ~~had~~an noapplicable ~~borrowings~~margin ~~outstanding~~ranging ~~and~~from no0.875% ~~other~~to ~~short-term~~1.375% ~~borrowings~~per ~~outstanding as of September 30~~annum, ~~2023,~~or ~~and~~(b) ~~December 31,~~Base ~~2023.~~Rate ~~Outstanding~~(as ~~letters~~defined ofin ~~credit under~~ the ~~New Revolving~~ Credit ~~Facility~~Agreement), ~~totaled~~plus ~~approximately~~an ~~$9 million~~applicable asmargin ofranging ~~September 30,~~from ~~2024~~0.000% ~~Outstanding~~to ~~letters~~0.375% ofper ~~credit~~annum, ~~under~~in ~~the~~each ~~Prior~~case, ~~Revolving~~such ~~Credit~~applicable ~~Facility~~margins ~~totaled~~to ~~approximately~~be $9determined ~~million~~based ason ofMattel's ~~each~~debt ~~of September 30, 2023, and December 31, 2023~~rating.

~~Borrowings~~In ~~under~~addition ~~the~~to ~~New~~paying ~~Revolving Credit Facility will bear~~ interest aton athe ~~floating~~outstanding ~~rate,~~principal ~~which~~under ~~for~~the ~~U.S.~~Credit ~~Dollar-denominated loans can be~~Facility, at Mattel's ~~option,~~is ~~either~~required ~~(a)~~to ~~Term~~pay ~~SOFR~~ (asi) ~~defined~~an inunused ~~the~~line ~~New~~fee ~~Credit~~per ~~Agreement),~~annum ~~plus~~of anthe ~~applicable~~average ~~margin~~daily ~~ranging~~unused ~~from~~portion ~~0.875%~~of tothe ~~1.375%~~Credit ~~per annum~~Facility, or (bii) ~~Base~~a ~~Rate~~letter ~~(as~~of ~~defined~~credit infronting ~~the~~fee ~~New~~based ~~Credit~~on ~~Agreement),~~a ~~plus~~percentage anof ~~applicable~~the ~~margin~~aggregate ~~ranging~~face ~~from~~amount ~~0.000%~~of tooutstanding ~~0.375%~~letters ~~per~~of ~~annum~~credit, inand ~~each~~(iii) ~~case,~~certain ~~such~~other ~~applicable~~customary ~~margins~~fees toand beexpenses ~~determined~~of ~~based~~the onlenders ~~Mattel's~~and ~~debt rating~~agents.

InThe ~~addition~~Credit Agreement contains customary covenants, including, but not limited to, ~~paying~~(a) ~~interest~~restrictions on ~~the~~Mattel's ~~outstanding~~and ~~principal~~its ~~under~~subsidiaries' ~~the~~ability ~~New~~to ~~Revolving~~merge ~~Credit~~and ~~Facility~~consolidate with other companies, ~~Mattel~~dispose ~~will~~of beall ~~required~~or tosubstantially ~~pay~~all ~~(i)~~assets, anincur ~~unused~~indebtedness, ~~line~~or ~~fee~~grant ~~per~~liens ~~annum~~or ofother security interests on assets, in each case, subject to certain customary exceptions and (b) the ~~average~~requirement ~~daily~~that ~~unused~~the ~~portion~~obligations of ~~the~~Mattel ~~New~~under ~~Revolving~~the Credit Facility, ~~(ii)~~be aguaranteed ~~letter~~by ofany ~~credit~~existing ~~fronting~~or ~~fee~~future ~~based~~direct onor aindirect ~~percentage~~domestic subsidiary of ~~the~~Mattel ~~aggregate~~that ~~face~~guarantees ~~amount~~other indebtedness of ~~outstanding~~Mattel ~~letters~~in an aggregate principal or committed amount in excess of ~~credit~~$50 million, ~~and~~subject ~~(iii)~~to certain ~~other~~ customary ~~fees~~exceptions. ~~and~~As ~~expenses~~of March 31, 2025, no subsidiaries of ~~the~~Mattel ~~lenders~~were ~~and~~required ~~agents.~~to guarantee the Credit Facility.

The ~~New~~ Credit Agreement ~~contains~~requires ~~customary~~the ~~covenants,~~maintenance ~~including,~~of ~~but~~(a) an interest coverage ratio of not ~~limited~~less than 2.75 to, ~~restrictions~~1.00 onas ~~Mattel's~~of ~~and~~the ~~its~~end ~~subsidiaries'~~of ~~ability~~each tofiscal ~~merge~~quarter and ~~consolidate~~(b) ~~with~~a ~~other~~total ~~companies,~~leverage ~~dispose~~ratio as of ~~all~~the orend ~~substantially~~of ~~all~~each ~~assets~~fiscal quarter, ~~incur~~not ~~indebtedness,~~to orexceed ~~grant~~(x) ~~liens~~3.75 orto ~~other~~1.00 ~~security~~with ~~interests~~respect to fiscal quarters ending on ~~assets~~March 31, inJune 30 and December 31 of each ~~case~~year, ~~subject~~and to(y) ~~certain~~4.00 ~~customary~~to ~~exceptions~~1.00 Nowith ~~subsidiaries~~respect to fiscal quarters ending on September 30 of ~~Mattel~~each ~~were~~year. ~~required~~The total leverage ratio financial covenant is subject to ~~guarantee~~a ~~the~~step-up ~~New~~to ~~Revolving~~4.25 ~~Credit~~to ~~Facility~~1.00, aswith respect to fiscal quarters in which certain material acquisitions are consummated, and for a period of ~~the~~four ~~closing~~fiscal ~~date~~quarters ~~thereof~~thereafter, and subject to certain customary exceptions.

~~The~~As ~~New~~of ~~Credit~~March 31, ~~Agreement~~2025, ~~requires~~Mattel ~~the~~was ~~maintenance~~in ofcompliance ~~(a)~~with anall ~~interest~~covenants ~~coverage~~contained ~~ratio~~in ofthe ~~not~~Credit ~~less~~Agreement. ~~than~~Mattel ~~2.75~~had tono ~~1.00~~borrowings asoutstanding ofunder the ~~end~~Credit ofFacility ~~each fiscal quarter~~ and ~~(b)~~no aother ~~total~~short-term ~~leverage~~borrowings ~~ratio~~outstanding as of ~~the end of each fiscal quarter, not to exceed (x) 3.75 to 1.00 with respect to fiscal quarters ending on~~ March 31, ~~June~~2025 30 and December 31, of2024. ~~each~~Under ~~year,~~the ~~and~~prior ~~(y)~~credit ~~4.00~~facility, toMattel ~~1.00~~had ~~with~~no ~~respect~~borrowings tooutstanding ~~fiscal~~and ~~quarters~~no ~~ending~~other onshort-term ~~September~~borrowings 30outstanding as of ~~each~~March 31, ~~year~~2024. ~~The~~Outstanding ~~total~~letters ~~leverage~~of ~~ratio~~credit ~~financial~~under ~~covenant~~the isCredit ~~subject~~Facility tototaled aapproximately ~~step-up~~$9 million toas ~~4.25~~of ~~to 1.00~~March 31, ~~with~~2025 ~~respect~~and toDecember 31, ~~fiscal~~2024. ~~quarters~~Outstanding inletters ~~which~~of ~~certain~~credit ~~material~~under ~~acquisitions~~the ~~are~~prior ~~consummated,~~credit ~~and~~facility ~~for~~totaled aapproximately ~~period~~$9 ofmillion ~~four~~as ~~fiscal~~of ~~quarters thereafter~~March 31, ~~and subject to certain customary exceptions~~2024.

The ~~New~~ Credit Agreement is a material agreement, and failure to comply with its covenants may result in an event of default under the terms of the ~~New Revolving~~ Credit Facility. If Mattel were to default under the terms of the ~~New Revolving~~ Credit Facility, its ability to meet its seasonal financing requirements could be adversely affected.

9. Long-Term Debt

Long-term debt included the following:

	September 30,2024		September 30,2023		December 31,2023
	March 31,2025		March 31,2024		December 31,2024
	(In thousands)
2010 Senior Notes due October 2040	$	250,000	$	250,000	$	250,000
2011 Senior Notes due November 2041	300,000		300,000		300,000
2019 Senior Notes due December 2027	600,000		600,000		600,000
2021 Senior Notes due April 2026	600,000		600,000		600,000
2021 Senior Notes due April 2029	600,000		600,000		600,000
Debt issuance costs and debt discount	(1614,~~740~~558)		(2118,~~103~~922)		(2015,~~014~~649)
	$	2,333,260	$	2,328,897	$	2,329,986
	2,335,442		2,331,078		2,334,351
Less: current portion	—		—		—
Total long-term debt	$	2,~~333~~335,~~260~~442	$	2,~~328~~331,~~897~~078	$	2,~~329~~334,~~986~~351

Mattel's 2019 Senior Notes due 2027 were issued pursuant to an indenture dated November 20, 2019, and its 2021 Senior Notes due 2026 and 2021 Senior Notes due 2029 were issued pursuant to an indenture dated March 19, 2021. These indentures contain covenants that limit Mattel's (and some of its subsidiaries') ability to, among other things: (i) incur additional debt or issue certain preferred shares; (ii) pay dividends on or make other distributions in respect of their capital stock or make other restricted payments; (iii) make investments in unrestricted subsidiaries; (iv) create liens; (v) enter into certain sale/leaseback transactions; (vi) merge or consolidate, or sell, transfer or otherwise dispose of substantially all of their assets; and (vii) designate ~~subsidiaries~~future ~~as unrestricted~~guarantors. The indentures also provided that certain of these covenants would be suspended if Mattel achieved a debt rating of BBB-, Baa3, and/or BBB- (or higher) from any two of S&P, Moody's, and Fitch, respectively, and no event of default has occurred.

In ~~April 2023~~2024, ~~S&P~~Fitch ~~upgraded~~changed Mattel's credit rating from BB+ to BBB- ~~and~~with ~~maintained~~ a ~~positive~~stable outlook, ~~and~~S&P inchanged ~~November~~Mattel's ~~2022~~credit rating from BBB- to BBB with a stable outlook, and Moody's ~~upgraded~~maintained Mattel's credit rating ~~from~~of ~~Ba1~~Baa3 towith ~~Baa3~~a stable outlook. As a result of the ~~upgraded~~current credit ratings and no events of default, the covenants limiting Mattel's ability to incur additional debt or issue certain preferred shares, pay dividends on or make other distributions in respect of ~~their~~its capital stock or make other restricted payments, and make investments in unrestricted subsidiaries, and certain provisions of the covenant limiting Mattel's ability to merge or consolidate, or sell, transfer or otherwise dispose of substantially all of ~~their~~its assets and designate future guarantors, are suspended. If Mattel ceases to have credit ratings of BBB-, Baa3, and/or BBB- (or higher) from any two of S&P, Moody's, and Fitch, respectively, Mattel will thereafter be subject to the suspended covenants with respect to future events.

10. Accumulated Other Comprehensive Income (Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income (loss), including current period other comprehensive income (loss) and reclassifications from accumulated other comprehensive income (loss):

	For the Three Months Ended September 30, 2024
	For the Three Months Ended March 31, 2025
	DerivativeInstruments		Employee Benefit Plans		CurrencyTranslationAdjustments		Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2024	$	5,268	$	(140,469)	$	(799,916)	$	(935,117)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2024	$	14,307	$	(139,663)	$	(869,096)	$	(994,452)
Other comprehensive income (loss) before reclassifications	(139,~~288~~223)		1637		2453,~~442~~618		1144,~~170~~432
Amounts reclassified from accumulated other comprehensive income (loss)	72,~~264~~185		~~978~~1,248		—		83,~~242~~433
Net change in other comprehensive income (loss)	(67,~~024~~038)		~~994~~1,285		2453,~~442~~618		1947,~~412~~865
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2024	$	(756)	$	(139,475)	$	(775,474)	$	(915,705)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2025	$	7,269	$	(138,378)	$	(815,478)	$	(946,587)

	For the Nine Months Ended September 30, 2024
	For the Three Months Ended March 31, 2024
	DerivativeInstruments		Employee Benefit Plans		CurrencyTranslationAdjustments		Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2023	$	(3,463)	$	(142,916)	$	(758,589)	$	(904,968)
Other comprehensive income (loss) before reclassifications	913,~~764~~224		501,493		(1617,~~885~~946)		(73,~~071~~229)
Amounts reclassified from accumulated other comprehensive income (loss)	(78,~~057~~241)		~~3,391~~705		—		(37,~~666~~536)
Net change in other comprehensive income (loss)	24,~~707~~983		32,~~441~~198		(1617,~~885~~946)		(10,~~737~~765)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2024	$	(756)	$	(139,475)	$	(775,474)	$	(915,705)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2024	$	1,520	$	(140,718)	$	(776,535)	$	(915,733)

	For the Three Months Ended September 30, 2023
	DerivativeInstruments		Employee Benefit Plans		CurrencyTranslationAdjustments		Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2023	$	5,221	$	(137,042)	$	(765,431)	$	(897,252)
Other comprehensive income (loss) before reclassifications	7,521		5		(39,273)		(31,747)
Amounts reclassified from accumulated other comprehensive income (loss)	(5,801)		659		—		(5,142)
Net change in other comprehensive income (loss)	1,720		664		(39,273)		(36,889)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2023	$	6,941	$	(136,378)	$	(804,704)	$	(934,141)

The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statements of operations:

	For the Nine Months Ended September 30, 2023
	For the Three Months Ended
	DerivativeInstruments		Employee Benefit Plans		CurrencyTranslationAdjustments		Total
	March 31, 2025		March 31, 2024		Statements of OperationsClassification
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2022	$	22,732	$	(138,498)	$	(795,712)	$	(911,478)
Derivative Instruments:
Other comprehensive income (loss) before reclassifications	(1,729)		20		(8,992)		(10,701)
(Loss) gain on foreign currency forward exchange and other contracts	$	(2,188)	$	8,225	Cost of sales
Amounts reclassified from accumulated other comprehensive income (loss)	(14,062)		2,100		—		(11,962)
Tax effect	3		16		Provision/benefit from income taxes
Net change in other comprehensive income (loss)	(15,791)		2,120		(8,992)		(22,663)
	$	(2,185)	$	8,241	Net income/loss
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2023	$	6,941	$	(136,378)	$	(804,704)	$	(934,141)
Employee Benefit Plans:
Amortization of prior service credit (a)	$	450	$	461	Other non-operating income/expense, net
Recognized actuarial loss (a)	(2,092)		(1,895)		Other non-operating income/expense, net
	(1,642)		(1,434)
Tax effect	394		729		Provision/benefit from income taxes
	$	(1,248)	$	(705)	Net income/loss

The following tables present the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statements of operations:

	For the Three Months Ended
	September 30, 2024		September 30, 2023		Statements of OperationsClassification
	(In thousands)
Derivative Instruments:
(Loss) gain on foreign currency forward exchange and other contracts	$	(7,275)	$	5,784	Cost of sales
Tax effect	11		17		Provision/benefit from income taxes
	$	(7,264)	$	5,801	Net income/loss
Employee Benefit Plans:
Amortization of prior service credit (a)	$	460	$	472	Other non-operating income/expense, net
Recognized actuarial loss (a)	(1,902)		(1,410)		Other non-operating income/expense, net
	(1,442)		(938)
Tax effect	464		279		Provision/benefit from income taxes
	$	(978)	$	(659)	Net income/loss

	For the Nine Months Ended
	September 30, 2024		September 30, 2023		Statements of OperationsClassification
	(In thousands)
Derivative Instruments:
Gain on foreign currency forward exchange and other contracts	$	7,023	$	13,709	Cost of sales
Tax effect	34		353		Provision/benefit from income taxes
	$	7,057	$	14,062	Net income/loss
Employee Benefit Plans:
Amortization of prior service credit (a)	$	1,383	$	1,416	Other non-operating income/expense, net
Recognized actuarial loss (a)	(5,693)		(4,229)		Other non-operating income/expense, net
	(4,310)		(2,813)
Tax effect	919		713		Provision/benefit from income taxes
	$	(3,391)	$	(2,100)	Net income/loss

(a)The amortization of prior service credit and recognized actuarial loss are included in the computation of net periodic benefit cost. Refer to "Note 15 to the Consolidated Financial Statements—Employee Benefit Plans" for additional information regarding Mattel's net periodic benefit cost.

Currency Translation Adjustments

During the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025, currency translation adjustments resulted in a net ~~loss~~gain of $1653.96 million, primarily due to the ~~weakening~~strengthening of the ~~Mexican~~Russian ~~peso~~ruble and ~~Brazilian real against the U.S. dollar, partially offset by the strengthening of the~~ British pound sterling against the U.S. dollar.

During the ~~nine~~three months ended ~~September~~March 3031, ~~2023~~2024, currency translation adjustments resulted in a net loss of $917.09 million, ~~primarily~~ due to the ~~weakening~~general strengthening of the ~~Russian~~U.S. ~~ruble~~dollar ~~and~~against ~~Malaysian~~most ~~ringgit~~currencies, ~~against~~including the UChilean peso and Russian ruble.S. ~~dollar,~~The losses were partially offset by the strengthening of the Mexican peso, ~~British pound sterling, and Brazilian real~~ against the U.S. dollar.

1413

11. Foreign Currency Transaction Exposure

Currency transaction gains (losses) included in the consolidated statements of operations were as follows:

	For the Three Months Ended
	September 30,2024		September 30,2023		Statements of Operations Classification
	March 31,2025		March 31,2024		Statements of Operations Classification
	(In thousands)
Currency transaction (losses), net	$	(10,047)	$	(2,276)	Operating income/expense
Currency transaction gains, net	$	930	$	118	Operating income/expense
Currency transaction gains, net	4,758		3,301		Other non-operating income/expense, net
Currency transaction (losses) gains, net	(10,435)		714		Other non-operating income/expense, net
Currency transaction (losses) gains, net	$	(59,~~289~~505)	$	~~1,025~~832

	For the Nine Months Ended
	September 30,2024		September 30,2023		Statements of Operations Classification
	(In thousands)
Currency transaction (losses), net	$	(16,087)	$	(11,987)	Operating income/expense
Currency transaction (losses) gains, net	(226)		5,390		Other non-operating income/expense, net
Currency transaction (losses), net	$	(16,313)	$	(6,597)

12. Derivative Instruments

Mattel seeks to mitigate its exposure to foreign currency transaction risk by monitoring its foreign currency transaction exposure for the year and partially hedging such exposure using foreign currency forward exchange contracts. Mattel uses foreign currency forward exchange contracts as cash flow hedges primarily to hedge its purchases and sales of inventory denominated in foreign currencies. These contracts have maturity dates of up to 24 months. These derivative instruments have been designated as effective cash flow hedges, whereby the unsettled hedges are reported in Mattel's consolidated balance sheets at fair value, with changes in the fair value of the hedges reflected in other comprehensive income ("OCI"). Realized gains and losses for these contracts are recorded in the consolidated statements of operations in the period in which the inventory is sold to customers. Mattel uses foreign currency forward exchange contracts to hedge intercompany loans and advances denominated in foreign currencies. Due to the short-term nature of the contracts involved, Mattel does not use hedge accounting for these contracts, and as such, changes in fair value are recorded in the period of change in the consolidated statements of operations. Mattel utilizes derivative contracts to hedge certain purchases of commodities, which were not material. As of ~~September~~March 3031, ~~2024~~2025, ~~September~~March 3031, ~~2023~~2024, and December 31, ~~2023~~2024, Mattel held foreign currency forward exchange contracts and other commodity derivative instruments, with notional amounts of approximately $~~748~~881 million, $~~636~~683 million, and $~~609~~628 million, respectively.

