What changed in this filing

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Item 1. Business

2025-02-26 compared with 2024-03-15 · 66 added, 80 removed, 137 unchanged (52% of the section changed)

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Mattel creates innovative products and experiences that inspire fans, entertain audiences, and develop children through play.

Mattel is focused on the following evolved strategy to grow its intellectual property ("IP") driven toy business and expand its entertainment offering:

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;

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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, American Girl, Disney Princess and Disney Frozen, Monster High, and Polly Pocket .

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

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 Imaginext ) and Thomas & Friends .

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 ).

Monster High , a character-driven franchise, engages fans of all ages, encouraging them to be their authentic selves and celebrate what makes them unique.

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 is dedicated to 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 lays the tracks to inspire, entertain, and develop young 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 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 is strategically out-licensing or exiting certain product lines.

Vehicles —including brands such as Hot Wheels (including Hot Wheels Monster Trucks and Hot Wheels 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.

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Business Segments

Mattel's operating segments are:

(i) North America, which consists of the United States and Canada;

(ii) International;

and (iii) American Girl.

The North America and International segments sell products across Mattel's categories, although some products are developed and adapted for particular international markets.

In the first quarter of 2024, Mattel implemented an organizational change integrating the American Girl business into Mattel's North America commercial organization, which resulted in a change to Mattel's operating and reportable segments.

Mattel's new 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 sold only in North America.

For additional information on Mattel's worldwide gross billings by brand category, see Part II, Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations."

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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 2024, Barbie will look to continue to capitalize on the successful live action theatrical movie to help drive the full Barbie franchise, including toys, consumer products, and gaming.

Barbie will be celebrating its 65 th anniversary with numerous activations, and also launch exciting new product lines and play patterns.

In 2025, Barbie will continue to inspire multi-generational fans by delivering new products and captivating experiences through the year-long Limitless Possibilities marketing campaign, which Mattel expects will further amplify the franchise's impact globally.

Mattel is also excited to build upon its strong partnerships with Disney for the Disney Princess and Disney Frozen product lines.

Monster High will look to build upon the success of its global re-launch, including planned new content and product offerings.

American Girl is a direct marketer, retailer, and children's publisher dedicated to its mission to help girls grow up with courage, confidence, and strength of character.

In 2025, American Girl looks to build on its momentum from 2024 with quality product drops, multiplatform content launches, immersive omnichannel experiences, and new promotional campaigns geared towards kids, shoppers, and adult fans.

Infant, Toddler, and Preschool

In 2024, 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 enriching the first five years of childhood for every family.

Consumer-centric innovation will continue to drive new product offerings, including the expansion of Linked Play within Infant and new innovative toys from Imaginext , including new licensed entertainment offerings.

Fisher-Price will add Fisher-Price Wood and continue its strong momentum in the Little People product line with the expansion of the Little People Barbie line and Little People Collector line.

In 2024, industry leader Hot Wheels will look to continue its strong momentum as a multigenerational franchise with consumer interest that remains at historic highs.

In 2025, Fisher-Price will continue its focus on engaging consumers as a trusted partner for families with infants, toddlers and preschoolers, and remain dedicated to giving families the best possible start to life.

Consumer-centric innovation will continue to drive new product offerings across the portfolio.

Fisher-Price Wood will continue to expand globally, leveraging popular themes and trend-based aesthetics, while Little People will look to build on its strong momentum with the expansion of the Little People Core line and Little People Collector line.

Thomas & Friends will be celebrating its 80 th anniversary with numerous activations throughout the year and also launch exciting new products with classic characters and train play.

In 2025, industry leader Hot Wheels expects to continue its strong momentum as a multigenerational franchise with consumer interest that remains at historic highs.

Hot Wheels product offerings are expected to excite consumers with innovation in both die-cast vehicles and tracks and playsets.

These offerings will be supported by an all-new animated children's series on Netflix, Hot Wheels Let’s Race , and the expansion of the Hot Wheels Racerverse line.

These offerings will be supported by the animated children's series on Netflix, Hot Wheels Let ' s Race , and the new exciting partnership with Formula 1 , bringing fans of the sport a full range of Hot Wheels products.

Hot Wheels also seeks to further expand die-cast vehicle distribution, targeting fans of all ages.

Die-cast pioneer Matchbox expects to continue to bring exciting new products to market following its successful 70 th anniversary, including new sustainable die-cast products, and new episodes of the globally popular YouTube series, Matchbox Adventures .

