What changed in this filing

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Item 1. Business

2023-02-22 compared with 2022-02-28 · 85 added, 90 removed, 144 unchanged (55% of the section changed)

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Mattel's portfolio of owned and licensed brands and products are organized into the following categories:

Dolls —including brands such as Barbie, Monster High, American Girl, Polly Pocket, Spirit (Universal), and Enchantimals .

Dolls —including brands such as Barbie, American Girl, Disney Princess and 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.

With an extensive portfolio of dolls and accessories, content, gaming, and lifestyle products, American Girl is best known for imparting valuable life lessons through its inspiring dolls and books, featuring diverse characters from past and present.

Its products are sold directly to consumers via its catalog, website, and proprietary retail stores.

Infant, Toddler, and Preschool —including brands such as Fisher-Price and Thomas & Friends , Power Wheels , and Fireman Sam .

As a leader in play and child development, Fisher-Price ’s mission is to provide meaningful solutions for parents and enrich children’s lives from birth to school readiness, helping families get the best possible start.

Thomas & Friends is an award-winning preschool train brand franchise that brings meaningful life lessons of friendship and teamwork to kids through content, toys, live events, and other lifestyle categories.

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.

American Girl products are sold directly to consumers through its website, proprietary retail stores in the United States, at select retailers nationwide, and at specialty boutiques and franchise stores in Canada.

Infant, Toddler, and Preschool —including brands such as Fisher-Price and Thomas & Friends , and PowerWheel s.

As a leader in play and child development, Fisher-Price's mission is to help families by making the most fun, enriching products for infants, toddlers, and preschoolers.

Thomas & Friends is an award-winning preschool train brand franchise that brings meaningful life lessons of friendship and teamwork to kids through toys, content, live events, and other consumer products.

Vehicles —including brands such as Hot Wheels (including Hot Wheels Monster Trucks and Hot Wheels Mario Kart ( Nintendo )), Matchbox , and Cars ( Disney Pixar ).

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From die-cast vehicles to tracks, playsets, and accessories, the Mattel Vehicles portfolio has broad appeal that engages and excites kids of all ages.

Action Figures, Building Sets, Games, and Other —including brands such as Masters of the Universe , MEGA , UNO , Lightyear ( Disney Pixar ), Jurassic World ( NBCUniversal ), WWE, and Star Wars ( Disney ).

Mattel’s action figure portfolio is comprised of product lines associated with licensed entertainment franchises that are driven by major theatrical releases, such as Lightyear and Jurassic World, as well as product lines from Mattel’s owned IP, including Masters of the Universe.

Mattel's Action Figures portfolio is comprised of product lines associated with licensed entertainment franchises that are driven by major tentpole releases, such as Lightyear and Jurassic World , as well as product lines from Mattel's owned IP, such as Masters of the Universe .

As the challenger brand in Building Sets, MEGA sparks creativity through the power of connection with builders of all ages and fans of global franchises.

UNO is the classic matching card game that is easy to learn and fast fun for everyone.

Other includes Plush, which contains product offerings associated with theatrical releases from Mattel’s licensed entertainment 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.

Business Segments

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The North America segment markets and sells toys and consumer products in the United States and Canada across all of Mattel's categories.

Barbie will continue to deliver innovation, purpose-driven marketing campaigns, and engaging toys connected to a strong system of play.

Barbie has broad product offerings, with product lines designed to appeal to children from ages three to nine, complemented by a Barbie Signature line with high-quality dolls that appeal to fans of all ages.

In 2022, Barbie will be featured in four Netflix content releases, introduce exciting new launches in the Extra and Reveal product lines, and introduce high profile partnerships and pop culture collaborations, all while celebrating the 60th anniversary of the Dreamhouse and the launch of an all-new Dream Camper.

In 2022, Polly Pocket will refresh its product offering with new compact playset innovation, brand new themes, and the fourth season of its popular animated content series on streaming and broadcast platforms globally.

