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Mattel shares climbed 7% on Thursday in prolonged trading after the company recorded a smaller-than-expected loss in the second quarter and posted solid sales of its Barbie dolls and Hot Wheels cars.
"This quarter also reflects the continued momentum of our multi-year turnaround strategy," said Ynon Kreiz, Mattel's President and CEO, in a statement.
Mattel had struggled after the bankruptcy and eventual closure of Toys R Us last year. In particular, this is the first quarter in which shipments to Toys R Us have no impact on comparisons. Toys R Us closed all branches by June 29, 2018.
Mattel's net loss was reduced to $ 108 million, or 31 cents per share, compared to a loss of $ 241 million, or 70 cents per share, in the same period last year.
After adjusting for non-recurring items, Mattel lost 25 cents per share. Analysts had predicted that Mattel would lose 40 cents per share.
The company's net sales increased 2% to $ 860.1 million in the first quarter ended June 30th, exceeding the $ 813 million expected by badysts, according to Refinitiv data.
During the quarter, Barbie sales increased 9% and Hot Wheels sales increased 5%. However, once again, American Girl and Fisher-Price saw their sales decline.
"The heart of Fisher-Price shows a trend of improvement," Kreiz said in a call for results Thursday. "We expect further progress in the second half."
The company is about to launch new products for young children based on "Toy Story 4" and "Frozen 2."
In recent years, more and more children have turned to video games and electronics rather than to traditional toys. Mattel has also been hit hard by the bankruptcy of Toys R Us.
Under Kreiz, Mattel has adopted a two-pronged strategy to transform the struggling toy maker.
Kreiz had forecast cost reductions of $ 650 million through actions such as the laying off of 2,200 workers and the closure of his office in New York. On Thursday, he revealed that the company had surpbaded this goal by reducing its spending by $ 754 million and that it would remove another $ 100 million before the end of the year.
Kreiz also hopes to boost sales by creating a film department to present its famous toy properties on the big screen. The company asked Margot Robbie ("Suicide Squad", "Tonya") to play Barbie and will produce a live action film, Hot Wheels, an American Girl movie, a Masters of the film. Universe and a movie based on View. Control.
On Thursday, he announced that Mattel would partner with Blumhouse Productions to create a movie based on the Magic 8 Ball. Blumhouse is best known for translating small budgets into huge box office receipts and has been responsible for the profitable and popular "Paranormal Activity" movies as well as for "Get Out", an Oscar winner.
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