Mattel’s performance in the third quarter was received positively by the market, despite missing analyst revenue targets. Management attributed the results to strength in its vehicles segment, especially Hot Wheels, which is approaching $2 billion in annual sales. CEO Roger Lynch highlighted operational improvements and pointed to a significant boost in adjusted gross margin due to one-time tariff refunds. He also acknowledged the need for more consistent execution, especially in the Barbie brand, which underperformed compared to other categories. Lynch said, “Our focus is on doing that with more consistency with Barbie.”
Is now the time to buy MAT? Find out in our full research report (it’s free for active Edge members).
Mattel (MAT) Q3 2026 highlights:
- Revenue $1.81 billion vs S&P analyst consensus of $1.83 billion (4.1% year-on-year growth, 1.4% miss)
- Adjusted EPS $1.30 vs S&P analyst consensus of $0.94 (38.3% beat)
- Adjusted EBITDA $542.5 million vs analyst estimates of $453.4 million (30% margin, 19.7% beat)
- Adjusted EPS guidance Management lowered its full-year adjusted EPS guidance to $1.13 at the midpoint, a 15.4% decrease
- Operating margin 26.9%, up from 22.2% in the same quarter last year
- Market capitalization $4.39 billion
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our top 5 analyst questions from Mattel’s Q3 earnings call
- Eric Handler (Roth Capital Partners) inquired about the balance between cost-cutting and investment. CEO Roger Lynch said further efficiencies will come from prioritization and leveraging AI for productivity gains.
- Anthony Bonadio (Wells Fargo) asked if the revised outlook was industry-driven or Mattel-specific. CFO Peter Griffith replied that the softer demand was observed broadly but did not specify if it was unique to Mattel.
- Chris Horvers (JPMorgan) questioned brand-specific trends, especially for Barbie and Hot Wheels. Lynch confirmed Hot Wheels continues to perform well, while Barbie’s performance remains a focus area for improvement.
- Arpine Kocharyan (UBS) sought clarity on the shift to a more toy-centric strategy and implications for digital investments. Lynch described the approach as a focus change, not a strategy change, with digital expansion contingent on strengthening the core toy business.
- Xian Siew (BNP Paribas) asked about retailer inventory levels and whether the lowered guide was proactive. Griffith stated retailer inventories have declined versus last year, and Mattel’s own inventory is stable, as retailers are buying closer to demand.
Catalysts in upcoming quarters
In upcoming quarters, our analysts will watch (1) whether Mattel’s efforts to revitalize Barbie lead to improved sales trends, (2) the pace of international growth in vehicles and challenger categories, and (3) execution of cost discipline and technology-driven productivity initiatives. The ability to maintain or expand operating margins amid shifting consumer demand will also remain a key marker of successful execution.
Mattel currently trades at $15.41, up from $14.97 just before the earnings. Is there an opportunity in the stock? Find out in our full research report (it’s free).
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