There are also two new product launches in Fall 2022;

a product line tied to Chris "Ludacris" Bridges' series "Karma's World" and the much-anticipated re-launch of the powerhouse franchise Monster High .

Barbie continues to deliver innovation, purpose-driven marketing campaigns, and engaging toys connected to a strong system of play.

Barbie has broad product offerings, with product lines designed to appeal to children of multiple age groups, complemented by a Barbie Signature line with high-quality dolls that appeal to fans of all ages.

In 2023, Barbie will be featured in a live action theatrical movie directed by Greta Gerwig and starring Margot Robbie and Ryan Gosling, which will include the launch of an all new Dreamhouse in support of the release.

Barbie will also launch exciting new lines, including My First Barbie , Styling Head , and Large Doll , and will introduce more high-profile partnerships and pop culture collaborations.

Mattel is also excited to build upon its strong partnerships with Disney with the return of the Disney Princess and Frozen product lines, and Universal with the launch of new Trolls product lines.

Monster High will look to build upon the success of its 2022 U.S.

re-launch with a full global re-launch in 2023, including new content and product offerings.

Infant, Toddler, and Preschool

In 2022, Fisher-Price will continue its focus on surprising and delighting consumers as a trusted partner for families with infants and preschoolers, by continuing to create brand love through innovative products and inviting adults back into the world of childhood.

Design-led innovation will continue to drive new product offerings, including Meditation Mouse , a calming toy for toddlers designed to teach self-soothing techniques, and expansion of the Linkamals product line to toddlers.

Mattel will also scale its portfolio of Little People products to include Barbie's Lil' Dreamhouse and Hot Wheel's Racing Loops .

New preschool toys from Imaginext will include product lines associated with highly-anticipated theatrical releases:

The Batman (Warner Brothers), Jurassic World:

Dominion (NBCUniversal), and Lightyear (Disney Pixar).

In 2022, industry leader Hot Wheels will look to continue its strong momentum as a multigenerational franchise with consumer interest levels at historic highs.

Hot Wheels product offerings will excite and delight with revitalized Hot Wheels City playsets for expanded fun across the system of play, new product lines for the Jurassic World:

Dominion ( NBCUniversal ) and Lightyear ( Disney Pixar ) theatrical releases, and digital ways to collect with the NFT Garage series.

In the second half of the year, Hot Wheels will enter new vehicle play patterns and categories, all while upholding the quality and performance of Hot Wheels .

Mattel will also continue to partner with Disney Pixar for CARS , driving excitement around the new content CARS on the Road by launching an all-new content-inspired product line in Fall 2022.

Finally, die-cast category pioneer Matchbox will continue year two of its re-launch with exciting new products and an evolution of the “Drive Your Adventure” brand campaign that will feature exciting new licenses, and new episodes of the popular series on YouTube Matchbox Adventures .

In 2023, Fisher-Price will continue its focus on engaging consumers as a trusted partner for families with infants, toddlers and preschoolers, by continuing to create brand love through innovative products and inviting adults back into the world of childhood.

Design-led innovation will continue to drive new product offerings, including the expansion of the Linkimals product line and new innovative toys from Imaginext .

Mattel will look to continue its strong momentum in the Little People product line with the expansion of the Little People Barbie line and Little People Collector , tapping into a new consumer base.

New preschool toys will include product lines associated with the episodic content launch of Batwheels , an ultimate world of racing and chasing series.

In 2023, industry leader Hot Wheels will look to continue its strong momentum as a multigenerational franchise with consumer interest that remains at historic highs.

Hot Wheels product offerings will continue to excite with innovation in Tracks and Playsets , expansion of the 2022 Hot Wheels Skate launch, introduction of product lines for The Super Mario Bros.

Movi e ( Universal ) animated theatrical movie, and more digital ways to collect with the NFT Garage series.

Hot Wheels will also continue to enter new vehicle play segments, while upholding the quality and performance of Hot Wheels .