1514

The following tables present Mattel's derivative assets and liabilities:

	Derivative Assets
	Balance Sheet Classification	Fair Value
		September 30,2024		September 30,2023		December 31,2023
		March 31,2025		March 31,2024		December 31,2024
		(In thousands)
Derivatives Designated as Hedging Instruments:
Foreign currency forward exchange and other contracts	Prepaid expenses and other current assets	$	27,~~196~~423	$	134,~~308~~631	$	217,~~198~~290
Foreign currency forward exchange and other contracts	Other noncurrent assets	34553		~~747~~423		522,775
Total Derivatives Designated as Hedging Instruments		$	27,~~230~~976	$	145,~~055~~054	$	220,~~250~~065
Derivatives Not Designated as Hedging Instruments:
Foreign currency forward exchange and other contracts	Prepaid expenses and other current assets	$	~~1,251~~586	$	~~519~~3,511	$	~~578~~1,966
Total Derivatives Not Designated as Hedging Instruments		$	~~1,251~~586	$	~~519~~3,511	$	~~578~~1,966
		$	38,~~481~~562	$	148,~~574~~565	$	222,~~828~~031
	Derivative Liabilities
	Balance Sheet Classification	Fair Value
		September 30,2024		September 30,2023		December 31,2023
		March 31,2025		March 31,2024		December 31,2024
		(In thousands)
Derivatives Designated as Hedging Instruments:
Foreign currency forward exchange and other contracts	Accrued liabilities	$	83,~~571~~749	$	14,~~997~~389	$	71,~~520~~370
Foreign currency forward exchange and other contracts	Other noncurrent liabilities	~~2,026~~905		1447		~~1,575~~65
Total Derivatives Designated as Hedging Instruments		$	104,~~597~~654	$	24,~~011~~436	$	91,~~095~~435
Derivatives Not Designated as Hedging Instruments:
Foreign currency forward exchange and other contracts	Accrued liabilities	$	~~608~~1,438	$	~~323~~173	$	~~449~~902
Foreign currency forward exchange and other contracts	Other noncurrent liabilities	—		—		20
Total Derivatives Not Designated as Hedging Instruments		$	1,438	$	173	$	902
Total Derivatives Not Designated as Hedging Instruments		$	608	$	323	$	469
		$	6,092	$	4,609	$	2,337
		$	11,205	$	2,334	$	9,564

1615

The following tables present the classification and amount of gains and losses, net of tax, from derivatives reported in the consolidated statements of operations:

Derivatives Designated as Hedging Instruments

For the Three Months Ended

September 30,2024

September 30,2023

Statements ofOperationsClassification

March 31,2025

March 31,2024

Statements ofOperationsClassification

(In thousands)

Foreign Currency Forward Exchange and Other Contracts:

Amount of (losses) gains recognized in OCI

(139,~~288~~223)

713,~~521~~224

Amount of (losses) gains reclassified from accumulated OCI to the consolidated statements of operations

(72,~~264~~185)

58,~~801~~241

Cost of sales

Derivatives Designated as Hedging Instruments

For the Nine Months Ended

September 30,2024

September 30,2023

Statements ofOperationsClassification

(In thousands)

Foreign Currency Forward Exchange and Other Contracts:

Amount of gains (losses) recognized in OCI

9,764

(1,729)

Amount of gains reclassified from accumulated OCI to the consolidated statements of operations

7,057

14,062

Cost of sales

The net gains reclassified from accumulated other comprehensive loss to the consolidated statements of operations during the three months ended March 31, 2025 and 2024 were offset by changes in cash flows associated with the underlying hedged transactions.

The net gains reclassified from accumulated other comprehensive loss to the consolidated statements of operations during the three and nine months ended September 30, 2024 and 2023, respectively, were offset by changes in cash flows associated with the underlying hedged transactions.

Derivatives Not Designated as Hedging Instruments

For the Three Months Ended

March 31,
2025

March 31,
2024

Statements of
Operations
Classification

(In thousands)

Amount of Net Gains (Losses) Recognized in the Statements of Operations:

Foreign currency forward exchange and other contracts

1,869

5,063

Other non-operating income/expense, net

Derivatives Not Designated as Hedging Instruments

For the Three Months Ended

September 30,2024

September 30,2023

Statements ofOperationsClassification

(In thousands)

Amount of Net Gains (Losses) Recognized in the Statements of Operations:

Foreign currency forward exchange and other contracts

1,845

6,805

Other non-operating income/expense, net

The net gains and losses recognized in the consolidated statements of operations during the three months ended March 31, 2025 and March 31, 2024, respectively, were offset by foreign currency transaction gains and losses on the related derivative balances.

Derivatives Not Designated as Hedging Instruments

For the Nine Months Ended

September 30,2024

September 30,2023

Statements ofOperationsClassification

(In thousands)

Amount of Net Gains (Losses) Recognized in the Statements of Operations:

Foreign currency forward exchange and other contracts

2,195

25,083

Other non-operating income/expense, net

The net gains and losses recognized in the consolidated statements of operations during the three and nine months ended September 30, 2024 and September 30, 2023, respectively, were offset by foreign currency transaction gains and losses on the related derivative balances.

13. Fair Value Measurements

The following tables present information about Mattel's financial assets and liabilities measured and reported in the financial statements at fair value on a recurring basis as of ~~September~~March 3031, ~~2024~~2025, ~~September~~March 3031, ~~2023~~2024, and December 31, ~~2023~~2024 and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value. The three levels of the fair value hierarchy are as follows:

•Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.

•Level 2 – Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.

•Level 3 – Valuations based on inputs that are unobservable, supported by little or no market activity, and that are significant to the fair value of the assets or liabilities.

	September 30, 2024
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)	$	—	$	3,481	$	—	$	3,481
Liabilities:
Foreign currency forward exchange and other contracts (a)	$	—	$	11,205	$	—	$	11,205
	September 30, 2023
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)	$	—	$	14,574	$	—	$	14,574
Liabilities:
Foreign currency forward exchange and other contracts (a)	$	—	$	2,334	$	—	$	2,334
	December 31, 2023
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)	$	—	$	2,828	$	—	$	2,828
Liabilities:
Foreign currency forward exchange and other contracts (a)	$	—	$	9,564	$	—	$	9,564


	March 31, 2025
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)	$	—	$	8,562	$	—	$	8,562
Liabilities:
Foreign currency forward exchange and other contracts (a)	$	—	$	6,092	$	—	$	6,092

	March 31, 2024
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)	$	—	$	8,565	$	—	$	8,565

Liabilities:
Foreign currency forward exchange and other contracts (a)	$	—	$	4,609	$	—	$	4,609

	December 31, 2024
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)	$	—	$	22,031	$	—	$	22,031
Liabilities:
Foreign currency forward exchange and other contracts (a)	$	—	$	2,337	$	—	$	2,337

(a)The fair value of the foreign currency forward exchange and other contracts was based on dealer quotes of market forward rates and reflects the amount that Mattel would receive or pay at their maturity dates for contracts involving the same notional amounts, currencies, and maturity dates.

Other Financial Instruments

Mattel's financial instruments included cash and equivalents, accounts receivable and payable, accrued liabilities, short-term borrowings, and long-term debt. The fair values of these instruments, excluding long-term debt, approximate their carrying amounts because of their short-term nature. Cash and equivalents were classified as Level 1 and all other financial instruments were classified as Level 2 within the fair value hierarchy.

The estimated fair value of Mattel's long-term debt was $2.3128 billion (compared to a carrying amount of $2.35 billion) as of ~~September~~March 3031, ~~2024~~2025, $2.1326 billion (compared to a carrying amount of $2.35 billion) as of ~~September~~March 3031, ~~2023~~2024, and $2.2327 billion (compared to a carrying amount of $2.35 billion) as of December 31, ~~2023~~2024. The estimated fair values have been calculated based on broker quotes or rates for the same or similar instruments and were classified as Level 2 within the fair value hierarchy.

14. Earnings Per Share

The following table reconciles basic and diluted earnings per common share for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2024~~2025 and ~~2023~~2024:

	~~For the Three Months Ended~~		For the Three Months Ended			~~For the Nine Months Ended~~
	September 30,2024		September 30,2023			September 30,2024		September 30,2023
						March 31,2025		March 31,2024
	~~(In thousands, except per share amounts)~~				(In thousands, except per share amounts)
Basic:
Net income	$	372,376	$	146,319		$	400,955	$	67,034
Net loss						$	(40,319)	$	(28,281)
Weighted-average number of common shares	~~339,059~~		~~354,139~~			~~342~~327,~~707~~493		~~354~~346,~~559~~888
Basic net income per common share	$	1.10	$	0.41		$	1.17	$	0.19
Basic net loss per common share						$	(0.12)	$	(0.08)
Diluted:
Net income	$	372,376	$	146,319		$	400,955	$	67,034
Net loss						$	(40,319)	$	(28,281)
Weighted-average number of common shares	~~339,059~~		~~354,139~~			~~342~~327,~~707~~493		~~354~~346,~~559~~888
Dilutive share-based awards (a)	~~2,157~~		~~3,335~~			~~2,673~~—		~~3,418~~—
Weighted-average number of common and potential common shares	~~341,216~~		~~357,474~~			~~345~~327,~~380~~493		~~357~~346,~~977~~888
Diluted net income per common share	$	1.09	$	0.41		$	1.16	$	0.19
Diluted net loss per common share						$	(0.12)	$	(0.08)

(a)For the three ~~and nine~~ months ended ~~September~~March 3031, ~~2024,~~2025 ~~6.9 million~~ and ~~7.7~~March ~~million share-based awards~~31, ~~respectively~~2024, ~~were excluded from the calculation of diluted net income per common share because their effect would be antidilutive~~9. ~~For the three and nine months ended September~~3 ~~30, 2023, 6.5~~ million and 1110.54 million share-based awards, respectively, were excluded from the calculation of diluted net ~~income~~loss per common share because their effect would be antidilutive.

15. Employee Benefit Plans

Mattel and certain of its subsidiaries have qualified and nonqualified retirement plans covering substantially all employees of these companies, which are more fully described in Part II, Item 8 "Financial Statements and Supplementary Data—Note 4 to the Consolidated Financial Statements–Employee Benefit Plans" in the ~~2023~~2024 Annual Report on Form 10-K.

The components of Mattel's net periodic benefit cost for defined benefit pension plans were as follows:

For the Three Months Ended

~~For the Nine Months Ended~~

September 30,2024

September 30,2023

September 30,2024

September 30,2023

March 31,2025

March 31,2024

(In thousands)

Service cost

~~851~~830

~~848~~859

~~2,548~~

Interest cost

5,~~059~~080

5,~~234~~053

~~15,142~~

~~15,670~~

Expected return on plan assets

(4,~~693~~369)

(54,~~103~~681)

~~(14,052)~~

~~(15,280)~~

Amortization of prior service cost

3748

~~145~~

~~112~~

Recognized actuarial loss

12,~~950~~165

1,~~467~~943

~~5,836~~

~~4,399~~

Net periodic benefit cost

3,~~216~~755

23,~~483~~222

~~9,619~~

~~7,449~~

The components of Mattel's net periodic benefit credit for postretirement benefit plans were as follows:

For the Three Months Ended

~~For the Nine Months Ended~~

September 30,2024

September 30,2023

September 30,2024

September 30,2023

March 31,2025

March 31,2024

(In thousands)

Interest cost

4536

~~135~~

~~134~~

Amortization of prior service credit

(~~509~~499)

(509)

~~(1,528)~~

Recognized actuarial gain

(4873)

(5748)

~~(143)~~

~~(170)~~

Net periodic benefit credit

(~~512~~536)

(~~521~~512)

~~(1,536)~~

~~(1,564)~~

Mattel's service cost component is recorded within operating ~~income~~loss while other components of net periodic ~~pension~~benefit ~~cost~~costs for defined benefit pension and postretirement benefit ~~cost~~plans are recorded within other non-operating ~~(income)~~ expense, net.

During the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025, Mattel made cash contributions totaling approximately $149 million related to its defined benefit pension and postretirement benefit plans. During the remainder of ~~2024~~2025, Mattel expects to make additional cash contributions of approximately $512 million.

16. Share-Based Payments

Mattel has various stock compensation plans, which are described in Part II, Item 8 "Financial Statements and Supplementary Data—Note 9 to the Consolidated Financial Statements—Share-Based Payments" in the ~~2023~~2024 Annual Report on Form 10-K. Under the Mattel, Inc. Amended and Restated 2010 Equity and Long-Term Compensation Plan ~~("the Plan")~~, Mattel has the ability to grant nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units ("RSUs"), performance RSUs ("performance awards"), dividend equivalent rights, and shares of common stock to officers, employees, non-employee directors, and consultants providing services to Mattel. Stock options are granted with exercise prices at the fair market value of Mattel's common stock on the applicable grant date and expire no later than ten years from the grant date. Stock options, RSUs, and performance awards related to Mattel's long-term incentive program generally provide for vesting over, or at the end of, a period of three years from the grant date. On September 30, 2024, a one-time retention performance award was granted to Ynon Kreiz, Mattel's Chief Executive Officer, which vests over a period of five years from the grant date, subject to potential acceleration upon certain qualifying terminations of employment.

On September 30, 2024, a one-time retention award of performance-based restricted stock units (the "Retention Performance Grant") was granted to Ynon Kreiz, Mattel's Chief Executive Officer, in order to incentivize retention and drive significant stock price performance and market outperformance. The Retention Performance Grant has targeted approximately 0.8 million performance-based restricted stock units granted under the Plan, which was determined based on a target value of $15.0 million divided by the closing price of Mattel's common stock on the grant date. The Retention Performance Grant is 100% performance-based, with 50% of the Retention Performance Grant subject to vesting based on the achievement of the stock price hurdles during the final three years of the five-year performance measurement period, and the remaining 50% of the Retention Performance Grant subject to vesting based on Mattel's relative Total Shareholder Return ("TSR") over the five-year performance measurement period.

No portion of the Retention Performance Grant will be earned unless Mattel achieves rigorous performance goals and Mr. Kreiz remains employed through the settlement date following the completion of a five-year vesting period from September 30, 2024 to September 30, 2029, subject to potential acceleration upon certain qualifying terminations of employment. The grant also allows for a maximum potential earnout of 200% of the targeted number of performance-based restricted stock units.

The fair value of the Retention Performance Grant has been estimated using a Monte Carlo valuation methodology. The Retention Performance Grant has an estimated grant-date fair value of $24.42 per unit and total estimated grant-date fair value of $19.2 million, which will be recognized on a straight-line basis over the service period.

Compensation expense, included within other selling and administrative expenses in the consolidated statements of operations, related to stock options, RSUs, and performance awards, was as follows:

For the Three Months Ended

~~For the Nine Months Ended~~

September 30,2024

September 30,2023

September 30,2024

September 30,2023

March 31,2025

March 31,2024

(In thousands)

Stock option compensation expense

~~716~~578

1,~~077~~046

~~2,515~~

~~5,673~~

RSU compensation expense

13,~~860~~487

12,~~020~~248

~~42,185~~

~~36,724~~

Performance award compensation expense

5,~~109~~839

24,~~395~~635

~~12,748~~

~~10,028~~

19,~~685~~904

1517,~~492~~929

~~57,448~~

~~52,425~~

As of ~~September~~March 3031, ~~2024~~2025, total unrecognized compensation expense related to unvested share-based payments totaled $~~139~~103.06 million and is expected to be recognized over a weighted-average period of 2.52 years.

Mattel uses treasury shares purchased under its share repurchase program to satisfy stock option exercises and the vesting of RSUs and performance awards. Cash received for stock option exercises, net of taxes, was $61.27 million and $264.03 million for the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025 and ~~2023~~2024, respectively.

17. Other Selling and Administrative Expenses

Other selling and administrative expenses included the following:

	~~For the Three Months Ended~~		For the Three Months Ended						~~For the Nine Months Ended~~
	September 30,2024				September 30,2023				September 30,2024		September 30,2023
			March 31,2025				March 31,2024
	(In thousands)
Design and development	$	~~46,842~~	$	46,793	$	~~49,781~~	$	47,610	$	~~141,871~~	$	~~148,319~~
Amortization of intangible assets	7,863				9,584				23,503		28,570
Identifiable intangible asset amortization			7,769				7,823

18. Restructuring Charges

Optimizing for Profitable Growth

On February 7, 2024, Mattel announced the Optimizing for Profitable Growth program (the "OPG program"), a multi-year cost savings program that follows the Optimizing for Growth program (the "OFG program"), which concluded in the fourth quarter of 2023. The OPG program is designed to achieve further efficiency and cost savings opportunities, primarily within Mattel's global supply chain, including its manufacturing footprint. The OPG program includes cost savings actions in connection with discontinuing production at a plant in China as previously announced in the third quarter of 2023, as well as savings from other previous actions taken in 2023 that were not recognized in the OFG program.

In connection with the OPG program, Mattel recorded severance and other restructuring costs in the following cost and expense categories within operating income in the consolidated statements of operations:

~~For the Three Months Ended~~

For the ~~Nine~~Three Months Ended

September 30,2024

September 30,2023

September 30,2024

September 30,2023

March 31,2025

March 31,2024

~~(In thousands)~~

(In thousands)

Cost of sales (a)

~~392~~

—

31,~~016~~621

—2,213

Other selling and administrative expenses (b)

~~26,769~~

~~25,274~~

4417,~~743~~760

257,~~274~~518

~~27,161~~

~~25,274~~

4719,~~759~~381

259,~~274~~731

(a)Severance and other restructuring charges recorded within cost of sales in the consolidated statements of operations are included in segment operating income in "Note 21 to the Consolidated Financial Statements—Segment Information."

(b)Severance and other restructuring charges recorded within other selling and administrative expenses in the consolidated statements of operations are included in corporate and other expense in "Note 21 to the Consolidated Financial Statements—Segment Information."