Mattel will continue to partner with Disney Pixar for Cars to drive innovation, including fresh new product offerings to support key marketing events in 2024.

Die-cast pioneer Matchbox expects to continue to bring exciting new products to market, including new sustainable die-cast products and toys tied to the theatrical release of NBCUniversal ' s Jurassic World:

Mattel will continue to partner with Disney Pixar for Cars to drive innovation, including fresh new product offerings to support key promotional events in 2025.

Action Figures, Building Sets, Games, and Other

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.

Mattel's 2024 Action Figures product lines will include toys tied to Netflix content for NBCUniversal’s Jurassic World ( Jurassic World:

Chaos Theory ) and Masters of the Universe ( Masters of the Universe:

Revolution ) as well as new innovation within Minecraft and WWE .

Mattel's 2025 Action Figures product lines will include toys tied to theatrical releases for NBCUniversal ' s Jurassic World:

Rebirth and Microsoft ' s Minecraft ( Minecraft the Movie ), as well as new releases within Masters of the Universe and WWE .

In Building Sets, MEGA inspires creativity through authentic building experiences for builders of all ages and fans of global franchises.

Partnerships with some of the world's top franchises, including Pokémon 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.

Partnerships with some of the world's top franchises, including Pokémon , 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 Games consists of some of the most beloved Games IP in the world including UNO , Pictionary , Skip-Bo , Phase-10, Blokus , and many others.

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

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No individual country within the International segment exceeded 7% of worldwide consolidated net sales during 2024.

American Girl Segment

The American Girl segment is a direct marketer, retailer, and children's publisher dedicated to its mission to help girls grow up with confidence and character.

American Girl is best known for its line of historical and contemporary characters that feature 18" dolls, books, and accessories that inspire girls to face the world with courage, resilience, and kindness.

The contemporary Truly Me and Create Your Own lines encourage girls to express their imaginations and creativity by choosing a doll that looks like them or custom-creating one that's completely unique from more than one million options.

Bitty Baby introduces younger girls to nurturing play until they are ready for WellieWishers , a sweet group of girls who focus on empathy and being a good friend.

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 through its website, proprietary retail stores in the United States, and at select retailers in the United States.

Competition and Industry Background

Mattel is a worldwide leader in the manufacture, marketing, and sale of toys, games, and other products related to play, learning, and development.

Mattel is a worldwide leader in the manufacture, marketing, and sale of toys, games, and other products related to play, entertainment, learning, and development.

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

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

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

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

The North America segment also includes American Girl products which compete with companies that manufacture dolls and accessories, and with children's book publishers and retailers.

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.

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.

There is increasing competition among the above companies due to trends towards shorter life cycles for individual toy products, the phenomenon of children outgrowing toys at younger ages, an increasing use of more sophisticated technology in toys, including machine learning and artificial intelligence ("AI"), and an evolving path to purchase for consumers.

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

Competition continues to be heavily influenced by the fact that a small number of retailers account for a large portion of all toy sales, allocate the shelf space from which toys are viewed, and have direct contact with parents and children through in-store and online purchases.

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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 retailer purchasing typically 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 the 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.

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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 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.

Additionally, seasonal shipping patterns generally result in significant increases in accounts receivable during the third and fourth quarters of the year.

The elevated accounts receivable and inventory levels may result in seasonal working capital financing requirements.

Mattel's products are sold throughout the world.

Products within the North America segment are sold directly to retailers, including omnichannel retailers, discount and free-standing toy stores, chain stores, department stores, other retail outlets, and, to a limited extent, wholesalers.

Products within the North America segment include products sold directly to retailers, including omnichannel retailers, discount and free-standing toy stores, chain stores, department stores, other retail outlets, and, to a limited extent, wholesalers.

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, 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.

American Girl products and its children's publications are sold directly to consumers and select retailers in the United States.

The North America segment also includes American Girl products and its children's publications, which are sold directly to consumers and select retailers in the United States.

Mattel has retail space in Chicago, Illinois;

Los Angeles, California;

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

and New York, New York for its flagship American Girl stores, and in four other cities across the United States for its American Girl boutique stores.

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

Additionally, Mattel sells certain of its products directly to consumers through its e-commerce platform and various third-party e-commerce channels.

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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 Consumer Products (including Disney Princess and Disney Frozen, Star Wars, Disney Pixar (including Cars 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 DC Universe and Harry Potter ), Microsoft (including Minecraft and Halo ), WWE, and Pokémon .