Die-cast pioneer Matchbox will celebrate its 70 th anniversary, honoring its legacy with special edition die-cast offerings and packaging.

Matchbox will continue to bring exciting new products to market, including product partnerships with SpaceX, and new episodes of the globally popular YouTube series, Matchbox Adventures .

Mattel will continue to partner with Disney Pixar for Cars with fresh new product offerings, building on the excitement from the Fall 2022 release of Cars on the Road content, and supporting Disney's 100-year anniversary with Cars Disney 100 toys.

Action Figures, Building Sets, Games, and Other

Mattel Action Figures will continue to collaborate with key licensor partners, such as Disney , NBCUniversal , WWE , and Microsoft , to bring innovative products to the global marketplace.

Key 2022 product lines to be based on entertainment franchises include NBCUniversal’s Jurassic World:

Dominion, Minions:

Rise of Gru, and Disney Pixar’s Lightyear , each with a theatrical release scheduled for Summer 2022.

Mattel will complement its portfolio with the continued expansion of Masters of the Universe .

Masters of the Universe products will be bolstered by more Netflix animated content coming in 2022 and global brand support targeted to both new and existing fans.

Mattel Action Figures will continue to collaborate with key licensor partners, such as Disney Pixar , Microsoft , NBCUniversal , and WWE , to bring innovative products to the global marketplace.

A sample of Mattel's 2023 Action Figures product lines include toys tied to Microsoft's Spring release of the new Minecraft Legends game, and NBCUniversal's Jurassic World , which will be celebrating the 30 th anniversary of the Jurassic Park franchise.

Mattel will continue to expand its Masters of the Universe franchise with products for fans of all ages and continued expansion of the collector business.

In Building Sets, MEGA sparks creativity through the power of connection with builders of all ages and fans of global franchises.

Partnerships with some of the world’s top franchises including Pokémon , Barbie , Hot Wheels, and Paw Patrol, invite consumers to try MEGA building sets, while innovative building play, authentic details, compatible quality, and accessible value encourages consumers to stay in the MEGA building collection.

In 2022, parents of preschoolers can discover how the MEGA Bloks preschool building system enhances playtime and early childhood development beyond the Big Building Bag.

Mattel Games consists of some of the most beloved Games IP in the world including UNO, Pictionary , Skip-Bo, Bloku s, and many others.

In 2022, UNO will introduce a new card-based extension to its portfolio, UNO All Wild and lean deeper into collectible cards with UNO Ultimate Marvel .

Additionally, Mattel will introduce new game extensions and partnerships that celebrate pop culture.

Mattel will also continue to extend key brands and products, including a new licensed extension of the Pictionary line, Pictionary Air .

Mattel Plush will collaborate with partners Disney’s Lucasfilm, Pixar, and Marvel, Microsoft’s Minecraft, NBCUniversal’s Jurassic World , and many more.

In 2022, the Plush portfolio is expected to benefit from multiple tentpole moments capitalizing on this strong entertainment slate.

Partnerships with some of the world's top franchises including Pokémon , Barbie and Hot Wheels , invite consumers to try MEGA building sets, while innovative building play, authentic details, compatible quality, and accessible value encourages consumers to stay in the MEGA building set collection.

Parents of preschoolers can continue to discover how the MEGA Bloks preschool building system enhances playtime and early childhood development beyond the Big Building Bag.

Mattel Games consists of some of the most beloved Games IP in the world including UNO , Pictionary , Skip-Bo , Blokus , and many others.

Mattel will focus on its expansion of Games into its direct-to-consumer business, collectability, and innovation.

Additionally, Mattel will continue to introduce new game extensions and partnerships that celebrate pop culture.

Mattel Plush will continue to collaborate with key licensor partners, including Disney's Lucasfilm , Pixar , Marvel , Microsoft's Minecraft , NBCUniversal's Jurassic World , and many more.

The Plush portfolio is expected to benefit from tentpole moments capitalizing on this strong entertainment slate in 2023.