The following tables summarize Mattel's severance and other restructuring charges activity within operating income related to the OPG program:

Liability at December 31, 2023

Charges

Payments/Utilization

Liability at September 30, 2024

Liability at December 31, 2024

Charges

Payments/Utilization

Liability at March 31, 2025

(In thousands)

Severance

2532,~~096~~661

4617,~~108~~744

(305,~~732~~354)

4045,~~472~~051

Other restructuring charges (a)

—10

1,~~651~~637

(1,~~617~~635)

3412

2532,~~096~~671

4719,~~759~~381

(326,~~349~~989)

4045,~~506~~063

	Liability at December 31, 2022		Charges		Payments/Utilization		Liability at September 30, 2023
	Liability at December 31, 2023		Charges		Payments/Utilization		Liability at March 31, 2024
	(In thousands)
Severance	$	—25,096	$	259,~~274~~229	$	—(1,536)	$	2532,~~274~~789
Other restructuring charges	—		—		—		—
Other restructuring charges (a)	—		502		(502)		—
	$	—25,096	$	259,~~274~~731	$	—(2,038)	$	2532,~~274~~789

(a)Other restructuring charges consist primarily of expenses associated with the consolidation of manufacturing facilities.

As of September 30, 2024, in connection with the OPG program, Mattel recorded cumulative severance and other restructuring charges of approximately $73 million, which included approximately $1 million of non-cash charges. Total expected cash expenditures are approximately $130 to $165 million and total non-cash charges are expected to be up to $5 million.20

~~Other~~As ~~Cost~~of ~~Savings~~March 31, ~~Actions~~2025, in connection with the OPG program, Mattel recorded cumulative severance and other restructuring charges of approximately $94 million, which included approximately $2 million of non-cash charges. Total expected cash expenditures are approximately $115 to $140 million and total non-cash charges are expected to be up to $5 million.

As of December 31, 2023, Mattel concluded the OFG program, a multi-year cost savings program that had integrated and expanded upon the previous Capital Light program. In connection with the OFG program, Mattel recorded severance and other restructuring charges of $3.1 million and $31.6 million within other selling and administrative expenses during the three and nine months ended September 30, 2023, respectively, and a credit to severance and other restructuring charges of ($0.1) million and ($1.3) million within cost of sales during the three and nine months ended September 30, 2023, respectively, in the consolidated statement of operations.

Additionally, during the three and nine months ended September 30, 2023, Mattel executed actions to further streamline its organizational structure that were not included in the OFG program. In connection with these actions, Mattel recorded severance charges of $0.9 million and $6.1 million within other selling and administrative expenses during the three and nine months ended September 30, 2023, respectively, in the consolidated statement of operations.

19. Income Taxes

Mattel's ~~provision~~benefit ~~for~~from income taxes was $~~106~~30.46 million ~~and $94.8 million~~ for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2024~~2025, ~~respectively,~~compared ~~and~~to $~~309~~20.~~3 million and $296.~~8 million for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2023, respectively~~2024. ~~Mattel~~The ~~recognized~~increase ain ~~net~~benefit ~~discrete~~from income ~~tax~~taxes ~~benefit~~was ofdriven ~~$3.4 million~~by ~~during~~higher ~~the~~loss ~~three~~before ~~months~~income ~~ended~~taxes ~~September~~and ~~30,~~higher ~~2024,~~discrete ~~primarily~~income ~~related to reassessments of prior years'~~ tax ~~liabilities,~~benefits ~~partially~~in ~~offset~~the byfirst ~~the~~three ~~establishment~~months of a2025. ~~valuation~~During ~~allowance~~the onthree ~~certain~~months ~~foreign~~ended ~~deferred~~March ~~tax~~31, ~~assets.~~2025, Mattel recognized a net discrete ~~income~~ tax benefit of $1611.34 million ~~during the nine months ended September 30~~, ~~2024,~~ primarily related to ~~reassessment~~a change of ~~prior~~its ~~years'~~indefinite ~~tax~~reinvestment ~~liabilities~~assertion ~~and~~relating ~~discrete tax benefit on tax elections filed~~ to ~~amortize~~ certain ~~intangible~~foreign ~~assets~~subsidiary ~~transferred~~earnings. asDuring ~~part~~the ofthree ~~Mattel's~~months ~~intra-group~~ended ~~intellectual~~March ~~property~~31, ~~("IP")~~2024, ~~rights transfer.~~ Mattel recognized a net discrete income tax ~~expense~~benefit of $~~200~~8.74 million ~~and $201.0 million during the three and nine months ended September 30~~, ~~2023,~~primarily ~~respectively,~~related ~~which~~to ~~included~~tax ~~the~~elections ~~establishment~~filed ofto aamortize ~~valuation allowance of $212.4 million on~~ certain ~~foreign~~intangible ~~deferred~~assets ~~tax~~transferred ~~assets~~as ~~resulting~~part ~~from~~of ~~the~~Mattel's intra-group ~~transfer~~intellectual ofproperty ~~certain IP~~ rights transfer, partially offset by ~~undistributed~~interest ~~earnings~~related ofto ~~certain~~unrecognized ~~foreign subsidiaries and reassessments of prior years'~~ tax ~~liabilities~~benefits.

Evaluating the need for and the amount of a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence to determine whether it is more-likely-than-not that these assets will be realizable. Mattel routinely assesses the positive and negative evidence for this realizability, including the evaluation of sustained profitability and three years of cumulative pretax income for each tax jurisdiction. During the ~~third~~first quarter of ~~2024~~2025, there were no material changes to Mattel's valuation allowance.

In the normal course of business, Mattel is regularly audited by U.S. federal, state, local, and foreign tax authorities. Based on the current status of federal, state, and foreign audits, Mattel believes it is reasonably possible that in the next 12 months, the total unrecognized tax benefits could decrease by $1415.61 million related to the settlement of tax audits and/or the expiration of statutes of limitations. The ultimate settlement of any particular issue with the applicable taxing authority could have a material impact on Mattel's consolidated financial statements.

20. Contingencies

Litigation Related to Yellowstone do Brasil Ltda.

In April 1999, Yellowstone do Brasil Ltda. (formerly known as Trebbor Informática Ltda.) filed a lawsuit against Mattel do Brasil before the 15th Civil Court of Curitiba, State of Parana, requesting the annulment of its security bonds and promissory notes given to Mattel do Brasil as well as damages due to an alleged breach of an oral exclusive distribution agreement between the parties relating to the supply and sale of toys in Brazil. Yellowstone's complaints sought alleged loss of profits plus an unspecified amount of damages.

Mattel do Brasil filed its defenses to these claims and simultaneously presented a counterclaim for unpaid accounts receivable for goods supplied to Yellowstone.

In April 2018, Mattel do Brasil entered into a settlement agreement to resolve this matter, but the settlement remains the subject of ongoing appeals.

In October 2018, the Superior Court of Justice issued a final ruling in favor of Yellowstone on the merits of Yellowstone's claims. Previously, the courts had ruled in Mattel's favor on its counterclaim.

In October 2019, Mattel reached an agreement with Yellowstone's former counsel regarding payment of the attorney's fees portion of the judgment. In November 2019, Yellowstone initiated an action to enforce its judgment against Mattel, but did not account for an offset for Mattel's counterclaim. In January 2020, Mattel obtained an injunction, staying Yellowstone's enforcement action pending resolution of Mattel's appeal to enforce the parties' April 2018 settlement. As of ~~September~~March 3031, ~~2024~~2025, Mattel assessed its probable loss related to this matter and has accrued an estimated liability, which is not material.

2321

Litigation Related to the Fisher-Price Rock 'n Play Sleeper

A number of putative class action lawsuits were filed between April 2019 and October 2019 ~~are pending~~ against Fisher-Price, Inc. and/or Mattel, Inc. asserting claims for false advertising, negligent product design, breach of warranty, fraud, and other claims in connection with the marketing and sale of the Fisher-Price Rock 'n Play Sleeper (the "Sleeper"). In general, the lawsuits ~~allege~~alleged that the Sleeper should not have been marketed and sold as safe and fit for prolonged and overnight sleep for infants. The putative class action lawsuits ~~propose~~proposed nationwide and over 10 statewide consumer classes comprised of those who purchased the Sleeper as marketed as safe for prolonged and overnight sleep. The class actions ~~have~~were ~~been~~ consolidated before a single judge in the United States District Court for the Western District of New York for pre-trial purposes pursuant to the U.S. federal courts' Multi-District Litigation program. In June 2022, the court denied the plaintiffs' motion to certify damages and injunctive relief classes under New York law, but granted plaintiffs' request to certify a New York issue class to resolve two issues on a class-wide basis. In October 2022, the United States Court of Appeals for the Second Circuit denied plaintiffs' petition to appeal the denial of certification of the damages and injunctive relief classes. On July 24, 2024, the parties filed a settlement agreement with the court to resolve this litigation. OnIn August 9, 2024, the ~~settlement~~court ~~was~~ preliminarily approved, byand ~~the~~Mattel ~~court.~~paid, Athe ~~final~~settlement ~~approval~~amount, ~~hearing~~which iswas ~~scheduled~~not ~~for~~material. ~~January~~On February 28, 2025~~. As of September 30~~, ~~2024,~~the ~~Mattel~~court ~~assessed~~granted ~~its~~final ~~probable~~approval ~~loss~~of ~~related~~the ~~to this matter and has accrued an estimated liability, which is not material~~settlement.

Twenty-~~eight~~five ~~additional~~products liability lawsuits filed between April 2019 and September 2024 are pending against Fisher-Price, Inc. and Mattel, Inc. alleging that a product defect in the Sleeper caused the fatalities of or injuries to twenty-~~eight~~five children. More than thirty lawsuits have been settled and/or dismissed. As of March 31, 2025, Mattel assessed its probable loss related to these matters and has accrued an estimated liability where appropriate, which is not material. Additionally, Fisher-Price, Inc. and/or Mattel, Inc. have also received letters from lawyers purporting to represent additional plaintiffs who have threatened to assert similar claims.

In addition, a stockholder ~~has~~ filed a derivative action in the Court of Chancery for the State of Delaware (Kumar v. Bradley, et al., filed July 7, 2020) alleging breach of fiduciary duty and unjust enrichment related to the development, marketing, and sale of the Sleeper. The defendants in the derivative action ~~are~~included certain of Mattel's current and former officers and directors. In August 2021, a second similar derivative action was filed in the Court of Chancery for the State of Delaware (Armon v. Bradley, et al., filed August 30, 2021). The parties ~~have~~ reached a settlement in principle of this litigation, which iswas ~~subject~~approved ~~to approval~~ by the court on April 1, 2025. As of ~~September~~March 3031, ~~2024~~2025, Mattel has determined that a recovery of prior losses in this matter is probable and has accrued for the estimated amount, which is not material.

The lawsuits seek compensatory damages, punitive damages, statutory damages, restitution, disgorgement, attorneys' fees, costs, interest, declaratory relief, and/or injunctive relief. ~~Mattel~~As ~~believes~~noted ~~that~~above, itMattel has ~~substantial~~reached ~~defenses~~settlements toin ~~the~~some ~~allegations~~of inthese ~~the~~ lawsuits, and ~~intends~~in tothe ~~vigorously~~ongoing ~~defend~~cases, ~~against~~Mattel ~~them.~~believes ~~Except~~that asit ~~specifically~~has ~~noted~~substantial ~~above,~~defenses ato ~~reasonable estimate of~~ the ~~amount~~allegations ofmade ~~any~~and ~~possible~~intends ~~loss~~to orvigorously ~~range~~defend ofagainst ~~loss cannot be made at this time~~them.

Insurance Litigation

On January 6, 2023, Mattel, Inc. and Fisher-Price, Inc. filed a lawsuit against their products liability insurers in the Superior Court of the State of Delaware seeking a declaratory judgment regarding the obligations of the insurers to defend and indemnify Mattel for the Sleeper products liability lawsuits. On March 28, 2025, the court issued a summary judgment ruling which determined, among other things, that the Sleeper products liability claims constitute a single occurrence under Mattel’s insurance policies, and that each claim is allocated to the policy year in which the incident occurred. As of March 31, 2025, Mattel assessed its probable loss related to this matter and has accrued an estimated liability, which is not material.

Litigation Related to the Fisher-Price Snuga Swings

~~Purported~~A number of putative class action lawsuits were filed against Fisher-Price, Inc. and Mattel, Inc. ~~have~~between ~~been filed in United States District Courts for the Western District of New York (Bigelow v. Mattel, Inc., et al., filed~~ October ~~17,~~ 2024, and ~~Wall~~February v.2025 ~~Mattel,~~asserting ~~Inc. et al., filed October 25, 2024), and the Central District of California (Shahbaz v. Fisher-Price, Inc., et al., filed October 24, 2024). The lawsuits assert~~ claims for false advertising, breach of contract, breach of warranty, fraud, negligence, and other claims in connection with the marketing and sale of Fisher-Price Snuga Swings (the "Swings"). In general, the lawsuits allege that the Swings were falsely marketed and sold as safe for infant use, particularly infant sleep, and failed to disclose a risk of suffocation. The lawsuits propose nationwide and several state consumer classes comprised of those who purchased the Swings. The lawsuits have been consolidated before a single judge in the United States District Court for the Western District of New York.

The lawsuits seek unspecified compensatory damages, punitive and treble damages, statutory damages, restitution, rescission, disgorgement, attorneys’' fees, costs, interest, and injunctive relief. Mattel believes that it has substantial defenses to the allegations in the lawsuits and intends to vigorously defend against them. AAs ~~reasonable~~of ~~estimate~~March of31, ~~the~~2025, ~~amount~~Mattel ofassessed ~~any~~its ~~possible~~probable loss orrelated ~~range~~to ofthis ~~loss~~matter ~~cannot~~and behas ~~made~~accrued atan ~~this~~estimated ~~time~~liability, which is not material.

21. Segment Information

Mattel designs, manufactures, and markets a broad variety of toy products worldwide, which are sold to its customers and directly to consumers.

Segment Data

~~In the first quarter of 2024,~~ Mattel ~~announced an organizational change that resulted in the American Girl business being integrated into Mattel~~'s ~~North America commercial organization. Such integration resulted in a change to Mattel's operating and~~ reportable segments. ~~Mattel's reportable segments~~ are: (i) North America; and (ii) International. The ~~prior period amounts have been reclassified to conform to the current period presentation. The~~ North America and International segments sell products across Mattel's categories, although some products are developed and adapted for particular international markets, and American Girl products are ~~only~~ sold only in North America.

~~The following tables present information regarding~~ Mattel's ~~net~~reportable ~~sales,~~segments ~~operating~~are ~~income,~~aligned ~~and~~to ~~assets~~the bystructure ~~reportable~~used ~~segment.~~by ~~The~~its ~~corporate~~Chief ~~and~~Executive ~~other~~Officer, ~~expense~~who ~~category~~is ~~includes~~also ~~operating~~the ~~costs~~Chief ~~not~~Operating ~~allocated~~Decision toMaker ~~individual segments~~("CODM"), ~~including~~to ~~charges~~allocate ~~related~~resources toand ~~incentive~~assess ~~and~~performance. ~~share-based~~Mattel's ~~compensation,~~CODM ~~corporate~~evaluates ~~headquarters~~segment ~~functions~~performance ~~managed~~based on aeach ~~worldwide~~segment's ~~basis,~~gross ~~the~~profit ~~impact~~and ofoperating ~~changes~~income. inThe ~~foreign~~CODM ~~currency~~also ~~exchange~~uses ~~rates~~these onmetrics ~~intercompany~~in ~~transactions,~~the ~~and~~annual ~~certain~~budgeting ~~severance~~ and ~~other~~quarterly ~~restructuring~~forecasting ~~costs.~~process ~~It is generally impracticable for Mattel~~ to ~~present~~inform ~~net~~decisions ~~sales~~about byallocating ~~categories,~~capital ~~brands, or products, as trade discounts~~ and other ~~allowances~~resources ~~are~~to ~~generally~~each ~~recorded in the financial accounting systems by customer~~segment.

	For the Three Months Ended				For the Nine Months Ended
	September 30,2024		September 30,2023		September 30,2024		September 30,2023
	(In thousands)
Net Sales by Segment
North America	$	1,108,288	$	1,146,961	$	2,192,555	$	2,241,899
International	735,616		771,827		1,540,586		1,578,632
Net sales	$	1,843,904	$	1,918,788	$	3,733,141	$	3,820,531

The following tables present information regarding Mattel's statement of operations information by segment. The corporate and other category includes operating costs not allocated to individual segments, including charges related to incentive and share-based compensation, corporate headquarters functions managed on a worldwide basis, the impact of changes in foreign currency exchange rates on intercompany transactions, and certain severance and other restructuring costs. It is impracticable for Mattel to present net sales by categories, brands, or products, as trade discounts and other allowances are generally recorded in the financial accounting systems by customer.

	For the Three Months Ended				For the Nine Months Ended
	September 30,2024		September 30,2023		September 30,2024		September 30,2023
	(In thousands)
Operating Income by Segment (a)
North America	$	412,425	$	401,095	$	622,342	$	565,591
International	217,675		202,550		304,257		245,773
	630,100		603,645		926,599		811,364
Corporate and other expense (b)	(141,759)		(129,787)		(390,569)		(389,768)
Operating income	488,341		473,858		536,030		421,596
Interest expense	29,371		30,716		89,415		92,486
Interest (income)	(9,787)		(4,569)		(39,466)		(15,409)
Other non-operating (income) expense, net	(2,924)		(2,391)		8,796		(5,976)
Income before income taxes	$	471,681	$	450,102	$	477,285	$	350,495

(a)Segment operating income included (i) severance and other restructuring charges of $0.4 million and $3.0 million for the three and nine months ended September 30, 2024, respectively, and $(0.1) million and $(1.3) million for the three and nine months ended September 30, 2023, respectively, which were allocated to the North America and International segments; and (ii) a loss on sale of assets of $1.8 million from the sale of a production facility for the three and nine months ended September 30, 2023, which was recorded in the International segment.


	For the Three Months Ended March 31, 2025
	North America		International		Total Reportable Segments		Corporate and other		Consolidated
	(In thousands)
Net Sales	$	491,365	$	335,264	$	826,629	$	—	$	826,629
Cost of sales (a)	256,293		175,522		431,815		(13,282)		418,533
Gross Profit	235,072		159,742		394,814		13,282		408,096
Advertising and promotion expenses	38,586		31,612		70,198		—		70,198
Other selling and administrative expenses (b)	113,415		104,810		218,225		172,653		390,878
Operating Income (Loss)	83,071		23,320		106,391		(159,371)		(52,980)
Interest expense							29,234		29,234
Interest (income)							(15,952)		(15,952)
Other non-operating expense, net							13,040		13,040
Loss Before Income Taxes									$	(79,302)

(ba)~~Corporate~~Cost ~~and~~of ~~other~~sales ~~expense~~ included ~~(i)~~ severance and other restructuring charges of ~~$27.1 million~~approximately ~~and~~ $~~43.8~~2 million ~~for~~recorded ~~the~~to ~~three~~corporate and ~~nine months ended September 30, 2024, respectively, and $29~~other.3 million and $63.0 million for the three and nine months ended September 30, 2023, respectively; and (ii) inclined sleeper product recall impact of $(11.7) million and $(5.8) million for the three and nine months ended September 30, 2024, respectively and $1.3 million and $9.0 million for the three and nine months ended September 30, 2023, respectively.