(including DC Universe and Harry Potter ), Microsoft (including Minecraft and Halo ), WWE, Pokémon, and Paramount (relating to its Nickelodeon properties).

Royalty expense for 2024, 2023, and 2022 was $244.1 million, $249.8 million, and $230.8 million, respectively.

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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, in 2021, Mattel discontinued production at its plant located in Canada.

In addition, Mattel intends to discontinue production at a plant located in China in 2024.

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.

In conjunction with Mattel's cost savings programs, Mattel discontinued production at a plant located in China in 2024 and intends to discontinue production at another plant located in China in 2025.

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, including tariffs, trade restrictions, or trade barriers, 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.

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See Part I, Item 1A "Risk Factors."

Advertising and Marketing

Advertising and Promotion

Mattel supports its product lines with extensive advertising and consumer promotions.

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Currency exchange rate fluctuations may impact Mattel's results of operations and cash flows.

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.

Mattel seeks to mitigate its exposure to 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 have maturity dates of up to 24 months.

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See Part I, Item 1A "Risk Factors."

Mattel's advertising and marketing activities are subject to the Federal Trade Commission Act and the Children's Television Act of 1990 and may also be subject to other rules and regulations promulgated by the Federal Trade Commission, and the Federal Communications Commission, as well as laws of certain countries that regulate advertising, advertising to children, and related activities.

Mattel's advertising and promotion activities are subject to the Federal Trade Commission Act and the Children's Television Act of 1990 and may also be subject to other rules and regulations promulgated by the Federal Trade Commission, and the Federal Communications Commission, as well as laws of certain countries that regulate advertising, advertising to children, and related activities.

In addition, Mattel's web-based products and services and other online and digital communications activity are or may be subject to U.S.

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

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

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

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

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Approximately 29,600 employees (86% of the total workforce) are located outside the United States, with a significant global manufacturing labor workforce of approximately 25,100 employees.

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

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

Mattel believes recruiting, developing, and motivating a talented global workforce are important 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 collaborate, innovate, and grow.

Through Mattel's focus on employee engagement, equal employment opportunity, 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.

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 Mattel's workforce management.

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

named to Fast Company's list of the Best Workplaces for Innovators in 2023;

recognized by U.S.

News as one of the Best Companies to Work For 2023-2024;

named to Newsweek America’s Greatest Workplaces for Women 2023 and America's Greatest Workplaces for Diversity 2024;

and honored by Computerworld as one of the Best Places to Work in IT in 2023 and 2024.

Mattel has once again been recognized for its diversity, equity, and inclusion efforts, including by the Human Rights Campaign Foundation as a 2023-2024 "Equality 100 Award" recipient.

For the fourth consecutive year, Mattel received a perfect score on the Human Rights Campaign Foundation's Corporate Equality Index.

Mattel was ranked among Forbes 2024 World's Best Employers;

named to Fast Company's Most Innovative Companies of 2024 and Best Workplaces for Innovators in 2024;

recognized by Newsweek as one of the World's Most Trustworthy Companies of 2024;

honored by TIME as one of America's Best Mid-Size Companies of 2024;

named to Computerworld's 2024 Best Places to Work in IT;

and certified as a Great Place to Work in multiple countries.

Workplace Culture

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Mattel values 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 September 2023, Mattel published its 2022 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, 2022, including the following:

• Maintained 100% base pay equity in 2022 for similar work performed in similar markets by gender globally and by ethnicity in the United States.

• Continued to achieve a high level of representation for women, who comprised 57% of Mattel's global workforce and 48% of managers and above in 2022.

• Continued to achieve a high level of representation for ethnically diverse employees, who made up 45% of U.S.

employees in 2022.

• 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.

Mattel believes that 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 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.

Employee Development and Well-Being

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Additionally, offering the opportunity for employees to continuously learn and grow their careers at Mattel is a key driver of its employee engagement strategy.

In 2023, employees at all levels around the globe participated in several hundred thousand hours of online classes and instructor-led training regarding professional development, management development, and technical training.

Around the globe, employees at all levels participate in a variety of online classes and instructor-led training, including professional development, management development, and technical training.

Mattel is focused on creating a safe and healthy workplace for all of its employees.

This is reflected in a comprehensive set of standards and oversight processes that establish Mattel's expectations for responsible working conditions, environmental protections, social compliance, health, and safety in both its own manufacturing facilities and those of its supply chain partners.

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, as well as programs targeted at matters such as maintaining work/life balance and improving health and happiness.

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

Available Information

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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