Mattel will also bring its iconic IP into the Plush category.

International Segment

Products marketed and sold by the International segment are generally the same as those marketed and sold by the North America segment, although some are developed or adapted for particular international markets.

Mattel’s products are sold directly to retailers and wholesalers in most European, Latin American, and Asian countries, and in Australia and New Zealand, and through agents and distributors in those countries where Mattel has no direct presence.

Mattel's products are sold directly to retailers and wholesalers in most European, Latin American, and Asian countries, in Australia and New Zealand, in certain countries in the Middle East and Africa, and through agents and distributors in those countries where Mattel has no direct presence.

No individual country within the International segment exceeded 7% of worldwide consolidated net sales during 2022.

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American Girl also publishes best-selling fiction and non-fiction books, as well as an array of popular digital content.

The American Girl segment sells products directly to consumers via its catalog, website, in its proprietary retail stores in the United States, at select retailers nationwide, and at specialty boutiques and franchise stores in Canada.

In January 2022, American Girl introduced its newest Girl of the Year, Corinne Tan.

Corinne is a Chinese American growing up with her family in Aspen, Colorado.

She loves hitting the slopes, being a big sister, and training her new puppy to be a search-and-rescue dog.

The American Girl segment sells products directly to consumers through its website, in its proprietary retail stores in the United States, at select retailers nationwide, and at specialty boutiques and franchise stores in Canada.

Competition and Industry Background

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Competition in the toy industry is based primarily on quality, play value, brands, and price.

Mattel offers a diverse range of products for children of all ages and families that include, among others, toys for infants and preschoolers, dolls, vehicles, action figures, construction toys, youth electronics, games, including digital, puzzles, plush, educational toys, technology-related products, media-driven products, and fashion-related toys.

The North America segment competes with several large toy companies, including Hasbro, Jazwares, Just Play Products, LEGO, MGA Entertainment, Melissa & Doug, Spin Master, VTech, Zuru, many smaller toy companies, and manufacturers of video games and consumer electronics.

The International segment competes with global toy companies including Hasbro, JAKKS Pacific, Just Play Products, LEGO, MGA Entertainment, Playmobil, Ravensburger, Simba, Spin Master, VTech, other national and regional toy companies, and manufacturers of video games and consumer electronics.

Mattel offers a diverse range of products for children of all ages and families that include, among others, toys for infants and preschoolers, dolls, vehicles, action figures, building sets, youth electronics, games, including digital, puzzles, plush, educational toys, technology-related products, media-driven products, and fashion-related toys.

The North America segment competes with several large toy companies, including Hasbro, Jazwares, LEGO, MGA Entertainment, the Pokémon Company, Spin Master, many smaller toy companies, and manufacturers of video games and consumer electronics.

The International segment competes with global toy companies including Hasbro, Jazwares, LEGO, MGA Entertainment, the Pokémon Company, Spin Master, other national and regional toy companies, and manufacturers of video games and consumer electronics.

Foreign regions may include competitors that are strong in a particular toy line or geographical area but do not compete with Mattel or other international toy companies worldwide.

The American Girl segment competes with companies that manufacture dolls and accessories, and with children's book publishers and retailers.

Competition among the above companies is intensifying due to trends towards shorter life cycles for individual toy products and an increasing use of more sophisticated technology among consumers.

There is increasing competition among the above companies due to trends towards shorter life cycles for individual toy products and an increasing use of more sophisticated technology among consumers.

In addition, Mattel competes with companies that sell non-toy products, such as electronic consumer products, video games, as well as content and other entertainment companies.

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Mattel's business is highly seasonal, with consumers making a large percentage of all toy purchases during the traditional holiday season.

A significant portion of Mattel’s customers’ purchasing occurs in the third and fourth quarters of Mattel’s fiscal year in anticipation of holiday buying.

A significant portion of retailer purchasing typically occurs in the third and fourth quarters of Mattel's fiscal year in anticipation of holiday buying.