25(b)Other selling and administrative expenses included severance and other restructuring charges, the impact of inclined sleeper product recall litigation, incentive compensation, and share-based compensation of approximately $21 million, $14 million, $24 million, and $20 million, respectively, which were recorded in corporate and other.

Segment assets are comprised of accounts receivable, net and inventories.


	For the Three Months Ended March 31, 2024
	North America		International		Total Reportable Segments		Corporate and other		Consolidated
	(In thousands)
Net Sales	$	477,786	$	331,722	$	809,508	$	—	$	809,508
Cost of sales (a)	257,144		184,080		441,224		(20,586)		420,638
Gross Profit	220,642		147,642		368,284		20,586		388,870
Advertising and promotion expenses	34,715		36,726		71,441		—		71,441
Other selling and administrative expenses (b)	112,936		101,646		214,582		138,365		352,947
Operating Income (Loss)	72,991		9,270		82,261		(117,779)		(35,518)
Interest expense							30,059		30,059
Interest (income)							(17,282)		(17,282)
Other non-operating expense, net							5,613		5,613
Loss Before Income Taxes									$	(53,908)

	September 30,2024		September 30,2023		December 31,2023
	(In thousands)
Assets by Segment
North America	$	1,160,846	$	1,270,250	$	845,113
International	952,726		1,024,549		735,236
	2,113,572		2,294,799		1,580,349
Corporate and other	100,974		66,769		73,087
Accounts receivable, net and inventories	$	2,214,546	$	2,361,568	$	1,653,436

(a)Cost of sales included severance and other restructuring charges of approximately $2 million recorded to corporate and other.

(b)Other selling and administrative expenses included severance and other restructuring charges, the impact of inclined sleeper product recall litigation, incentive compensation, and share-based compensation of approximately $6 million, $4 million, $26 million, and $18 million, respectively, which were recorded in corporate and other.

The following tables present information regarding depreciation and amortization by segment, as well as assets by segment.


	For the Three Months Ended
	March 31, 2025		March 31, 2024
	(In thousands)
Depreciation and Amortization by Segment
North America	$	22,873	$	23,843
International	13,860		13,698
	36,733		37,541
Corporate and other	5,052		4,795
Depreciation and amortization	$	41,785	$	42,336

Segment assets were comprised of accounts receivable and inventories, net of applicable reserves and allowances.


	March 31, 2025		March 31, 2024		December 31, 2024
	(In thousands)
Assets by Segment
North America	$	646,211	$	686,694	$	757,552
International	519,192		566,572		651,738
	1,165,403		1,253,266		1,409,290
Corporate and other	126,327		89,339		95,620
Accounts receivable, net and inventories	$	1,291,730	$	1,342,605	$	1,504,910

Geographic Information

The following table presents information regarding Mattel's net sales by geographic area. Net sales are attributed to countries based on the location of the customer:

For the Three Months Ended

~~For the Nine Months Ended~~

September 30,2024

September 30,2023

September 30,2024

September 30,2023

March 31,2025

March 31,2024

(In thousands)

Net Sales by Geographic Area

North America

1491,~~108,288~~365

1477,~~146,961~~786

~~2,192,555~~

~~2,241,899~~

International

EMEA

~~401~~197,~~942~~105

~~423~~185,~~923~~239

~~837,869~~

~~874,972~~

Latin America

~~240~~64,~~563~~601

~~262~~79,~~071~~651

~~454,811~~

~~475,648~~

Asia Pacific

9373,~~111~~558

8566,~~833~~832

~~247,906~~

~~228,012~~

Total International

~~735~~335,~~616~~264

~~771~~331,~~827~~722

~~1,540,586~~

~~1,578,632~~

Net sales

1826,~~843,904~~629

1809,~~918,788~~508

~~3,733,141~~

~~3,820,531~~

22. New Accounting Pronouncements

Accounting Pronouncements Not Yet Adopted

In ~~November~~December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-0709, ~~Segment~~Income ~~Reporting~~Taxes (Topic ~~280~~740): Improvements to ~~Reportable~~Income ~~Segment~~Tax Disclosures. ASU 2023-0709 requires ~~incremental~~enhanced ~~disclosure~~income oftax ~~significant~~disclosures ~~segment expenses~~ on an annual ~~and~~basis ~~interim~~for ~~basis~~specific tocategories ~~enable~~in ~~investors~~the torate ~~develop~~reconciliation ~~more~~and ~~decision-useful~~disclosure ~~financial~~of ~~analyses~~income taxes paid by jurisdiction. The guidance in ASU 2023-0709 is effective for fiscal years beginning after December 15, ~~2023, and interim periods within fiscal years beginning after December 15,~~ 2024. Mattel is currently evaluating the impact of the adoption of ASU 2023-0709 on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires enhanced income tax disclosures on an annual basis for specific categories in the rate reconciliation and disclosure of income taxes paid by jurisdiction. The guidance in ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Mattel is currently evaluating the impact of the adoption of ASU 2023-09 on its consolidated financial statements. 25

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses for public business entities. ASU 2024-03 requires enhanced disclosures of each expense caption in the income statement to improve transparency and provide financial statement users with more detailed information about the nature, amount and timing of expenses impacting financial performance. The guidance in ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Mattel is currently evaluating the impact of the adoption of ASU 2024-03 on its consolidated financial statements.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

In the discussion that follows, "Mattel" refers to Mattel, Inc. and/or one or more of its subsidiaries.

The following discussion should be read in conjunction with the consolidated financial statements and the related notes that appear in Part I, Item 1 "Financial Statements" of this Quarterly Report on Form 10-Q. Mattel's business is seasonal with consumers making a large percentage of all toy purchases during the traditional holiday season; therefore, results of operations are most comparable to corresponding periods.

The following discussion includes currency exchange rate impact, a non-GAAP financial measure within the meaning of Regulation G promulgated by the SEC ("Regulation G"), to supplement the financial results as reported in accordance with GAAP. The currency exchange rate impact reflects the portion (expressed as a percentage) of changes in Mattel's reported results that are attributable to fluctuations in currency exchange rates. Mattel uses this non-GAAP financial measure to analyze its continuing operations and to monitor, assess, and identify meaningful trends in its operating and financial performance. Management believes that the disclosure of this non-GAAP financial measure provides useful supplemental information to investors to allow them to better evaluate ongoing business performance and certain components of Mattel's results. This measure is not, and should not be viewed as, a substitute for GAAP financial measures.

The following discussion also includes the use of gross billings, a key performance indicator. Gross billings represent amounts invoiced to customers. It does not include the impact of sales adjustments, such as trade discounts and other allowances. Mattel presents changes in gross billings as a metric for comparing its aggregate, categorical, brand, and geographic results to highlight significant trends in Mattel's business. Changes in gross billings are discussed because, while Mattel records the details of sales adjustments in its financial accounting systems at the time of sale, such sales adjustments are generally recorded by customer and not associated with categories, brands, or individual products.

Amounts shown in millions or billions within this Item 2 may not sum due to rounding.

Overview

Mattel is a leading global toy and family entertainment company and owner of one of the most iconic brand portfolios in the world. Mattel creates innovative products and experiences that inspire fans, entertain audiences, and develop children through play. Mattel is focused on the following strategy to grow its intellectual property ("IP") driven toy business and expand its entertainment offering:

•Grow toy business profitably through scaling Mattel's portfolio, optimizing operations, evolving demand creation, and growing franchise brands; and

•Expand entertainment offering to capture the full value of Mattel's IP outside the toy aisle in highly accretive business verticals, by growing franchise brands and accelerating content, consumer products, and digital and live experiences.

Mattel is the owner of a portfolio of iconic brands and partners with global entertainment companies to license other IP. Mattel's portfolio of owned and licensed brands and products are organized into the following categories:

Dolls—including brands such as Barbie, American Girl, Disney Princess, ~~and~~ Disney Frozen, Monster High, and Polly Pocket. Mattel's Dolls portfolio is driven by the flagship Barbie brand and a collection of complementary brands offered globally. Empowering girls since 1959, Barbie has inspired the limitless potential of every girl by showing them that they can be anything. Monster High, a character-driven franchise, engages fans of all ages, encouraging them to be their authentic selves and celebrate what makes them unique. American Girl, with an extensive portfolio of dolls and accessories, content, gaming, and lifestyle products, is best known for imparting valuable life lessons that instill confidence through its inspiring dolls and books, featuring ~~diverse~~ characters from past and present.

Infant, Toddler, and Preschool—including brands such as Fisher-Price (including Little People and Fisher-Price Wood), Imaginext, and Thomas & Friends. As a leader in play and child development, Fisher-Price's ~~mission~~ is dedicated to ~~help~~giving families the best possible start to life by making the most fun, enriching products for infants, toddlers, and preschoolers. Thomas & Friends is an award-winning preschool train brand franchise that ~~brings~~lays ~~meaningful~~the ~~life~~tracks ~~lessons~~to ofinspire, ~~friendship~~entertain, and ~~teamwork~~develop toyoung ~~kids~~train fans through toys, content, live events, and other consumer products.

~~In the first quarter of 2024, Mattel further divided its~~ Infant, Toddler, and Preschool ~~category~~is further divided into three subcategories. The first subcategory is Fisher-Price, the power brand, which includes the core Infant, Little People, and Newborn product lines, as well as the recently launched Fisher-Price Wood product line. The second subcategory is Preschool Entertainment, which includes owned IP such as Thomas & Friends and Barney, Mattel's character based Imaginext line, and partner entertainment brands. The third subcategory is Baby Gear and Power Wheels, in which Mattel ~~has~~is ~~decided to~~ strategically out-~~license~~licensing or ~~exit~~exiting certain product lines.

Vehicles—including brands such as Hot Wheels (including Hot Wheels Monster Trucks and Hot Wheels ~~Mario Kart (Nintendo~~RC)), Matchbox, and Cars (Disney Pixar). In production for over 50 years, Hot Wheels continues to push the limits of performance and design, and ignites and nurtures the challenger spirit of kids, adults, and collectors. From die-cast vehicles to tracks, playsets, and accessories, the Mattel Vehicles portfolio has broad appeal that engages and excites fans of all ages.

Action Figures, Building Sets, Games, and Other—including brands such as Masters of the Universe, MEGA, UNO, Jurassic World (NBCUniversal), Minecraft (Microsoft), WWE, and Star Wars (Disney's Lucasfilm). Mattel's Action Figures portfolio is comprised of product lines associated with licensed entertainment franchises, such as Jurassic World and WWE, as well as product lines from Mattel-owned IP, such as Masters of the Universe. As the challenger brand in Building Sets, MEGA inspires creativity through authentic building experiences for builders of all ages and fans of global franchises. Within Games, UNO is the classic matching card game that is easy to learn and fast fun for everyone. Other includes Plush, which contains products associated with movie releases from licensed entertainment franchises, as well as Mattel-owned IP.

Recent Developments

~~During~~Mattel's net sales in the ~~third~~first quarter of 2025 increased 2% compared to the first quarter of 2024,. ~~Mattel~~Gross ~~continued~~margin expanded to ~~execute~~49.4% ~~its~~in ~~multi-year~~the ~~strategy~~first quarter of 2025 compared to ~~grow~~48.0% ~~its~~in ~~IP-driven~~the ~~toy~~first ~~business~~quarter of 2024, with benefits from lower inventory management costs, the OPG program, and ~~expand~~favorable ~~its~~foreign ~~entertainment~~currency ~~offering~~exchange, partially offset by cost inflation. Additionally, Mattel ~~achieved~~ended ~~gross~~the ~~margin~~first ~~expansion,~~quarter ~~continued~~with toa ~~improve~~cash inbalance ~~profitability~~of $1.24 billion, compared to $1.13 billion in the ~~third~~first quarter of ~~2023,~~2024 ~~and~~after ~~ended~~$460.0 million ~~the~~of ~~quarter~~share inrepurchases aduring ~~strong~~the ~~financial~~trailing ~~position~~twelve months.

~~Mattel's~~The ~~third~~United ~~quarter~~States ~~net~~has ~~sales~~recently ~~declined~~announced 4%changes ~~compared~~ to ~~the~~its ~~third~~global ~~quarter~~trade ~~of 2023~~policy, ~~which~~including ~~benefited~~significant ~~from~~tariffs ~~the~~on ~~success~~imports offrom ~~the~~China, ~~Barbie movie. Mattel's third quarter results included improvement to operating cash flows~~Vietnam, ~~as well as gross margin expansion to 53.1%~~Mexico, ~~from 51.0% in the third quarter of 2023~~Canada, ~~with benefits from supply chain~~ and other ~~efficiencies,~~countries. ~~the~~These ~~Optimizing for Profitable Growth program ("OPG program")~~actions, ~~favorable foreign currency exchange,~~ and ~~cost~~retaliatory ~~deflation.~~tariffs ~~Earnings~~imposed ~~per~~by ~~share~~other incountries ~~the~~on ~~third~~U.S. ~~quarter~~goods ofand ~~2024~~exports, ~~increased~~have led to ~~$1.09,~~significant ~~compared~~volatility toand ~~$0.41~~uncertainty in ~~the~~global ~~third quarter of 2023~~markets.

~~Mattel~~New ~~ended~~or ~~the~~increased ~~third~~tariffs ~~quarter~~and ~~with~~other abarriers ~~cash~~to ~~balance~~trade, especially in light of ~~$723~~recent comments and executive orders made by the United States, could further impact or exacerbate these conditions.5 ~~million~~Historically, ~~compared~~tariffs have led to ~~$455~~increased trade and political tensions.7 ~~million~~Political intensions ~~the~~as ~~third~~a ~~quarter~~result of ~~2023.~~trade ~~Cash~~policies ~~increased~~could ~~primarily~~reduce ~~due~~trade tovolume, ~~Mattel's~~investment, ~~cash~~and ~~flows~~other ~~from~~economic ~~operations~~activities between major international economies, ~~which~~resulting ~~were~~in ~~$887~~a material adverse effect on global economic conditions and on the stability of global financial markets.~~8 million~~ ~~during~~There is substantial uncertainty about the ~~trailing~~duration ~~twelve~~of ~~months~~existing tariffs, ~~due~~potential changes to anexisting ~~increase~~tariffs, inand ~~net~~whether ~~income,~~additional ~~excluding~~tariffs ~~the~~may ~~impact~~be ofimposed, ~~non-cash~~modified, ~~items~~or suspended, and ~~improved~~the ~~working~~impacts ~~capital~~of such actions on Mattel's business. ~~This~~While ~~increase~~the ~~was~~situation ~~partially~~remains ~~offset~~fluid, byMattel ~~cash~~is ~~used~~continuing ~~for~~to ~~share~~evaluate ~~repurchases~~these developments and ~~capital~~taking ~~expenditures,~~actions ~~including~~designed to mitigate the ~~acquisition~~anticipated ofcost aimpact ~~property~~on ~~that~~its ~~will~~business, ~~serve~~such as ~~Mattel's~~further ~~new~~diversifying ~~global~~its ~~design~~supply ~~center~~chain, ~~which~~optimizing ~~will~~product ~~replace~~sourcing aand ~~facility~~product ~~that~~mix, isand ~~currently~~taking ~~leased.~~pricing actions where necessary.

OnMattel ~~February~~is 5,operating ~~2024,~~in ~~the~~an ~~Board~~uncertain ofmacro-economic ~~Directors~~environment ~~authorized~~with asignificant ~~$1.00~~volatility ~~billion~~that ~~share~~may ~~repurchase~~impact ~~program~~consumer demand. ~~During~~To the ~~first~~extent ~~nine~~the ~~months~~macro-economic ofenvironment ~~2024~~worsens, it may have a material effect on Mattel's ~~executed~~results ~~$268~~of operations and financial condition.~~3 million~~ ofRefer ~~share~~to ~~repurchases~~Part ~~under~~I, Item 1A "Risk Factors" in the ~~program~~2024 Annual Report and Part II, Item 1A "Risk Factors" of this Quarterly Report on Form 10-Q for further discussion regarding potential impacts on Mattel's business.

Additionally, in July 2024, Mattel entered into a new $1.40 billion revolving credit facility (the "New Revolving Credit Facility"), which replaced its prior revolving credit facility (the "Prior Revolving Credit Facility"). The New Revolving Credit Facility matures in July 2029.

Mattel is operating in a macro-economic environment that may impact consumer demand. To the extent the macro-economic environment worsens, it may have a material effect on Mattel's results of operations and financial condition. Refer to Part I, Item 1A "Risk Factors" in the 2023 Annual Report on Form 10-K for further discussion regarding potential impacts on Mattel's business.

Results of Operations—~~Third~~First Quarter

Consolidated Results

The following table presents Mattel's consolidated results for the ~~third~~first quarter of ~~2024~~2025 and ~~2023~~2024:

	For the Three Months Ended								Year/Year Change
	September 30, 2024				September 30, 2023
	March 31, 2025				March 31, 2024
	Amount		% of NetSales		Amount		% of NetSales		%		Basis Pointsof Net Sales
	(In millions, except percentage and basis point information)
Net sales	$	~~1,843~~826.96			$	~~1,918~~809.85			-42	%
Cost of sales	~~864~~418.95		4650.96	%	~~940~~420.96		4952.0	%	-81	%	(~~210~~140)
Gross profit	~~979~~408.01		5349.14	%	~~977~~388.9		5148.0	%	—5	%	~~210~~140
Advertising and promotion expenses	~~105~~70.02		58.75	%	~~124~~71.34		68.58	%	-162	%	(8030)
Other selling and administrative expenses	~~385~~390.79		2047.93	%	~~379~~352.89		1943.86	%	211	%	~~110~~370
Operating income	488.3		26.5	%	473.9		24.7	%	3	%	180
Operating loss	(53.0)		-6.4	%	(35.5)		-4.4	%	49	%	(200)
Interest expense	29.42		13.65	%	30.71		13.67	%	-43	%	—(20)
Interest (income)	(916.80)		-01.59	%	(417.63)		-0.2.1	%	~~114~~-8	%	~~(30)~~20
Other non-operating (income), net	(2.9)				(2.4)
Other non-operating expense, net	13.0				5.6
Income before income taxes	471.7		25.6	%	450.1		23.5	%	5	%	210
Loss before income taxes	(79.3)		-9.6	%	(53.9)		-6.7	%	47	%	(290)
Provision for income taxes	106.4				309.3
(Benefit) from income taxes	(30.6)				(20.8)
(Income) from equity method investments	(78.04)				(54.68)
Net income	$	372.4	20.2	%	$	146.3	7.6	%	154	%	1,260
Net loss	$	(40.3)	-4.9	%	$	(28.3)	-3.5	%	43	%	(140)

Sales

Net sales in the ~~third~~first quarter of ~~2024~~2025 were $1826.846 ~~billion~~million, aan ~~decrease~~increase of $7417.91 million, or 42%, as compared to $1809.925 ~~billion~~million in the ~~third~~first quarter of ~~2023~~2024. The ~~decrease~~increase in net sales was primarily due to aan ~~decrease~~increase in gross billings of $7025.62 million, partially offset by an increase in sales adjustments of $8.1 million.

