NEW YORK – Dolls are conquering the world.
Strength of doll brands like Barbie and Monster High around the world helped Mattel’s net income rise 16 percent in the third quarter, a positive sign ahead of the all-important holiday season.
Its performance beat Wall Street expectations and shares rose nearly 5 percent in morning trading.
The quarterly results come as toy makers gear up for the holiday season, which can account for up to half of their annual revenue. Toy sales overall have been weak in North America, Europe and Australia, due to a weak video game market, an uncertain economy and continued popularity of electronic gadgets like smartphones and tablets. But Mattel, the largest U.S. toy maker with many popular brands, has fared better than its competitors.
Barbie, the No. 1 doll brand, reversed four straight quarters of sales decline to increase 3 percent during the quarter. Dolls in general continued to be a strong category, with sales of Monster High and American Girl also rising.
Fisher-Price brands remained a weak spot with flat sales. Hot Wheels also remained challenged with sales down 2 percent. “Retail for core Fisher-Price was slower than expected in the U.S., but consumer takeaway outside of the U.S. was strong,” said Geoff Walker, executive vice president Fisher-Price Global Brands. “We are working vigorously to improve the remainder of the 2013 selling season by closely monitoring our marketing efforts at major retailers.” Fisher-Price saw “double-digit growth” within its Friends portfolio, driven by its Thomas & Friends and Mike the Knight properties, while gains made in Core Fisher-Price were offset by a “tough quarter” in baby gear, Walker said. The East Aurora company sees Fisher-Price’s greatest growth potential in its international markets.
For the three months ended Sept. 30, Mattel earned $422.8 million, or $1.21 per share. That’s up from $365.9 million, or $1.04 per share, in the prior-year period. Removing a tax benefit of 5 cents per share, earnings were $1.16 per share. Analysts predicted earnings of $1.11 per share. Revenue rose 6 percent to $2.21 billion from $2.08 billion. Wall Street expected $2.175 billion in revenue.
Mattel Inc. also declared a fourth-quarter dividend of 36 cents per share.
News Business Reporter Samantha Maziarz Christmann contributed to this report.