These seasonal purchasing patterns and requisite production lead times create risk to Mattel's business associated with the underproduction of popular toys and the overproduction of less popular toys that do not match consumer demand.

Retailers have also been attempting to manage their inventories more tightly in recent years, requiring Mattel to ship products closer to the time the retailers expect to sell the products to consumers.

These factors increase the risk that Mattel may not be able to meet demand for certain products at peak demand times or that Mattel’s own inventory levels may be adversely impacted by the need to pre-build products before orders are placed.

Additionally, as retailers manage their inventories, Mattel experiences cyclical ordering patterns for products and product lines that may cause its sales to vary significantly from period to period.

The seasonality of Mattel's business increases the risk that Mattel may not be able to meet demand for certain products at peak demand times or that Mattel's own inventory levels may be adversely impacted by the need to pre-build products before orders are placed.

In addition, this seasonality may cause Mattel's sales to vary significantly from period to period.

In anticipation of retail sales during the traditional holiday season, Mattel significantly increases its production in advance of the peak selling period, resulting in a corresponding build-up of inventory levels in the first three quarters of its fiscal year.

Seasonal shipping patterns result in significant peaks in the third and fourth quarters in the respective levels of inventories and accounts receivable, which result in seasonal working capital financing requirements.

See Part II, Item 8 "Financial Statements and Supplementary Data—Note 5 to the Consolidated Financial Statements—Seasonal Financing and Debt."

Seasonal shipping patterns generally result in significant peaks in the third and fourth quarters in the respective levels of inventories and accounts receivable, which may result in seasonal working capital financing requirements.

Through the third quarter of 2022, Mattel accelerated its inventory production to meet demand levels and reduce supply chain risk while retailers also increased their inventory levels to replenish low inventory levels entering 2022 and to meet expected growth in demand ahead of the holiday season.

However, consumer demand was lower than expected during the holiday season, and occurred later than expected in the fourth quarter of 2022, which caused retailers to reduce replenishment orders as they managed their inventory.

Elevated retailer inventory levels are expected to have an unfavorable impact to net sales in 2023, particularly in the first half of the year.

Mattel's products are sold throughout the world.

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Mattel also operates small retail outlets at certain corporate offices as a service to its employees and as an outlet for its products.

Products within the International segment are sold directly to retailers and wholesalers in most European, Latin American, and Asian countries, and in Australia and New Zealand, and through agents and distributors in those countries where Mattel has no direct presence.

Products within the International segment are sold directly to retailers and wholesalers in most European, Latin American, and Asian countries, in Australia and New Zealand, and through agents and distributors in those countries where Mattel has no direct presence.

Mattel also has retail outlets in Latin America that serve as outlets for its products.

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Los Angeles, California;

and New York, New York for its flagship American Girl stores, and in 9 other cities across the United States for its American Girl boutique stores, each of which features children’s products from the American Girl segment.

Additionally, Mattel sells certain of its products online through websites of one or more of its subsidiaries.

During 2021, Mattel’s three largest customers (Walmart at $1.17 billion, Target at $0.74 billion, and Amazon at $0.62 billion) accounted for approximately 46% of worldwide consolidated net sales.

and New York, New York for its flagship American Girl stores, and in six other cities across the United States for its American Girl boutique stores, each of which features children's products from the American Girl segment.

Additionally, Mattel sells certain of its products directly to consumers through its e-commerce platforms.

During 2022, Mattel's three largest customers (Walmart a t $0.95 billion, Tar get at $0.76 billion, a nd Amazon at $0.64 billion) ac counted for approximately 43% of worldwide consolidated net sales.

During 2021, Mattel's three largest customers (Walmart at $1.17 billion, Target at $0.74 billion, and Amazon at $0.62 billion) accounted for approximately 46% of worldwide consolidated net sales.