Gross billings represent amounts invoiced to a customer and do not include the impact of sales adjustments, such as trade discounts and other allowances. Changes in gross billings are discussed below because, while Mattel records the details of sales adjustments in its financial accounting systems at the time of sale, such sales adjustments are generally recorded by customer and are not associated with categories, brands, or individual products. The following tables provide a summary of Mattel's consolidated gross billings by categories, along with supplemental information by brand, for the ~~third~~first quarter of ~~2024~~2025 and ~~2023~~2024:

	For the Three Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30,2024		September 30,2023
	March 31,2025		March 31,2024
	(In millions, except percentage information)
Gross Billings by Categories
Dolls	$	~~757~~296.16	$	~~884~~294.5	~~-14~~1	%	-12	%
Infant, Toddler, and Preschool	~~349~~126.84		~~361~~135.10		-36	%	-12	%
Vehicles	~~580~~308.05		~~518~~297.57		124	%	-12	%
Action Figures, Building Sets, Games, and Other	~~364~~192.37		~~357~~171.7		212	%	-1	%
Gross Billings	$	~~2,051~~924.12	$	~~2,121~~898.89	-3	%	-12	%
Supplemental Gross Billings Disclosure
Gross Billings by Top 3 Power Brands
Barbie	$	~~500~~173.68	$	~~605~~177.15	-172	%	—-2	%
Hot Wheels	~~508~~268.28		~~454~~258.81		124	%	-12	%
Fisher-Price (a)	265.4		264.3		—	%	-1	%
Fisher-Price	90.1		93.4		-3	%	-2	%
Other	~~777~~391.05		~~797~~370.60		-36	%	-12	%
Gross Billings	$	~~2,051~~924.12	$	~~2,121~~898.89	-3	%	-12	%

~~(a)~~Gross ~~Beginning~~billings were $924.2 million in the first quarter of ~~2024~~2025, an increase of $25.2 million, or 3%, as compared to $898.9 million in the ~~Fisher-Price~~first ~~power~~quarter ~~brand~~of 2024, with an unfavorable impact from changes in currency exchange rates of two percentage points. The increase in gross billings was ~~revised~~primarily due to ~~exclude~~higher ~~Baby~~billings ~~Gear~~of Action Figures, Building Sets, Games, and ~~Imaginext~~Other, ~~products.~~Vehicles, ~~Prior~~and ~~period~~Dolls ~~amounts~~products, ~~have~~partially ~~been~~offset ~~reclassified~~by tolower ~~conform~~billings toof ~~the~~Infant, ~~current~~Toddler, ~~presentation~~and Preschool products.

~~Gross~~Dolls gross billings ~~were~~increased ~~$2.05 billion in the third quarter of 2024~~1%, ~~a decrease~~ of ~~$70.6 million,~~which ~~or 3~~2%, aswas ~~compared~~due to ~~$2.12 billion~~higher inbillings ~~the third quarter~~ of ~~2023,~~Disney ~~with~~Princess anproducts ~~unfavorable~~and ~~impact~~2% ~~from changes in currency exchange rates of one percentage point. The decrease in gross billings~~ was ~~primarily~~ due to ~~lower~~higher billings of ~~Dolls~~Wicked ~~and Infant, Toddler, and Preschool~~ products, partially offset by ~~higher~~lower billings of ~~Vehicles~~Trolls ~~and~~products ~~Action~~of ~~Figures,~~2% ~~Building~~and ~~Sets,~~lower ~~Games,~~billings ~~and~~of ~~Other~~Barbie products of 1%.

~~Dolls~~Infant, Toddler, and Preschool gross billings decreased 146%, of which 128% was due to lower billings of ~~Barbie,~~Baby ~~which~~Gear ~~benefited~~and ~~from~~Power ~~the~~Wheels ~~Barbie~~products, ~~movie~~due into the ~~prior~~continued ~~year,~~strategic ~~and~~exit 2%from ~~was~~certain ~~due~~product tolines ~~lower~~in ~~billings~~Baby ofGear ~~Trolls~~and ~~(NBCUniversal)~~Power ~~products~~Wheels.

~~Infant,~~Vehicles ~~Toddler, and Preschool~~ gross billings ~~decreased~~increased 34%, primarily due to ~~lower~~higher billings of ~~Baby~~Hot ~~Gear and Power~~ Wheels products.

~~Vehicles~~Action Figures, Building Sets, Games, and Other gross billings increased 12%, of which 19% was due to higher billings of Action Figures products, primarily due to higher billings of ~~Hot~~Minecraft ~~Wheels~~and Jurassic World products in advance of their theatrical releases in 2025, partially offset by lower billings of Building Sets products of 8%.

~~Action~~Sales ~~Figures,~~adjustments ~~Building~~generally ~~Sets~~represent arrangements with Mattel's customers to provide sales incentives, ~~Games~~support customer promotions, and ~~Other~~provide ~~gross~~allowances ~~billings~~for ~~increased~~returns 2%and defective merchandise. Such programs are based primarily on customer purchases, customer performance of ~~which~~specified 8%promotional ~~was~~activities, ~~due~~and other specified factors such as sales to ~~higher~~consumers. ~~billings~~Additionally, sales adjustments may include foreign currency transaction gains and losses from the remeasurement of ~~Games~~accounts ~~products~~receivable denominated in currencies that are different from the relevant entity's functional currency. Sales adjustments increased to $97.5 million in the first quarter of 2025, ~~partially~~from ~~offset~~$89.4 bymillion ~~lower~~in ~~billings~~the first quarter of ~~Other~~2024. ~~products~~Sales adjustments as a percentage of 3net sales increased to 11.8% ~~and~~in ~~lower~~the ~~billings~~first quarter of ~~Building~~2025, ~~Sets~~as ~~products~~compared ofto 311.0% in the first quarter of 2024. The increase in sales adjustments as a percentage of net sales was primarily due to higher promotional activities.

Sales adjustments generally represent arrangements with Mattel's customers to provide sales incentives, support customer promotions, and provide allowances for returns and defective merchandise. Such programs are based primarily on customer purchases, customer performance of specified promotional activities, and other specified factors such as sales to consumers. Additionally, sales adjustments may include foreign currency transaction gains and losses from the remeasurement of accounts receivable denominated in currencies that are different from the relevant entity's functional currency. Sales adjustments increased to $207.2 million in the third quarter of 2024, from $203.0 million in the third quarter of 2023. Sales adjustments as a percentage of net sales increased to 11.2% in the third quarter of 2024, as compared to 10.6% in the third quarter of 2023. The increase in sales adjustments as a percentage of net sales was primarily due to a shift in sales channel mix resulting in a higher proportion of sales with higher average sales adjustment rates.

Cost of Sales

Cost of sales decreased by $752.91 million, or 81%, to $~~864~~418.95 million in the ~~third~~first quarter of ~~2024~~2025 from $~~940~~420.96 million in the ~~third~~first quarter of ~~2023~~2024. Within cost of sales, product and other costs decreased by $658.28 million, or 93%, to $~~696~~310.13 million in the ~~third~~first quarter of ~~2024~~2025 from $~~761~~319.31 million in the ~~third~~first quarter of ~~2023~~2024. ~~Freight~~Royalty ~~and~~expense ~~logistics~~increased ~~expenses decreased~~ by $76.04 million, or 818%, to $8442.9 5 million in the ~~third~~first quarter of ~~2024~~2025 from $9236.0 1 million in the ~~third~~first quarter of ~~2023~~2024. ~~Royalty~~Freight ~~expense~~and ~~decreased~~logistics byexpenses ~~$3.7 million,~~were orrelatively ~~4%,~~consistent toat $8365.97 million in the ~~third~~first quarter of ~~2024~~2025, ~~from~~as compared to $8765.65 million in the ~~third~~first quarter of ~~2023~~2024.

Gross Margin

Gross margin increased to 5349.14% in the ~~third~~first quarter of ~~2024~~2025 from 5148.0% in the ~~third~~first quarter of ~~2023~~2024. The increase in gross margin ~~included~~was ~~supply~~primarily ~~chain~~due to lower inventory management costs and other ~~efficiencies~~ of ~~190~~130 basis points, ~~incremental~~primarily ~~realized~~lower ~~savings~~inventory ~~from~~obsolescence ~~the~~and ~~OPG~~close-out ~~program of 80 basis points~~sales, ~~favorable~~and ~~foreign~~incremental ~~currency~~realized ~~exchange~~savings offrom 70the ~~basis~~OPG ~~points,~~program ~~and cost deflation~~ of 50110 basis points, partially offset by ~~unfavorable~~cost ~~mix~~inflation of ~~180~~100 basis points.

Advertising and Promotion Expenses

Advertising and promotion expenses primarily consist of: (i) media costs, which include the media, planning, and buying fees for television, print, and online advertisements, (ii) non-media costs, which include commercial and website production, merchandising, and promotional costs, (iii) retail advertising costs, which include consumer direct catalogs, and (iv) ~~generic~~general advertising costs, which include trade show costs. Advertising and promotion expenses as a percentage of net sales ~~decreased~~were torelatively 5consistent at 8.75% in the ~~third~~first quarter of ~~2024~~2025, as compared to 68.58% in the ~~third~~first quarter of ~~2023, primarily due to a shift in the expected timing of advertising and promotion programs to the fourth quarter of~~ 2024.

Other Selling and Administrative Expenses

Other selling and administrative expenses were $~~385~~390.79 million, or 2047.93% of net sales, in the ~~third~~first quarter of ~~2024~~2025, an increase of $537.9 million, as compared to $~~379~~352.89 million, or 1943.86% of net sales, in the ~~third~~first quarter of ~~2023~~2024. The increase in other selling and administrative expenses was primarily due to higher severance and restructuring charges of $15.1 million, higher expenses related to inclined sleeper product recall litigation of $10.4 million, higher employee compensation ~~increases~~of $10.0 million, and higher ~~incentive~~outside ~~compensation~~services spend and other administrative expenses of $258.2 million, partially offset by realized savings from cost savings programs of $79.5 million.

Interest Expense

Interest expense was $29.42 million in the ~~third~~first quarter of ~~2024~~2025, relatively flat as compared to $30.71 million in the ~~third~~first quarter of ~~2023~~2024.

Interest Income

Interest income ~~increased~~was by $516.20 million ~~to $9.8 million~~ in the ~~third~~first quarter of ~~2024~~2025, ~~from~~relatively ~~$4.6~~flat ~~million~~as incompared ~~the third quarter of 2023, primarily due~~ to ~~higher~~$17.3 ~~average~~million ~~invested cash balances~~ in the ~~third~~first quarter of 2024.

~~Provision~~Benefit ~~for~~from Income Taxes

Mattel's ~~provision~~benefit ~~for~~from income taxes was $~~106~~30.46 million in the ~~third~~first quarter of ~~2024~~2025, as compared to $~~309~~20.38 million in the ~~third~~first quarter of ~~2023~~2024. The ~~decrease~~increase in ~~provision~~benefit ~~for~~from income taxes was ~~primarily~~driven ~~due~~by tohigher ~~changes~~loss inbefore income taxes and higher discrete income ~~taxes~~tax benefits in the first three months of 2025. During the three months ended ~~September~~March 3031, ~~2023~~2025, Mattel recognized a net discrete ~~income~~ tax ~~expense~~benefit of $~~200~~11.74 million, ~~which~~primarily ~~included~~related ~~the~~to ~~establishment of~~ a ~~valuation~~change ~~allowance~~ of ~~$212.4 million~~its onindefinite ~~certain~~reinvestment ~~foreign~~assertion ~~deferred~~relating ~~tax~~to ~~assets during the third quarter of 2023 resulting from the intra-group transfer of~~ certain IPforeign ~~rights,~~subsidiary ~~partially offset by other discrete income tax benefits of $11~~earnings.~~7 million.~~ During the three months ended ~~September~~March 3031, 2024, Mattel recognized a net discrete income tax benefit of $38.4 million, primarily related to ~~reassessments~~tax ofelections ~~prior~~filed ~~years'~~to ~~tax~~amortize ~~liabilities,~~certain ~~partially~~intangible ~~offset~~assets bytransferred ~~the~~as ~~establishment~~part of aMattel's ~~valuation~~intra-group ~~allowance~~intellectual onproperty ~~certain~~rights ~~foreign~~transfer ~~deferred~~of $10.1 million, partially offset by interest related to unrecognized tax ~~assets~~benefits.

The Organization for Economic Co-operation and Development ("OECD") reached an agreement among various countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as Pillar Two. Many countries continue to announce changes in their tax laws and regulations based on the Pillar Two rules. Mattel is continuing to evaluate the impact of these proposed and enacted legislative changes as new guidance becomes available. Some of the legislative changes could impact Mattel's effective tax rate and tax liabilities. When and how these laws and regulations are adopted or enacted by various countries in which Mattel operates could increase tax complexity and uncertainty and may adversely affect Mattel's worldwide effective tax rate, income tax expense and cash flows. Mattel does not expect the provisions effective in 2024 to have a materially adverse impact on its results of operations, financial position, or cash flows.

Segment Results

North America Segment

~~Beginning~~The infollowing ~~the~~tables ~~first~~provide ~~quarter~~a summary of ~~2024,~~ Mattel's ~~American~~net ~~Girl~~sales, ~~business~~segment ~~was~~operating ~~integrated~~income, ~~into~~and ~~its~~gross ~~North~~billings ~~America~~by ~~commercial~~categories, ~~organization~~along ~~and~~with issupplemental ~~reported~~information ~~within~~by brand, for the North America ~~operating~~ segment. ~~Prior~~for to the first quarter of ~~2024,~~2025 ~~Mattel's~~and ~~American Girl business was a separate reportable operating segment. Prior period amounts have been reclassified to conform to the current period presentation.~~2024:

The following tables provide a summary of Mattel's net sales, segment operating income, and gross billings by categories, along with supplemental information by brand, for the North America segment for the third quarter of 2024 and 2023:


	For the Three Months Ended				% Change as Reported		Currency Exchange Rate Impact
	March 31, 2025		March 31, 2024
	(In millions, except percentage information)
Net Sales	$	491.4	$	477.8	3	%	—	%
Segment Operating Income	83.1		73.0		14	%

	For the Three Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30,2024		September 30,2023
	(In millions, except percentage information)
Net Sales	$	1,108.3	$	1,147.0	-3	%	—	%
Segment Operating Income	412.4		401.1		3	%

Net sales for the North America segment in the first quarter of 2025 were $491.4 million, an increase of $13.6 million, or 3%, as compared to $477.8 million in the first quarter of 2024. The increase in net sales was primarily due to an increase in gross billings of $19.6 million.

Net sales for the North America segment in the third quarter of 2024 were $1.11 billion, a decrease of $38.7 million, or 3%, as compared to $1.15 billion in the third quarter of 2023. The decrease in net sales was primarily due to a decrease in gross billings of $36.6 million.


	For the Three Months Ended				% Change as Reported		Currency Exchange Rate Impact
	March 31, 2025		March 31, 2024
	(In millions, except percentage information)
Gross Billings by Categories
Dolls	$	172.4	$	164.7	5	%	—	%
Infant, Toddler, and Preschool	80.1		80.5		—	%	—	%
Vehicles	149.5		150.2		—	%	—	%
Action Figures, Building Sets, Games, and Other	123.9		111.0		12	%	—	%
Gross Billings	$	526.0	$	506.4	4	%	—	%

Supplemental Gross Billings Disclosure
Gross Billings by Top 3 Power Brands
Barbie	$	92.4	$	92.4	—	%	—	%
Hot Wheels	125.5		126.8		-1	%	—	%
Fisher-Price	58.1		53.7		8	%	—	%
Other	250.0		233.5		7	%	—	%
Gross Billings	$	526.0	$	506.4	4	%	—	%

	For the Three Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30,2024		September 30,2023
	(In millions, except percentage information)
Gross Billings by Categories
Dolls	$	442.3	$	512.7	-14	%	—	%
Infant, Toddler, and Preschool	228.0		230.6		-1	%	—	%
Vehicles	288.5		263.4		10	%	—	%
Action Figures, Building Sets, Games, and Other	225.5		214.1		5	%	—	%
Gross Billings	$	1,184.3	$	1,220.9	-3	%	—	%
Supplemental Gross Billings Disclosure
Gross Billings by Top 3 Power Brands
Barbie	$	285.1	$	349.9	-19	%	—	%
Hot Wheels	249.7		225.7		11	%	—	%
Fisher-Price (a)	168.5		166.5		1	%	—	%
Other	481.0		478.7		—	%	—	%
Gross Billings	$	1,184.3	$	1,220.9	-3	%	—	%

Gross billings for the North America segment were $526.0 million in the first quarter of 2025, an increase of $19.6 million, or 4%, as compared to $506.4 million in the first quarter of 2024. The increase in the North America segment gross billings was due to higher billings of Action Figures, Building Sets, Games, and Other, and Dolls products.

~~(a)~~Dolls ~~Beginning~~gross inbillings ~~the~~increased ~~first~~5%, ~~quarter~~ of ~~2024,~~which ~~the~~2% ~~Fisher-Price~~was ~~power~~due ~~brand~~to higher billings of Wicked products and 2% was ~~revised~~due to ~~exclude~~higher ~~Baby~~billings ~~Gear~~of ~~and~~Disney ~~Imaginext~~Princess products., ~~Prior~~partially ~~period~~offset ~~amounts~~by ~~have~~lower ~~been~~billings ~~reclassified~~of toTrolls ~~conform~~products toof ~~the current presentation~~2%.

~~Gross billings for the North America segment were $1.18 billion in the third quarter of 2024~~Infant, ~~a decrease of $36.6 million~~Toddler, orand ~~3%,~~Preschool ~~as compared to $1.22 billion in the third quarter of 2023. The decrease in the North America segment~~ gross billings ~~was~~were ~~due~~flat toyear-over-year, with lower billings of ~~Dolls~~Baby Gear and ~~Infant,~~Power ~~Toddler,~~Wheels ~~and~~products ~~Preschool~~of ~~products~~11%, ~~partially~~substantially offset by higher billings of ~~Vehicles~~Preschool ~~and~~Entertainment ~~Action~~products ~~Figures,~~of ~~Building~~6% ~~Sets,~~and ~~Games,~~higher ~~and~~billings ~~Other~~of Fisher-Price products of 5%.

Vehicles gross billings were flat year-over-year.

Action Figures, Building Sets, Games, and Other gross billings increased 12%, of which 22% was due to higher billings of Action Figures products, primarily due to higher billings of Jurassic World and Minecraft products in advance of their theatrical releases in 2025, partially offset by lower billings of Building Sets products of 8% and lower billings of Games products of 3%.

