Last year’s toy sales slump that bled over into the first half of 2023 was still evident in the Q2 results Mattel announced yesterday, but the company is banking on new theatrical darling Barbie to create a sales boom in its summer and holiday seasons. 

Mattel reported just over US$1.08 billion in net sales for Q2, a decline of 12% compared to the same period last year (US$1.24 billion). This drop was driven by the continued impact of retailers struggling to manage inventory levels and their lackluster spending on toys, according to Mattel’s chief financial officer Anthony DiSilvestro. 

The toyco’s second quarter covers April, May and June, so it wrapped before the Barbie movie premiered, but there were already glimmers of a sales boom developing. 

The leadup to the release of Mattel and WBD’s box-office hit had an obvious impact on worldwide doll sales in Q2. The category generated more than US$441 million in gross billings, a sharp increase of 10% over last year’s US$401 million. Barbie’s movie tie-in toys were major drivers and quickly sold out across Mattel’s major distribution channels, according to the report. The toyco is working to expand this range further in the next two quarters.

Barbiemania is being felt worldwide, and the live-action feature has already raked in more than US$470 million at the global box office just five days after its release. Beyond the toy aisle, Mattel has inked more than 165 consumer products deals for the film, with key partners including Warner Music (movie soundtrack), Spirit Halloween (costumes) and Hot Topic, which is selling a capsule collection featuring Babriecore apparel, jewelry and accessories. Since its June premiere, HGTV’s unscripted series Barbie Dreamhouse Challenge has been watched by nearly four million viewers on the linear TV channel alone. 

DiSilvestro is looking forward to the second half of the year, and believes that the inventory issues at retail are mostly over. Mattel expects overall net sales for the full year to be comparable or flat compared to last year’s total of US$5.4 billion.

“Mattel’s second-quarter financial results were in line with our expectations. We significantly increased free cash flow and continued to gain market share,” said CEO Ynon Frietz in the release. “Importantly, this moment will be remembered as a key milestone in our company’s history with the release of the Barbie movie, our first-ever major theatrical film.”

Vehicles also experienced an 11% bump in gross billings to US$364 million, but both preschool (down 28% to US$197 million) and action figures (down 39% to US$226 million) posted sharp declines.

Geographically, sales were down in Mattel’s largest distribution territories in Q2, with North America reporting a 18% decline to US$637 million and EMEA falling 7% to US$304 million. Meanwhile, Latin America posted the largest quarterly increase, with sales in the region up 11% to US$161 million over the same period last year.