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See Part I, Item 1A "Risk Factors" and Part II, Item 8 "Financial Statements and Supplementary Data—Note 13 to the Consolidated Financial Statements—Segment Information."

Licenses and Distribution Agreements

License Agreements

Mattel has license agreements with third parties that permit Mattel to utilize the trademark, characters, or inventions of the licensor in products that Mattel sells.

A number of these licenses relate to product lines that are significant to Mattel's business and operations.

Mattel has entered into agreements to license entertainment properties, including among others, Disney Enterprises (including Disney Princess and Frozen, Star Wars , Pixar (including CARS, Lightyear, and Toy Story ) and certain other Disney films and television properties), NBCUniversal (including Fast and Furious , Jurassic World , Minions , and Spirit ), Viacom International relating to its Nickelodeon properties (including Blaze and the Monster Machines ), Warner Bros.

(including Batman , Superman , Wonder Woman , and Justice League ) , Microsoft (including Halo and Minecraft ), WWE , and Sanrio .

Mattel has entered into agreements to license entertainment properties, including among others, Disney Consumer Products (including Disney Princess and Frozen, Star Wars, Disney Pixar (including Cars , Lightyear , and Toy Story ) and certain other Disney films and television properties), NBCUniversal (including Jurassic World, Trolls, and Fast and Furious ), Paramount (relating to its Nickelodeon properties), Warner Bros.

(including Batman, Superman, Wonder Woman, Justice League and Harry Potter ), Microsoft (including Minecraft and Halo ), WWE, and Pokémon .

Royalty expense for 2022, 2021, and 2020 was $230.8 million, $184.3 million, and $158.5 million, respectively.

See Part II, Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Commitments" and Part II, Item 8 "Financial Statements and Supplementary Data—Note 12 to the Consolidated Financial Statements—Commitments and Contingencies."

See Part II, Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital

Resources—Commitments" and Part II, Item 8 "Financial Statements and Supplementary Data—Note 12 to the Consolidated Financial Statements—Commitments and Contingencies."

Mattel licenses a number of its trademarks and other property rights to others for use in connection with the sale of their products.

Mattel also distributes some third-party finished products that are independently designed and manufactured.

Trademarks, Copyrights, and Patents

Most of Mattel’s products are sold under trademarks, trade names, and copyrights, and some of these products incorporate devices or designs for which patent protection has been, or is being, pursued.

Most of Mattel's products are sold under and are associated with trademarks, trade names, and copyrights, and some of these products incorporate devices or designs for which patent protection has been, or is being, pursued.

Trademarks, copyrights, and patents are significant assets of Mattel in that they provide product recognition, acceptance, and exclusive rights to Mattel's innovations around the world.

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Mattel's principal manufacturing facilities are located in China, Indonesia, Malaysia, Mexico, and Thailand.

In conjunction with Mattel's cost savings programs, Mattel discontinued production in 2019 at three plants located in China, Indonesia, and Mexico and discontinued production in 2021 at its plant located in Canada.

To help avoid disruption of its product supply due to political instability, civil unrest, economic instability, changes in government policies or regulations, natural and manmade disasters, and other risks, Mattel produces its products in multiple facilities across multiple countries.

Mattel believes that the existing production capacity at its owned and third-party manufacturers’ facilities is sufficient to handle expected volume in the foreseeable future.

In conjunction with Mattel's cost savings programs, Mattel previously discontinued production at three plants located in China, Indonesia, and Mexico and discontinued production in 2021 at its plant located in Canada.

To help avoid disruption of its product supply due to political instability, civil unrest, future pandemics or other health crises, economic instability, changes in government policies or regulations, natural and manmade disasters, and other risks, Mattel produces its products in various facilities across multiple countries.

Mattel believes that the existing production capacity at its owned and third-party manufacturers' facilities is sufficient to handle expected volume for the foreseeable future.

Mattel bases its production schedules for toy products on customer orders and forecasts, taking into account historical trends, results of market research, and current market information.

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Advertising takes place at varying levels throughout the year and peaks during the traditional holiday season.