Sales adjustments increased to $34.6 million in the first quarter of 2025 from $28.6 million in the first quarter of 2024. Sales adjustments as a percentage of net sales increased to 7.0% in the first quarter of 2025, as compared to 6.0% in the first quarter of 2024. The increase in sales adjustments as a percentage of net sales was primarily due to higher promotional activities.

~~Dolls~~Cost ~~gross~~of ~~billings~~sales ~~decreased~~were ~~14%,~~relatively ~~primarily~~consistent ~~due~~at to$256.3 million ~~lower~~in ~~billings~~the offirst ~~Barbie,~~quarter ~~which~~of ~~benefited~~2025 ~~from~~as ~~the~~compared ~~Barbie~~to ~~movie~~$257.1 million in the ~~prior~~first ~~year~~quarter of 2024.

~~Infant,~~Gross ~~Toddler,~~margin ~~and~~increased ~~Preschool~~to ~~gross~~47.8% ~~billings~~in ~~decreased~~the 1first quarter of 2025 from 46.2%, in the first quarter of 2024. The increase in gross margin was primarily due to lower ~~billings~~inventory management costs of ~~Baby~~120 ~~Gear~~basis points, including lower inventory obsolescence and ~~Power~~close-out ~~Wheels~~sales, ~~products~~and incremental realized savings from the OPG program of 110 basis points, partially offset by cost inflation of 70 basis points.

~~Vehicles~~North ~~gross~~America ~~billings~~segment ~~increased~~operating ~~10%~~income was $83.1 million in the first quarter of 2025, as compared to $73.0 million in the first quarter of 2024, primarily due to higher ~~billings~~gross profit of ~~Hot~~$14.4 ~~Wheels products~~million.

Action Figures, Building Sets, Games, and Other gross billings increased 5%, of which 8% was due to higher billings of Games products and 3% was due to higher billings of Action Figures products, partially offset by lower billings of Building Sets products of 3% and lower billings of Other products of 3%.

Sales adjustments increased to $76.0 million in the third quarter of 2024 from $73.9 million in the third quarter of 2023. Sales adjustments as a percentage of net sales was relatively consistent at 6.9% in the third quarter of 2024, as compared to 6.4% in the third quarter of 2023.

Cost of sales decreased by $38.6 million, or 7%, to $534.8 million in the third quarter of 2024 from $573.4 million in the third quarter of 2023, primarily due to a decrease in product and other costs of $29.4 million and a decrease in freight and logistics expenses of $8.4 million.

Gross margin increased to 51.7% in the third quarter of 2024 from 50.0% in the third quarter of 2023. The increase in gross margin included supply chain and other efficiencies of 200 basis points, incremental realized savings from the OPG program of 80 basis points, and cost deflation of 60 basis points, partially offset by unfavorable mix of 170 basis points.

North America segment operating income was $412.4 million in the third quarter of 2024, as compared to $401.1 million in the third quarter of 2023, primarily due to lower advertising and promotion expenses of $15.0 million, partially offset by higher other selling and administrative expenses of $3.6 million.

International Segment

The following tables provide a summary of Mattel's net sales, segment operating income, and gross billings by categories, along with supplemental information by brand, for the International segment for the ~~third~~first quarter of ~~2024~~2025 and ~~2023~~2024:

For the Three Months Ended

% Change asReported

CurrencyExchange RateImpact

September 30,2024

September 30,2023

March 31,2025

March 31,2024

(In millions, except percentage information)

Net Sales

~~735~~335.63

~~771~~331.87

-51

-24

Segment Operating Income

~~217~~23.73

~~202~~9.53

7152

Net sales for the International segment in the ~~third~~first quarter of ~~2024~~2025 were $~~735~~335.63 million, aan ~~decrease~~increase of $363.25 million, or 51%, as compared to $~~771~~331.87 million in the ~~third~~first quarter of ~~2023~~2024. The ~~decrease~~increase in net sales was primarily due to aan ~~decrease~~increase in gross billings of $345.17 million, partially offset by an increase in sales adjustments of $2.1 million.

	For the Three Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30,2024		September 30,2023
	March 31,2025		March 31,2024
	(In millions, except percentage information)
Gross Billings by Categories
Dolls	$	~~314~~124.82	$	~~371~~129.78	-154	%	-14	%
Infant, Toddler, and Preschool	~~121~~46.83		~~130~~54.5		-715	%	-34	%
Vehicles	~~291~~158.59		~~255~~147.05		148	%	-25	%
Action Figures, Building Sets, Games, and Other	~~138~~68.87		~~143~~60.67		-313	%	-24	%
Gross Billings	$	~~866~~398.82	$	~~900~~392.95	-41	%	-24	%
Supplemental Gross Billings Disclosure
Gross Billings by Top 3 Power Brands
Barbie	$	~~215~~81.54	$	~~255~~85.21	-164	%	-13	%
Hot Wheels	~~258~~143.43		~~229~~131.13		139	%	-25	%
Fisher-Price (a)	96.9		97.7		-1	%	-3	%
Fisher-Price	32.1		39.6		-19	%	-5	%
Other	~~296~~141.14		~~318~~136.94		-74	%	-24	%
Gross Billings	$	~~866~~398.82	$	~~900~~392.95	-41	%	-24	%

~~(a)~~Gross ~~Beginning~~billings for the International segment were $398.2 million in the first quarter of 2025, an increase of $5.7 million, or 1%, as compared to $392.5 million in the first quarter of 2024, with an unfavorable impact from changes in currency exchange rates of four percentage points. The increase in the ~~Fisher-Price~~International ~~power~~segment ~~brand~~gross billings was ~~revised~~due to ~~exclude~~higher ~~Baby~~billings ~~Gear~~of Vehicles and ~~Imaginext~~Action Figures, Building Sets, Games, and Other products., ~~Prior~~partially ~~period~~offset ~~amounts~~by ~~have~~lower ~~been~~billings ~~reclassified~~of toInfant, ~~conform~~Toddler, toand ~~the~~Preschool ~~current~~and ~~presentation~~Dolls products.

~~Gross~~Dolls gross billings ~~for~~decreased ~~the International segment were $866.8 million in the third quarter of 2024~~4%, ~~a decrease~~ of ~~$34.1 million,~~which ~~or 4~~3%, aswas ~~compared~~due to ~~$900.9~~lower ~~million~~billings ~~in the third quarter~~ of ~~2023,~~Polly ~~with~~Pocket anproducts ~~unfavorable~~and ~~impact~~3% ~~from changes in currency exchange rates of two percentage points. The decrease in the International segment gross billings~~ was due to lower billings of ~~Dolls,~~Barbie ~~Infant, Toddler, and Preschool, and Action Figures, Building Sets, Games, and Other~~ products, partially offset by higher billings of ~~Vehicles~~Disney Princess products of 3%.

~~Dolls~~Infant, Toddler, and Preschool gross billings decreased 15%, of which 1114% was due to lower billings of ~~Barbie,~~Fisher-Price ~~which benefited from the Barbie movie in the prior year, 2% was due to lower billings of Polly Pocket~~ products~~, and 2% was due to lower billings of Trolls (NBCUniversal) products~~.

~~Infant,~~Vehicles ~~Toddler, and Preschool~~ gross billings ~~decreased~~increased 78%, ofprimarily ~~which 3% was~~ due to ~~lower~~higher billings of ~~Baby~~Hot ~~Gear and Power~~ Wheels products ~~and 3% was due to lower billings of Preschool Entertainment products~~.

~~Vehicles gross billings increased 14%, primarily due to higher billings of Hot Wheels products.~~33

Action Figures, Building Sets, Games, and Other gross billings ~~decreased~~increased 313%, of which 414% was due to ~~lower~~higher billings of ~~Other~~Action Figures products, 3%primarily ~~was~~ due to ~~lower~~higher billings of ~~Building~~Minecraft ~~Sets~~ products in advance of its theatrical release in 2025, and 39% was due to ~~lower~~higher billings of ~~Action~~Games ~~Figures~~ products, partially offset by ~~higher~~lower billings of ~~Games~~Building Sets products of 79%.

34Sales adjustments increased to $62.9 million in the first quarter of 2025 from $60.8 million in the first quarter of 2024. Sales adjustments as a percentage of net sales were relatively consistent at 18.8% in the first quarter of 2025, as compared to 18.3% in the first quarter of 2024.

~~Sales~~Cost ~~adjustments~~of ~~increased~~sales todecreased by $~~131~~8.26 million, inor ~~the~~5%, ~~third~~to ~~quarter of 2024 from~~ $~~129~~175.15 million in the ~~third~~first quarter of ~~2023.~~2025 ~~Sales~~from ~~adjustments as a percentage of net sales increased to 17~~$184.8%1 million in the ~~third~~first quarter of 2024, ~~as compared to 16.7% in the third quarter of 2023. The increase in sales adjustments as a percentage of net sales was~~ primarily due to a ~~shift~~decrease in ~~sales~~product ~~channel~~and ~~mix~~other ~~resulting~~costs ~~in a higher proportion~~ of ~~sales with higher average sales adjustment rates~~$12.0 million.

~~Cost~~Gross ofmargin ~~sales~~increased ~~decreased by $43.8 million, or 11%,~~ to ~~$355~~47.6 ~~million~~% in the ~~third~~first quarter of ~~2024~~2025 from ~~$399~~44.~~4 million~~5% in the ~~third~~first quarter of ~~2023,~~2024. The increase in gross margin was primarily due to afavorable ~~decrease~~foreign incurrency ~~product~~exchange of 300 basis points, incremental realized savings from the OPG program of 120 basis points, and ~~other~~lower inventory management costs of ~~$42~~110 basis points, including lower inventory obsolescence and close-out sales, partially offset by cost inflation of 140 basis points and unfavorable mix and other factors of 80 basis points.~~2 million.~~

~~Gross~~International ~~margin~~segment ~~increased~~operating toincome 51was $23.7%3 million in the ~~third~~first quarter of ~~2024~~2025, ~~from~~as 48compared to $9.3% million in the ~~third~~first quarter of ~~2023.~~2024, ~~The~~primarily ~~increase~~due into higher gross ~~margin~~profit ~~included favorable foreign currency exchange~~ of ~~250~~$12.1 ~~basis~~million ~~points, supply chain~~ and ~~other~~lower ~~efficiencies~~advertising ~~of 220 basis points, incremental realized savings from the OPG program of 80 basis points,~~ and ~~cost~~promotion ~~deflation~~expenses of ~~30 basis points, partially offset by unfavorable mix of 240 basis points~~$5.1 million.

International segment operating income was $217.7 million in the third quarter of 2024, as compared to $202.5 million in the third quarter of 2023, due to higher gross profit of $7.6 million, lower advertising and promotion expenses of $4.3 million, and lower other selling and administrative expenses of $3.3 million.

Results of Operations—First Nine Months

Consolidated Results

The following table presents Mattel's consolidated results for the first nine months of 2024 and 2023:

	For the Nine Months Ended								Year/Year Change
	September 30, 2024				September 30, 2023
	Amount		% of NetSales		Amount		% of NetSales		%		Basis Pointsof Net Sales
	(In millions, except percentage and basis point information)
Net sales	$	3,733.1			$	3,820.5			-2	%
Cost of sales	1,834.5		49.1	%	2,027.0		53.1	%	-9	%	(400)
Gross profit	1,898.6		50.9	%	1,793.5		46.9	%	6	%	400
Advertising and promotion expenses	250.1		6.7	%	290.3		7.6	%	-14	%	(90)
Other selling and administrative expenses	1,112.5		29.8	%	1,081.6		28.3	%	3	%	150
Operating income	536.0		14.4	%	421.6		11.0	%	27	%	340
Interest expense	89.4		2.4	%	92.5		2.4	%	-3	%	—
Interest (income)	(39.5)		-1.1	%	(15.4)		-0.4	%	156	%	(70)
Other non-operating expense (income), net	8.8				(6.0)
Income before income taxes	477.3		12.8	%	350.5		9.2	%	36	%	360
Provision for income taxes	94.8				296.8
(Income) from equity method investments	(18.4)				(13.3)
Net income	$	401.0	10.7	%	$	67.0	1.8	%	498	%	890

Sales

Net sales in the first nine months of 2024 were $3.73 billion, a decrease of $87.4 million, or 2%, as compared to $3.82 billion in the first nine months of 2023. The decrease in net sales was due to a decrease in gross billings of $109.2 million, partially offset by a decrease in sales adjustments of $21.8 million.

	For the Nine Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30,2024		September 30,2023
	(In millions, except percentage information)
Gross Billings by Categories
Dolls	$	1,465.6	$	1,631.1	-10	%	—	%
Infant, Toddler, and Preschool	675.1		708.6		-5	%	—	%
Vehicles	1,247.4		1,165.9		7	%	—	%
Action Figures, Building Sets, Games, and Other	763.2		755.0		1	%	—	%
Gross Billings	$	4,151.4	$	4,260.6	-3	%	—	%
Supplemental Gross Billings Disclosure
Gross Billings by Top 3 Power Brands
Barbie	$	944.1	$	1,064.7	-11	%	—	%
Hot Wheels	1,093.7		1,014.9		8	%	-1	%
Fisher-Price (a)	494.7		480.6		3	%	—	%
Other	1,618.9		1,700.4		-5	%	—	%
Gross Billings	$	4,151.4	$	4,260.6	-3	%	—	%

(a) Beginning in the first quarter of 2024, the Fisher-Price power brand was revised to exclude Baby Gear and Imaginext products. Prior period amounts have been reclassified to conform to the current presentation.

Gross billings were $4.15 billion in the first nine months of 2024, a decrease of $109.2 million, or 3%, as compared to $4.26 billion in the first nine months of 2023. The decrease in gross billings was primarily due to lower billings of Dolls and Infant, Toddler, and Preschool products, partially offset by higher billings of Vehicles and Action Figures, Building Sets, Games, and Other products.

Dolls gross billings decreased 10%, of which 7% was due to lower billings of Barbie, which benefited from the Barbie movie in the prior year, and 2% was due to lower billings of Disney Princess and Disney Frozen products.

Infant, Toddler, and Preschool gross billings decreased 5%, of which 4% was due to lower billings of Baby Gear and Power Wheels products and 2% was due to lower billings of Preschool Entertainment products, partially offset by higher billings of Fisher-Price products of 2%.

Vehicles gross billings increased 7%, primarily due to higher billings of Hot Wheels products.

Action Figures, Building Sets, Games, and Other gross billings increased 1%, of which 7% was due to higher billings of Games products, partially offset by lower billings of Other products of 3% and lower billings of Building Sets products of 2%.

Sales adjustments generally represent arrangements with Mattel's customers to provide sales incentives, support customer promotions, and provide allowances for returns and defective merchandise. Such programs are based primarily on customer purchases, customer performance of specified promotional activities, and other specified factors such as sales to consumers. Additionally, sales adjustments may include foreign currency transaction gains and losses from the remeasurement of accounts receivable denominated in currencies that are different from the relevant entity's functional currency. Sales adjustments decreased to $418.3 million in the first nine months of 2024 from $440.1 million in the first nine months of 2023. Sales adjustments as a percentage of net sales were relatively consistent at 11.2% in the first nine months of 2024, as compared to 11.5% in the first nine months of 2023.

Cost of Sales

Cost of sales decreased by $192.5 million, or 9%, to $1.83 billion in the first nine months of 2024 from $2.03 billion in the first nine months of 2023. Within cost of sales, product and other costs decreased by $180.5 million, or 11%, to $1.44 billion in the first nine months of 2024 from $1.62 billion in the first nine months of 2023. Royalty expense decreased by $7.2 million, or 4%, to $167.7 million in the first nine months of 2024 from $175.0 million in the first nine months of 2023. Freight and logistics expenses decreased by $4.7 million, or 2%, to $225.5 million in the first nine months of 2024, as compared to $230.2 million in the first nine months of 2023.

Gross Margin

Gross margin increased to 50.9% in the first nine months of 2024 from 46.9% in the first nine months of 2023. The increase in gross margin was primarily due to supply chain and other efficiencies of 270 basis points, cost deflation of 100 basis points, incremental realized savings from the OPG program of 100 basis points, and favorable foreign currency exchange of 30 basis points, partially offset by unfavorable mix of 100 basis points.

Advertising and Promotion Expenses

Advertising and promotion expenses primarily consist of: (i) media costs, which include the media, planning, and buying fees for television, print, and online advertisements, (ii) non-media costs, which include commercial and website production, merchandising, and promotional costs, (iii) retail advertising costs, which include consumer direct catalogs; and (iv) generic advertising costs, which include trade show costs. Advertising and promotion expenses as a percentage of net sales decreased to 6.7% in the first nine months of 2024, as compared to 7.6% in the first nine months of 2023, primarily due to a shift in the expected timing of advertising and promotion programs to the fourth quarter of 2024.

Other Selling and Administrative Expenses

Other selling and administrative expenses were $1.11 billion, or 29.8% of net sales, in the first nine months of 2024, an increase of $30.9 million, as compared to $1.08 billion, or 28.3% of net sales, in the first nine months of 2023. The increase in other selling and administrative expenses was primarily due to employee compensation increases and higher incentive compensation of $44.5 million, partially offset by realized savings from cost savings programs of $23.5 million and lower severance and restructuring charges of $19.2 million.

Interest Expense

Interest expense was $89.4 million in the first nine months of 2024, relatively flat as compared to $92.5 million in the first nine months of 2023.

Interest Income

Interest income increased by $24.1 million to $39.5 million in the first nine months of 2024 from $15.4 million in the first nine months of 2023, primarily due to higher average invested cash balances in the first nine months of 2024.

Provision for Income Taxes

Mattel's provision for income taxes was $94.8 million for the first nine months of 2024, as compared to $296.8 million for the first nine months of 2023. The decrease in provision for income taxes was due to discrete income tax expense in the first nine months of 2023, partially offset by the impact of higher income before income taxes in the first nine months of 2024, net of discrete income tax benefits. During the first nine months of 2023, Mattel recognized a net discrete income tax expense of $201.0 million, which included the establishment of a valuation allowance of $212.4 million on certain foreign deferred tax assets during the third quarter of 2023 resulting from the intra-group transfer of certain IP rights, partially offset by other discrete income tax benefits of $11.4 million. During the first nine months of 2024, Mattel recognized a net discrete tax benefit of $16.3 million primarily related to reassessments of prior years' tax liabilities and a discrete tax benefit on tax elections filed to amortize certain intangible assets transferred as part of Mattel's intra-group IP rights transfer.

Evaluating the need for and the amount of a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence to determine whether it is more-likely-than-not that these assets will be realizable. Mattel routinely assesses the positive and negative evidence for this realizability, including the evaluation of sustained profitability and three years of cumulative pretax income for each tax jurisdiction. During the third quarter of 2024, there were no material changes to Mattel's valuation allowance.