Advertising includes television and radio commercials, social media, and magazine, newspaper, and internet advertisements.

Promotions include in-store displays, sweepstakes, merchandising materials, major events focusing on products, and tie-ins with various consumer products companies.

Advertising includes television commercials, social media, catalogs, and internet advertisements.

Promotions include in-store displays, merchandising materials, major events focusing on products, and tie-ins with various consumer products companies.

During 2022, 2021, and 2020, Mattel incurred advertising and promotion expenses of $534.3 million (9.8% of net sales), $545.7 million (10.0% of net sales), and $525.8 million (11.5% of net sales), respectively.

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Mattel seeks to mitigate its exposure to foreign 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.

These contracts have maturity dates of up to 24 months.

In addition, Mattel manages its exposure to currency exchange rate fluctuations through the selection of currencies used for international borrowings.

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Government Regulations

Mattel’s products sold in the United States are subject to the provisions of the Consumer Product Safety Act, as amended by the Consumer Product Safety Improvement Act of 2008, the Federal Hazardous Substances Act, and the Consumer Product Safety Improvement Act of 2008, and may also be subject to the requirements of the Flammable Fabrics Act or the Food, Drug, and Cosmetics Act and the regulations promulgated pursuant to such statutes.

Mattel's products sold in the United States are subject to the provisions of the Consumer Product Safety Act, as amended by the Consumer Product Safety Improvement Act of 2008, and the Federal Hazardous Substances Act, and may also be subject to the requirements of the Flammable Fabrics Act or the Food, Drug, and Cosmetics Act and the regulations promulgated pursuant to such statutes.

These statutes and the related regulations ban from the market consumer products that fail to comply with applicable product safety laws, regulations, and standards.

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Nonetheless, Mattel has experienced, and may in the future experience, issues in products that result in recalls, withdrawals, or replacements of products.

A product recall could have a material adverse effect on Mattel’s results of operations and financial condition, depending on the product affected by the recall and the extent of the recall efforts required.

A product recall could have a material adverse effect on Mattel's business, financial condition, and results of operations, depending on the product affected by the recall and the extent of the recall efforts required.

A product recall could also negatively affect Mattel's reputation and the sales of other Mattel products.

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Privacy-related laws also exist in some U.S.

states, including the recently enacted California Consumer Protection Act.

states, such as the California Consumer Privacy Act, as amended by the California Privacy Rights Act, and other state laws that have taken effect in 2023, or are yet to take effect.

Mattel believes that it is in substantial compliance with these laws and regulations.

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Mattel believes recruiting, developing, and motivating a talented global workforce are key to its long-term growth and success.

Through Mattel’s focus on employee engagement, diversity, equity, and inclusion, training and development, health and safety, and employee well-being, Mattel endeavors to create a supportive and rewarding environment where employees are encouraged to explore, innovate, grow, and lead.

Through Mattel's focus on employee engagement, diversity, equity, and inclusion, training and development, health and safety, and employee well-being, Mattel endeavors to create a supportive and rewarding environment where employees are encouraged to collaborate, innovate, and grow.

As of December 31, 2022, Mattel had approximately 33,900 employees (including temporary and seasonal employees) working in over 35 countries worldwide to create innovative products and experiences that inspire, entertain, and develop children through play.

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The remaining workforce focuses on the design, marketing, sales, finance, and other aspects of Mattel's business.

Mattel’s Board of Directors and Governance and Social Responsibility Committee are involved in the oversight of how the company fosters its culture and receive regular updates on the company’s workforce management, including its diversity, equity, and inclusion initiatives.

Mattel's Board of Directors, Compensation Committee, and Governance and Social Responsibility Committee are involved in the oversight of how the company fosters its culture and receive regular updates on the company's workforce management, including its diversity, equity, and inclusion initiatives.

Employee Engagement

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Mattel values and shares a wide range of ideas and voices that help evolve and broaden its perspectives, with a reach that extends to consumers, customers, business partners, and suppliers.