The OECD reached an agreement among various countries to implement a minimum 15% tax rate on certain multinational enterprises, commonly referred to as Pillar Two. Many countries continue to announce changes in their tax laws and regulations based on the Pillar Two rules. Mattel is continuing to evaluate the impact of these proposed and enacted legislative changes as new guidance becomes available. Some of the legislative changes could impact Mattel's effective tax rate and tax liabilities. When and how these laws and regulations are adopted or enacted by various countries in which Mattel operates could increase tax complexity and uncertainty and may adversely affect Mattel's worldwide effective tax rate, income tax expense and cash flows. Mattel does not expect the provisions effective in 2024 to have a materially adverse impact on its results of operations, financial position, or cash flows.

Segment Results

North America Segment

Beginning in the first quarter of 2024, Mattel's American Girl business was integrated into its North America commercial organization and is reported within the North America operating segment. Prior to the first quarter of 2024, Mattel's American Girl business was a separate reportable operating segment. Prior period amounts have been reclassified to conform to the current period presentation.

	For the Nine Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30, 2024		September 30, 2023
	(In millions, except percentage information)
Net Sales	$	2,192.6	$	2,241.9	-2	%	—	%
Segment Operating Income	622.3		565.6		10	%

Net sales for the North America segment in the first nine months of 2024 were $2.19 billion, a decrease of $49.3 million, or 2%, as compared to $2.24 billion in the first nine months of 2023. The decrease in net sales was primarily due to a decrease in gross billings of $51.8 million.

	For the Nine Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30, 2024		September 30, 2023
	(In millions, except percentage information)
Gross Billings by Categories
Dolls	$	838.2	$	919.1	-9	%	—	%
Infant, Toddler, and Preschool	420.1		437.7		-4	%	—	%
Vehicles	605.5		579.1		5	%	—	%
Action Figures, Building Sets, Games, and Other	473.8		453.4		5	%	—	%
Gross Billings	$	2,337.6	$	2,389.3	-2	%	—	%
Supplemental Gross Billings Disclosure
Gross Billings by Top 3 Power Brands
Barbie	$	517.5	$	587.6	-12	%	—	%
Hot Wheels	521.1		492.3		6	%	—	%
Fisher-Price (a)	300.6		285.9		5	%	—	%
Other	998.4		1,023.5		-2	%	—	%
Gross Billings	$	2,337.6	$	2,389.3	-2	%	—	%

Gross billings for the North America segment were $2.34 billion in the first nine months of 2024, a decrease of $51.8 million, or 2%, as compared to $2.39 billion in the first nine months of 2023. The decrease in gross billings was primarily due to lower billings of Dolls and Infant, Toddler, and Preschool products, partially offset by higher billings of Vehicles and Action Figures, Building Sets, Games, and Other products.

Dolls gross billings decreased 9%, of which 8% was due to lower billings of Barbie, which benefited from the Barbie movie in the prior year, and 2% was due to lower billings of Disney Princess and Disney Frozen products.

Infant, Toddler, and Preschool gross billings decreased 4%, of which 5% was due to lower billings of Baby Gear and Power Wheels products and 2% was due to lower billings of Preschool Entertainment products, partially offset by higher billings of Fisher-Price products of 3%.

Vehicles gross billings increased 5%, primarily due to higher billings of Hot Wheels products.

Action Figures, Building Sets, Games, and Other gross billings increased 5%, of which 6% was due to higher billings of Games products and 3% was due to higher billings of Action Figures products, partially offset by lower billings of Building Sets products of 2% and lower billings of Other products of 2%.

Sales adjustments decreased to $145.0 million in the first nine months of 2024 from $147.4 million in the first nine months of 2023, primarily due to lower gross billings. Sales adjustments as a percentage of net sales were flat at 6.6% for the first nine months of each of 2024 and 2023.

Cost of sales decreased by $103.3 million, or 8%, to $1.11 billion in the first nine months of 2024 from $1.22 billion in the first nine months of 2023, primarily due to a decrease in product and other costs of $96.1 million.

Gross margin in the first nine months of 2024 increased to 49.3% from 45.8% in the first nine months of 2023, primarily due to supply chain and other efficiencies of 240 basis points, cost deflation of 120 basis points, and incremental realized savings from the OPG program of 90 basis points, partially offset by unfavorable mix of 100 basis points.

North America segment operating income increased by $56.8 million to $622.3 million in the first nine months of 2024, as compared to $565.6 million in the first nine months of 2023, due to higher gross profit of $53.9 million and lower advertising and promotion expenses of $23.3 million, partially offset by higher other selling and administrative expenses of $20.4 million.

International Segment

The following tables provide a summary of Mattel's net sales, segment operating income, and gross billings by categories, along with supplemental information by brand, for the International segment for the first nine months of 2024 and 2023:

	For the Nine Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30,2024		September 30,2023
	(In millions, except percentage information)
Net Sales	$	1,540.6	$	1,578.6	-2	%	-1	%
Segment Operating Income	304.3		245.8		24	%

Net sales for the International segment in the first nine months of 2024 were $1.54 billion, a decrease of $38.0 million, or 2%, as compared to $1.58 billion in the first nine months 2023. The decrease in net sales was due to a decrease in gross billings of $57.5 million, partially offset by a decrease in sales adjustments of $19.4 million.

	For the Nine Months Ended				% Change asReported		CurrencyExchange RateImpact
	September 30,2024		September 30,2023
	(In millions, except percentage information)
Gross Billings by Categories
Dolls	$	627.5	$	712.0	-12	%	-1	%
Infant, Toddler, and Preschool	255.0		270.9		-6	%	-1	%
Vehicles	641.9		586.8		9	%	-1	%
Action Figures, Building Sets, Games, and Other	289.4		301.7		-4	%	-1	%
Gross Billings	$	1,813.8	$	1,871.3	-3	%	-1	%
Supplemental Gross Billings Disclosure
Gross Billings by Top 3 Power Brands
Barbie	$	426.6	$	477.1	-11	%	-1	%
Hot Wheels	572.6		522.6		10	%	-1	%
Fisher-Price (a)	194.1		194.7		—	%	-1	%
Other	620.5		676.9		-8	%	-1	%
Gross Billings	$	1,813.8	$	1,871.3	-3	%	-1	%

Gross billings for the International segment were $1.81 billion in the first nine months of 2024, a decrease of $57.5 million, or 3%, as compared to $1.87 billion in the first nine months of 2023, with an unfavorable impact from changes in currency exchange rates of one percentage point. The decrease in gross billings was due to lower billings of Dolls, Infant, Toddler, and Preschool, and Action Figures, Building Sets, Games, and Other products, partially offset by higher billings of Vehicles products.

Dolls gross billings decreased 12%, of which 7% was due to lower billings of Barbie, which benefited from the Barbie movie in the prior year, and 3% was due to lower billings of Disney Princess and Disney Frozen products.

Infant, Toddler, and Preschool gross billings decreased 6%, of which 3% was due to lower billings of Baby Gear and Power Wheels products and 3% was due to lower billings of Preschool Entertainment products.

Vehicles gross billings increased 9%, primarily due to higher billings of Hot Wheels products.

Action Figures, Building Sets, Games, and Other gross billings decreased 4%, of which 6% was due to lower billings of Action Figures products, 3% was due to lower billings of Other products, and 2% was due to lower billings of Building Sets products, partially offset by higher billings of Games products of 7%.

Sales adjustments decreased to $273.2 million in the first nine months of 2024 from $292.7 million in the first nine months of 2023. Sales adjustments as a percentage of net sales decreased to 17.7% for the first nine months of 2024, as compared to 18.5% for the first nine months of 2023. The decrease in sales adjustments as a percentage of net sales was primarily due to $15.9 million of net foreign currency transaction losses from the remeasurement of certain accounts receivable denominated in foreign currencies in the first nine months of 2023.

Cost of sales decreased by $78.6 million, or 9%, to $787.5 million in the first nine months of 2024 from $866.1 million in the first nine months of 2023, primarily due to a decrease in product and other costs of $74.3 million.

Gross margin increased to 48.9% in the first nine months of 2024 from 45.1% in the first nine months of 2023, primarily due to supply chain and other efficiencies of 300 basis points, incremental realized savings from the OPG program of 110 basis points, and cost deflation of 70 basis points, partially offset by unfavorable mix of 100 basis points.

International segment operating income increased by $58.5 million to $304.3 million in the first nine months of 2024, as compared to $245.8 million in the first nine months of 2023, primarily due to higher gross profit of $40.6 million and lower advertising and promotion expenses of $16.9 million.

Cost Savings Program

Optimizing for Profitable Growth

On February 7, 2024, Mattel announced the OPG program, a multi-year cost savings program that follows the Optimizing for Growth program (the "OFG program"), which concluded in the fourth quarter of 2023. The OPG program is designed to achieve further efficiency and cost savings opportunities, primarily within Mattel’s global supply chain, including its manufacturing footprint. The OPG program includes cost savings actions in connection with discontinuing production at a plant in China, as previously announced in the third quarter of 2023, as well as savings from other previous actions taken in 2023 that were not recognized in the OFG program. Targeted annual gross cost savings from actions associated with the OPG program, which are expected to be completed by 2026, are $200 million. Of the $200 million in targeted annual gross costs savings, approximately 7060% is expected to benefit cost of sales and 3040% is expected to benefit other selling and administrative expenses. Total ~~expected~~ cash expenditures under the OPG program are expected to be between $~~130~~115 and $~~165~~ 140 million and total non-cash charges are expected to be up to $5 million.

The costs associated with the OPG program are expected to include the following:

Optimizing for Profitable Growth – Actions			Estimate of Cost
Employee severance			$90105 to $~~105~~120 million
Other restructuring costs			$105 to $2010 million
Non-cash charges			up to $5 million
Total estimated severance and other restructuring costs (a)			$100 to $130 million
Total estimated severance and other restructuring costs			$110 to $135 million
Investments			$305 to $4010 million
Total estimated actions			$~~130~~115 to $~~170~~145 million


	For the Three Months Ended
	March 31, 2025		March 31, 2024
	(In millions)
Cost of sales (a)	$	1.6	$	2.2
Other selling and administrative expenses (b)	17.8		7.5
	$	19.4	$	9.7

	For the Three Months Ended				For the Nine Months Ended
	September 30,2024		September 30,2023		September 30,2024		September 30,2023
	(In millions)
Cost of sales (a)	$	0.4	$	—	$	3.0	$	—
Other selling and administrative expenses (b)	26.8		25.3		44.7		25.3
	$	27.2	$	25.3	$	47.7	$	25.3

(a)Severance and other restructuring costs recorded within cost of sales in the consolidated statements of operations are included in segment operating income in "Note 21 to the Consolidated Financial Statements—Segment Information."

(b)Severance and other restructuring costs recorded within other selling and administrative expenses in the consolidated statements of operations are included in corporate and other expense in "Note 21 to the Consolidated Financial Statements—Segment Information."

41As of March 31, 2025, Mattel has recorded cumulative severance and other restructuring charges related to the OPG program of approximately $94 million, which includes approximately $2 million of non-cash charges. Mattel realized cumulative cost savings (before severance, restructuring costs, and cost inflation) of approximately $103 million, which represents approximately 60% benefit to cost of sales, and 40% benefit to other selling and administrative expenses, as of March 31, 2025, in connection with the OPG Program.

As of September 30, 2024, Mattel has recorded cumulative severance and other restructuring charges related to the OPG program of approximately $73 million, which includes approximately $1 million of non-cash charges. Mattel realized cumulative cost savings (before severance, restructuring costs, and cost inflation) of approximately $60 million, which represents approximately 60% benefit to cost of sales, and 40% benefit to other selling and administrative expenses, as of September 30, 2024, in connection with the OPG Program.

Other Cost Savings Actions

As of December 31, 2023, Mattel concluded the OFG program, a multi-year cost savings program that had integrated and expanded upon the previous Capital Light program. The OFG program, excluding previous actions taken under the Capital Light program, realized gross annual cost savings of approximately $343 million upon conclusion of the program. In connection with the OFG program, Mattel recorded severance and other restructuring charges of $3.1 million and $31.6 million within other selling and administrative expenses during the three and nine months ended September 30, 2023, respectively, and a credit to severance and other restructuring charges of ($0.1) million and ($1.3) million within cost of sales during the three and nine months ended September 30, 2023, respectively, in the consolidated statement of operations.

Liquidity and Capital Resources

Mattel's primary sources of liquidity are its domestic and foreign cash and equivalents balances, short-term borrowing facilities, including its $1.40 billion ~~New Revolving~~ Credit Facility, ~~which on July 15, 2024 replaced the $1.40 billion Prior Revolving Credit Facility,~~ and access to capital markets to fund its operations and obligations. Such obligations may include capital expenditures, debt service, future royalty payments pursuant to licensing agreements, future inventory and service purchases, and required cash contributions and payments related to benefit plans. Of Mattel's $~~723~~1.524 ~~million~~billion in cash and equivalents at ~~September~~March 3031, ~~2024~~2025, $~~499~~931.42 million was held by foreign subsidiaries, including $5968.16 million held in Russia. Mattel's cash held in Russia can be used within the country; however, its movement out of Russia is currently limited. In early 2022, Mattel paused all shipments into Russia.

Cash flows from operating activities could be negatively impacted by decreased demand for Mattel's products, which could result from factors such as, but not limited to, adverse economic conditions and changes in public and consumer preferences, or by increased costs associated with manufacturing and distribution of products, such as tariffs, or shortages in raw materials or component parts. Additionally, Mattel's ability to issue long-term debt and obtain seasonal financing could be adversely affected by factors such as, but not limited to, global economic crises and tight credit environments, an inability to comply with its debt covenants and its ~~New Revolving~~ Credit Facility covenants, or deterioration of Mattel's credit ratings. However, based on Mattel's current business plan and factors known to date, it is expected that existing cash and equivalents, cash flows from operations, availability under the ~~New Revolving~~ Credit Facility, and access to capital markets will be sufficient to meet working capital, ~~and~~ operating expenditure, and other contractual requirements for the next twelve months and in the long-term.

Current Market Conditions

Mattel is exposed to financial market risk resulting from changes in interest and foreign currency exchange rates.

Mattel intends to utilize its existing cash and cash equivalents, cash flow from operations, and borrowings under the ~~New Revolving~~ Credit Facility to meet its short-term liquidity needs. At ~~September~~March 3031, ~~2024~~2025, Mattel had no outstanding borrowings under the ~~New Revolving~~ Credit Facility and approximately $9 million in outstanding letters of credit under the ~~New Revolving~~ Credit Facility.

Market conditions could affect certain terms of other debt instruments that Mattel enters into from time to time.

Mattel monitors the third-party depository institutions that hold Mattel's cash and equivalents. Mattel's emphasis is primarily on safety and liquidity of principal, and secondarily on maximizing the yield on those funds. Mattel diversifies its cash and equivalents among counterparties and securities to minimize risks.

Mattel is subject to credit risks relating to the ability of its counterparties in hedging transactions to meet their contractual payment obligations. The risks related to creditworthiness and nonperformance have been considered in the fair value measurements of Mattel's foreign currency forward exchange contracts. Mattel closely monitors its counterparties and takes action, as necessary, to manage its counterparty credit risk.

Mattel expects that some of its customers and vendors may experience difficulty in obtaining the liquidity required to buy inventory or raw materials. Mattel monitors its customers' financial condition and their liquidity in order to mitigate accounts receivable collectability risks, and customer terms and credit limits are adjusted, if necessary. Additionally, Mattel uses a variety of financial arrangements to support the collectability of accounts receivable of customers deemed to be a credit risk, including requiring letters of credit, purchasing various forms of credit insurance with unrelated third parties, or requiring cash in advance of shipment.

Mattel sponsors defined benefit pension plans and postretirement benefit plans for its employees. Actual returns below the expected rate of return, along with changes in interest rates that affect the measurement of the liability, would impact the amount and timing of Mattel's future contributions to these plans.

Cash Flow Activities

Cash flows ~~used~~provided ~~for~~by operating activities were $6124.68 million in the first ~~nine~~three months of ~~2024~~2025, as compared to $7935.65 million in the first ~~nine~~three months of ~~2023~~2024. The ~~change~~decrease in cash flows provided by operating activities was primarily due to ana ~~increase~~decrease in net income, excluding the impact of non-cash items, partially offset by ana ~~increase~~decrease in cash used for working capital of $~~113~~14.2 million. The decrease in cash used for working capital is primarily due to $45.5 million of favorable changes in accounts payable and accrued liabilities and $25.1 million of favorable changes in prepaid assets and other current assets, partially offset by $26.2 million of unfavorable changes in inventory and $20.0 million of unfavorable changes in accounts receivable, net.

Cash flows used for investing activities were $~~151~~31.73 million in the first ~~nine~~three months of ~~2024~~2025, as compared to $9328.94 million in the first ~~nine~~three months of ~~2023~~2024. The ~~change~~increase ~~was~~in ~~primarily~~cash ~~due~~flows toused ~~higher~~for ~~capital~~investing ~~expenditures~~activities ofwas ~~$39.4~~primarily ~~million,~~ due to ~~the~~higher ~~purchase~~capital ofexpenditures ~~an office building for approximately $59 million in July 2024, and lower proceeds from foreign currency forward exchange contracts~~ of $185.47 million in the first ~~nine~~three months of ~~2024~~2025.

Cash flows used for financing activities were $~~314~~161.29 million in the first ~~nine~~three months of ~~2024~~2025, as compared to $~~119~~131.53 million in the first ~~nine~~three months of ~~2023~~2024. The ~~change~~increase in cash flows used for financing activities was primarily due to $~~158~~60.40 million of higher share repurchases in the first ~~nine~~three months of ~~2024~~2025 as compared to the first ~~nine~~three months of ~~2023~~2024.

Seasonal Financing

See Part I, Item 1 "Financial Statements—Note 8 to the Consolidated Financial Statements—Seasonal Financing" of this Quarterly Report on Form 10-Q.

Financial Position

Mattel's cash and equivalents decreased $~~537~~144.82 million to $~~723~~1.524 ~~million~~billion at ~~September~~March 3031, ~~2024~~2025 from $1.2639 billion at December 31, ~~2023~~2024, primarily due to share repurchases of $~~268~~160.30 million, and capital expenditures of $~~156~~36.92 million, ~~and~~partially offset by cash flows ~~used~~provided ~~for~~by operating activities of $6124.68 million during the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025. Mattel's cash and equivalents increased $~~267~~113.85 million to $~~723~~1.524 ~~million~~billion at ~~September~~March 3031, ~~2024~~2025 from $~~455~~1.713 ~~million~~billion at ~~September~~March 3031, ~~2023~~2024, primarily due to cash flows ~~generated~~provided ~~from~~by operating activities of $~~887~~789.89 million during the trailing twelve months, partially offset by $~~361~~460.50 million of share repurchases and $~~199~~208.73 million of capital expenditures during the trailing twelve months.

Accounts receivable ~~increased~~decreased $~~395~~369.59 million to $1633.483 ~~billion~~million at ~~September~~March 3031, ~~2024~~2025 from $1.0800 billion at December 31, ~~2023~~2024, primarily due to ~~the~~seasonal ~~seasonality~~declines ofas ~~Mattel's~~year-end ~~business~~receivables are collected. Accounts receivable decreased by $9340.70 million to $1633.483 ~~billion~~million at ~~September~~March 3031, ~~2024~~2025 from $1673.573 ~~billion~~million at ~~September~~March 3031, ~~2023~~2024, primarily due to ~~lower~~timing ~~sales in the third quarter~~ of ~~2024~~sales asand ~~compared to the third quarter of 2023~~collections.

Inventories increased $~~165~~156.67 million to $~~737~~658.24 million at ~~September~~March 3031, ~~2024~~2025 from $~~571~~501.67 million at December 31, ~~2023~~2024, primarily due to seasonal inventory build. Inventories decreased $5310.39 million to $~~737~~658.24 million at ~~September~~March 3031, ~~2024~~2025 from $~~790~~669.53 million at ~~September~~March 3031, ~~2023~~2024, primarily due to continued inventory management efforts.

Prepaid expenses and other current assets increased $3417.80 million to $~~242~~251.31 million at ~~September~~March 3031, ~~2024~~2025 from $~~207~~234.51 million at December 31, ~~2023~~2024, ~~which~~primarily ~~included~~due to increases in prepaid ~~royalties~~insurance of $1312.2 5 million, ~~other~~and ~~current~~prepaid ~~assets~~income taxes of $1310.08 million, ~~and~~partially ~~prepaid~~offset ~~value~~by ~~added~~a ~~taxes~~decrease in derivative receivables of $11.2 million. Prepaid expenses and other current assets ~~increased~~decreased $1711.56 million to $~~242~~251.31 million at ~~September~~March 3031, ~~2024~~2025 from $~~224~~262.87 million at ~~September~~March 3031, ~~2023~~2024, ~~which~~primarily ~~included~~due ~~increases~~to decreases in prepaid ~~royalties~~income taxes of $1422.23 million ~~and other current assets of $13~~.~~4 million, partially offset by a decrease in derivative receivables of $10.4 million.~~

Accounts payable and accrued liabilities decreased $66146.20 million to $1.2413 billion at ~~September~~March 3031, ~~2024~~2025 from $1.3128 billion at December 31, ~~2023~~2024, due to seasonal declines in expenditure levels. ~~and~~Accounts ~~the~~payable ~~timing~~and ofaccrued ~~incentive~~liabilities ~~compensation~~increased ~~payments~~$47.6 ~~Accounts~~million ~~payable~~to ~~and~~$1.13 ~~accrued~~billion ~~liabilities~~at ~~were~~March 31, 2025 from $1.24 08 billion at ~~September~~March 3031, 2024, ~~relatively~~primarily ~~flat~~due asto ~~compared~~increases toin accrued compensation of $124.~~25 billion~~2 atmillion ~~September 30,~~and ~~2023~~accrued royalties of $20.2 million.

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A summary of Mattel's capitalization is as follows:

	September 30, 2024				September 30, 2023				December 31, 2023
	March 31, 2025				March 31, 2024				December 31, 2024
	(In millions, except percentage information)
Cash and equivalents	$	~~723~~1,243.57			$	~~455~~1,130.72			$	1,~~261~~387.49
2010 Senior Notes due October 2040	250.0				250.0				250.0
2011 Senior Notes due November 2041	300.0				300.0				300.0
2019 Senior Notes due December 2027	600.0				600.0				600.0
2021 Senior Notes due April 2026	600.0				600.0				600.0
2021 Senior Notes due April 2029	600.0				600.0				600.0
Debt issuance costs and debt discount	(1614.76)				(2118.19)				(2015.06)
Total debt	2,~~333~~335.34		5052	%	2,~~328~~331.91		5354	%	2,~~330~~334.04		5251	%
Stockholders' equity	2,~~312~~129.96		5048		2,~~035~~025.53		4746		2,~~149~~264.21		4849
Total capitalization (debt plus equity)	$	4,646.2	100	%	$	4,364.4	100	%	$	4,479.2	100	%
Total capitalization (total debt plus stockholders' equity)	$	4,465.0	100	%	$	4,356.4	100	%	$	4,598.5	100	%

Total debt was $2.3334 billion at ~~each of September~~March 3031, ~~2024~~2025, and $2.33 billion at December 31, ~~2023~~2024 and ~~September~~March 3031, ~~2023~~2024, respectively.

Stockholders' equity ~~increased~~decreased $~~163~~134.75 million to $2.3113 billion at ~~September~~March 3031, ~~2024~~2025 from $2.1526 billion at December 31, ~~2023~~2024, primarily due to ~~net~~share ~~income~~repurchases of $~~401~~160.0 million and ~~the~~ net ~~effect~~loss of ~~share-based~~$40.3 ~~compensation~~million, ~~and~~partially ~~the~~offset ~~related~~by ~~issuance~~other ofcomprehensive ~~treasury~~income ~~stock~~ of $4447.19 million, ~~partially~~and ~~offset~~the byimpact of share-based ~~repurchases~~compensation on additional paid-in capital of $~~268~~19.3 9 million during the first ~~nine~~three months of ~~2024~~2025. Stockholders' equity increased $~~277~~104.53 million to $2.3113 billion at ~~September~~March 3031, ~~2024~~2025 from $2.0403 billion at ~~September~~March 3031, ~~2023~~2024, primarily due to net income of $~~548~~529.38 million and the ~~net~~impact ~~effect~~ of share-based compensation ~~and~~on ~~the~~additional ~~related~~paid-in ~~issuance~~capital of ~~treasury stock of~~ $7481.54 million during the trailing twelve months, partially offset by share repurchases of $~~361~~464.52 million and other comprehensive loss of $30.9 million during the trailing twelve months.

Litigation

See Part I, Item 1 "Financial Statements—Note 20 to the Consolidated Financial Statements—Contingencies" of this Quarterly Report on Form 10-Q.

Application of Critical Accounting Policies and Estimates

Mattel's critical accounting policies and estimates are included in the ~~2023~~2024 Annual Report on Form 10-K and did not materially change during the first ~~nine~~three months of ~~2024~~2025.

New Accounting Pronouncements

See Part I, Item 1 "Financial Statements—Note 22 to the Consolidated Financial Statements—New Accounting Pronouncements" of this Quarterly Report on Form 10-Q.

Non-GAAP Financial Measure

To supplement the financial results presented in accordance with GAAP, Mattel presents a non-GAAP financial measure within the meaning of Regulation G promulgated by the SEC. The non-GAAP financial measure that Mattel presents is currency exchange rate impact. Mattel uses this measure to analyze its continuing operations and to monitor, assess, and identify meaningful trends in its operating and financial performance. Mattel believes that the disclosure of this non-GAAP financial measure provides useful supplemental information to investors to be able to better evaluate ongoing business performance and certain components of Mattel's results. This measure is not, and should not be viewed as, a substitute for GAAP financial measures and may not be comparable to similarly-titled measures used by other companies.

Currency Exchange Rate Impact

The currency exchange rate impact reflects the portion (expressed as a percentage) of changes in Mattel's reported results that are attributable to fluctuations in currency exchange rates.

4437

For entities reporting in currencies other than the U.S. dollar, Mattel calculates the percentage change of period-over-period results at constant currency exchange rates (established as described below) by translating current period and prior period results using these rates and then determines the currency exchange rate impact percentage by calculating the difference between the percentage change at such constant currency exchange rates and the percentage change at actual exchange rates.

The constant currency exchange rates are determined by Mattel at the beginning of each year and are applied consistently during the year. They are generally different from the actual exchange rates in effect during the current or prior period due to volatility in actual currency exchange rates. Mattel considers whether any changes to the constant currency rates are appropriate at the beginning of each year. The exchange rates used for these constant currency calculations are generally based on prior year actual exchange rates.

Mattel believes that the disclosure of the percentage impact of currency changes is useful supplemental information for investors to be able to gauge Mattel's current business performance and the longer-term strength of its overall business since currency changes could potentially mask underlying sales trends. The disclosure of the percentage impact of currency exchange allows investors to calculate the impact on a constant currency basis and also enhances their ability to compare financial results from one period to another.

Key Performance Indicator

Gross billings represent amounts invoiced to customers. It does not include the impact of sales adjustments, such as trade discounts and other allowances. Mattel presents changes in gross billings as a metric for comparing its aggregate, categorical, brand, and geographic results to highlight significant trends in Mattel's business. Changes in gross billings are discussed because, while Mattel records the details of sales adjustments in its financial accounting systems at the time of sale, such sales adjustments are generally recorded by customer and not associated with categories, brands, or individual products.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Foreign Currency Exchange Rate Risk

Currency exchange rate fluctuations may impact Mattel's results of operations and cash flows. The Euro, ~~Chinese yuan,~~ and ~~Mexican~~British ~~peso~~pound sterling were the primary currencies that caused foreign currency transaction exposure for Mattel during the first ~~nine~~three months of ~~2024~~2025. Mattel seeks to mitigate its foreign currency exchange risk by monitoring its foreign currency transaction exposure for the year and partially hedging such exposure using foreign currency forward exchange contracts primarily to hedge its purchase and sale of inventory and other intercompany transactions denominated in foreign currencies. These contracts generally have maturity dates of up to 24 months. For those intercompany receivables and payables that are not hedged, the transaction gains or losses are recorded in the consolidated statements of operations in the period in which the exchange rate changes as part of operating ~~income~~loss or other non-operating ~~(income)~~ expense, net based on the nature of the underlying transaction. Transaction gains or losses on hedged intercompany inventory transactions are recorded in the consolidated statements of operations in the period in which the inventory is sold to customers. In addition, Mattel manages its exposure to currency exchange rate fluctuations through the selection of currencies used for international borrowings. Mattel does not trade in financial instruments for speculative purposes.

Mattel's financial position is also impacted by currency exchange rate fluctuations on translation of its net investments in subsidiaries with non-U.S. dollar functional currencies. Assets and liabilities of subsidiaries with non-U.S. dollar functional currencies are translated into U.S. dollars at fiscal period-end exchange rates. Income, expense, and cash flow items are translated at weighted-average exchange rates prevailing during the fiscal period. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive loss within stockholders' equity. Mattel's primary currency translation adjustments for the ~~nine~~three months ended ~~September~~March 3031, ~~2024~~2025 were related to its net investments in entities having functional currencies denominated in the ~~Mexican~~Russian ~~peso,~~ruble and British pound sterling ~~and Brazilian real~~.

There are numerous factors impacting the amount by which Mattel's financial results are affected by foreign currency translation and transaction gains and losses resulting from changes in currency exchange rates, including, but not limited to, the level of foreign currency forward exchange contracts in place at a given time and the volume of foreign currency-denominated transactions in a given period. However, assuming that such factors were held constant, Mattel estimates that a one percent change in the U.S. dollar would have impacted Mattel's ~~third~~first quarter 2025 net sales by approximately 0.32% and would have less than a $0.01 impact to Mattel's net income per share.

4538

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

As of ~~September~~March 3031, ~~2024~~2025, Mattel's disclosure controls and procedures were evaluated, with the participation of Mattel's principal executive officer and principal financial officer, to assess whether they are effective in providing reasonable assurance that information required to be disclosed by Mattel in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. Based on this evaluation, Ynon Kreiz, Mattel's principal executive officer, and Anthony DiSilvestro, Mattel's principal financial officer, concluded that these disclosure controls and procedures are not effective as of ~~September~~March 3031, ~~2024~~2025 due to a material weakness in Mattel's internal control over financial reporting, which is more fully described in Management's Report on Internal Control Over Financial Reporting, in Part II, Item 8 "Financial Statements and Supplementary Data" in the ~~2023~~2024 Annual Report on Form 10-K.

Remediation Plan

Management is in the process of ~~implementing~~executing its remediation plan to address the material weakness,. ~~which~~During ~~includes~~ the ~~adoption~~quarter ofended ~~new~~March ~~program~~31, ~~change~~2025, management ~~controls,~~completed ~~and~~ the design and implementation of new user access provisioning and review controls. ~~During~~for ~~the~~certain ~~quarter ended September 30, 2024, management implemented newly designed program change management controls~~systems. Additional time is required to test the operating effectiveness of these ~~controls~~ and topreviously ~~complete~~implemented ~~the design, implementation, and testing of the user access provisioning and review~~ controls to demonstrate the effectiveness of the remediation efforts. The material weakness cannot be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in Internal Control Over Financial Reporting

Except as described above, there were no changes in internal control over financial reporting that occurred during the quarter ended ~~September~~March 3031, ~~2024~~2025 that have materially affected, or are reasonably likely to materially affect, Mattel's internal control over financial reporting.

4639

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

The content of Part I, Item 1 "Financial Statements—Note 20 to the Consolidated Financial Statements—Contingencies" of this Quarterly Report on Form 10-Q is hereby incorporated by reference in its entirety in this Item 1.

Item 1A. Risk Factors.

~~There~~Other than as provided below, there have been no material changes to the risk factors disclosed under Part I, Item 1A "Risk Factors" in the ~~2023~~2024 Annual Report on Form 10-K.

Political developments, including trade relations, and/or trade actions could adversely impact Mattel, its personnel and facilities, its customers and suppliers, retail and financial markets, and general economic conditions.

Mattel's business is worldwide in scope, and political instability, civil unrest, the deterioration of the political, economic, or social situation in a country in which Mattel has significant sales or operations, or changes to trade policy or the breakdown of trade relations between the United States and a foreign country in which Mattel has significant manufacturing facilities, operations or significant sales, or from which Mattel sources raw materials or components or delivers finished products, could adversely affect Mattel's business, financial condition, and results of operations. A change in trade status between the United States and a foreign country could result in a substantial increase in the import duty of toys manufactured in that foreign country and imported into the United States. For example, the United States has announced significant new tariffs on imports from a wide range of countries, including China, which was followed by retaliatory tariffs by China and a number of countries and a cycle of further retaliatory tariff announcements and trade actions. Certain of the tariffs have been and may be delayed, but others have taken or may take effect. Further, tariffs announced or imposed by the United States could be altered or delayed through actions taken by the administration, bilateral negotiations, judicial orders or congressional action, and tariffs announced or imposed by other countries can be affected by similar developments. These and future changes in tariffs and trade policies by the United States or China, or trade actions by or directed toward other countries, such as Mexico, Vietnam, or Canada, or retaliatory trade measures in response, have resulted and may continue to result in additional costs and pricing pressures, supply chain disruptions, volatile or unpredictable customer spending patterns, and increased economic or geopolitical risks, any or all of which could adversely impact Mattel's future sales, business, financial condition, and results of operations, perhaps materially or in ways that we cannot predict. For example, diverting more production to, or sourcing from, countries other than China or Mexico, could raise the cost of Mattel products in those markets, and could cause customers in those markets to seek domestic or non-U.S. sources for products that Mattel sells, or to be pressured or incentivized by foreign governments not to purchase goods of U.S. companies, which could adversely impact Mattel's future sales.

In addition, the United States, United Kingdom, and European Union, among other jurisdictions, have each imposed export controls, as well as financial and economic sanctions, currency controls, and other trade actions, on certain products, technologies, industry sectors, and parties in Russia and Belarus as a result of the Russia-Ukraine war, which have resulted and could further result in retaliatory measures and actions by Russia. Any increased trade barriers or restrictions on global trade imposed by the United States, whether toward China, Russia, or other countries, or further retaliatory trade measures or currency controls taken by China, Russia, or other countries in response, could further adversely affect Mattel's business, financial condition, and results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Recent Sales of Unregistered Equity Securities

During the ~~third~~first quarter of ~~2024~~2025, Mattel did not sell any unregistered equity securities.

Issuer Purchases of Equity Securities

The following table provides certain information with respect to Mattel's purchases of its common stock during the ~~third~~first quarter of ~~2024~~2025:

Period	Total Number ofSharesPurchased (a)	Average Price Paidper Share		Total Number of SharesPurchased asPart of PubliclyAnnounced Plans orPrograms	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (b)(In millions)
July 1-31	5,677	$	19.28	—	$	800,014,073
January 1-31	7,515	$	17.98	—	$	600.0
August 1-31	3,733,131	19.10		3,574,595	731,693,173
February 1-28	7,521,174	21.54		7,408,050	440.0
September 1-30	53,845	19.04		—	731,693,173
March 1-31	3,415	19.33		—	440.0
Total	37,~~792~~532,~~653~~104	$	1921.1054	37,~~574~~408,~~595~~050	$	~~731,693,173~~440.0

____________________________________

(a)The total number of shares purchased includes ~~218~~124,~~058~~054 shares withheld from employees to satisfy minimum tax withholding obligations that occur upon settlement of equity awards, which were not purchased as part of a publicly announced repurchase plan or program.

(b)On February 5, 2024, the Board of Directors authorized a $1.00 billion share repurchase program. As of ~~September~~March 3031, ~~2024~~2025, Mattel had a remaining authorization of $~~731~~440.70 million under the program. Repurchases under the share repurchase program will take place from time to time, depending on market conditions. Mattel's share repurchase program has no expiration date.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

(a)None.

(b)Not applicable.

(c)None.

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Item 6. Exhibits.

Incorporated by Reference

Exhibit No.

Exhibit Description

Form

File No.

Exhibit(s)

Filing Date

3.0

Restated Certificate of Incorporation of Mattel, Inc.

8-K

001-05647

99.0

May 21, 2007

3.1

Amended and Restated Bylaws of Mattel, Inc.

8-K

001-05647

3.1

September 15, 2023

4.0

Specimen Stock Certificate with respect to Mattel, Inc.'s Common Stock

10-Q

001-05647

4.0

August 3, 2007

10.1

Revolving Credit Agreement, dated as of July 15, 2024, among Mattel, as the borrower, Bank of America, N.A., as administrative agent, and the other lenders and financial institutions party thereto

8-K

001-05647

10.1

July 16, 2024

10.1+*

Letter Agreement between Mattel, Inc. and Anthony DiSilvestro, dated January 16, 2025

10.2+

Form of Grant Agreement for Performance-Based Restricted Stock Units for Ynon Kreiz under the Mattel, Inc. Amended and Restated 2010 Equity and Long-Term Compensation Plan

8-K

001-05647

10.1

September 13, 2024

31.0*

Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.1*

Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.0**

Certifications of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS*

Inline XBRL Instance Document

101.SCH*

Inline XBRL Taxonomy Extension Schema Document

101.CAL*

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*

Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE*

Inline XBRL Taxonomy Extension Presentation Linkbase Document

104*

The cover page from this Quarterly Report on Form 10-Q, formatted in Inline XBRL.

______________________________________________


+			Management contract or compensatory plan or arrangement.
*			Filed herewith.
**			Furnished herewith. This exhibit should not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


			MATTEL, INC. Registrant

			By:						/s/ Yoon Hugh
									Yoon Hugh Senior Vice President and Corporate Controller (Duly Authorized Officer and Chief Accounting Officer)

Date: ~~October~~May 295, ~~2024~~2025

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