In August 2021, Mattel published its 2020 Citizenship Report, which described goals and initiatives related to its diversity, equity, and inclusion efforts.

The report highlighted Mattel’s near-term progress toward achieving its goals as of April 2021, including the following achievements:

• Achieved 100% base pay equity globally for all employees performing similar work with comparable roles and experience in similar markets.

In April 2022, Mattel published its 2021 Citizenship Report, which described goals and initiatives related to its diversity, equity, and inclusion efforts.

The report highlighted Mattel's progress on its goals as of December 31, 2021, including the following:

• Maintained 100% base pay equity globally for all employees performing similar work with comparable roles and experience in similar markets.

This includes base pay equity by gender globally and pay equity by ethnicity in the United States.

• Increased representation of women at all levels of the organization, with women comprising 58% of Mattel’s global workforce and 49% of all management positions, excluding manufacturing labor.

• Maintained as a priority representation of women at all levels of the organization, with women comprising 58% of Mattel's global workforce and 47% of all management positions.

• Increased total representation of ethnically diverse employees at all levels of the organization in the United States to 44%.

• Mattel remains focused on actions to increase such representation, including strengthening relationships with schools, networks, and organizations to establish a talent pipeline of women for Technology, Supply Chain, and Finance positions.

* Excludes manufacturing labor and temporary and seasonal employees.

We believe Mattel's Employee Resource Groups ("ERGs") are an integral component of fostering an inclusive culture and enhancing engagement at Mattel.

Mattel employees have created and lead ten ERGs which, bring together members and allies of underrepresented identities across the global organization.

Mattel employees have created and continue to lead ten ERGs, which bring together members and allies of underrepresented identities across the global organization.

The ERGs organize learning opportunities, cultural celebrations, and community outreach, elevate important issues, encourage open and honest conversations, and collect critical feedback.

Mattel has been recognized for its diversity, equity, and inclusion efforts, including by the Human Rights Campaign Foundation as one of the country’s top places to work for LGBTQ+ equality.

Mattel has once again been recognized for its diversity, equity, and inclusion efforts, including by the Human Rights Campaign Foundation as one of the country's top places to work for LGBTQ+ equality in 2022.

For the third consecutive year, Mattel received a perfect score on the Human Rights Campaign Foundation's Corporate Equality Index, a leading benchmarking survey and report measuring corporate policies and practices related to LGBTQ+ workplace equality.

Mattel was also ranked among Forbes 2021 World’s Best Employers and Best Employers for Women;

named to Fast Company’s List of the 100 Best Workplaces for Innovators in 2021 and Newsweek’s 100 Most Loved Workplaces for 2021;

and recognized as a Great Place to Work for 2021.

Mattel was also ranked among Forbes 2022 World's Best Employers and 2023 America's Best Midsize Employers;

named to Fast Company's List of the 100 Best Workplaces for Innovators in 2022;

Computerworld’s list of the Best Places to Work in IT 2023;

and once again was certified by the Great Place to Work Institute in 2022.

Training and Development

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Since then, these principles have become the foundation for Mattel's Responsible Supply Chain Commitment, a comprehensive set of standards and oversight processes that establish Mattel's expectations for responsible factory working conditions, environmental protections, social compliance, health, and safety in both its own manufacturing facilities and those of its supply chain partners.

Over the course of the COVID-19 pandemic, Mattel has prioritized protecting the health and safety of its employees while at the same time mitigating the disruption to its business.

Mattel implemented stringent health and safety measures, process controls, operating procedures, and training to help provide a safe and sanitary working environment for employees.

Mattel also transitioned employees, as appropriate based on role, to a work-from-home system and increased the use of virtual meeting technologies.

Mattel offers several benefits to promote employee well-being, including flexible work hours and/or paid time off, health and welfare insurance options, retirement plans, and basic and supplemental employee life insurance for eligible individuals.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business