Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 19, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document period end date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-05647 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 95-1567322 | |
Entity Address, Address Line One | 333 Continental Blvd. | |
Entity Address, City or Town | El Segundo, | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90245-5012 | |
City Area Code | 310 | |
Local Phone Number | 252-2000 | |
Title of 12(b) Security | Common stock, $1.00 per share | |
Trading Symbol | MAT | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Small Business | false | |
Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 348,775,829 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | MATTEL INC /DE/ | |
Entity Central Index Key | 0000063276 | |
Current Fiscal Year End Date | --12-31 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Current Assets | |||
Cash and equivalents | $ 615,238 | $ 762,181 | $ 499,407 |
Accounts receivable, net of allowances for credit losses of $13.1 million, $20.9 million and $15.9 million, respectively | 680,642 | 1,033,966 | 528,522 |
Inventories | 609,835 | 514,673 | 560,645 |
Prepaid expenses and other current assets | 187,186 | 172,070 | 218,516 |
Total current assets | 2,092,901 | 2,482,890 | 1,807,090 |
Noncurrent Assets | |||
Property, plant, and equipment, net | 451,001 | 473,794 | 519,777 |
Right-of-use assets, net | 294,819 | 291,601 | 298,288 |
Goodwill | 1,392,289 | 1,393,834 | 1,382,852 |
Other noncurrent assets | 871,306 | 878,970 | 796,345 |
Total Assets | 5,102,316 | 5,521,089 | 4,804,352 |
Current Liabilities | |||
Short-term borrowings | 878 | 969 | 150,000 |
Accounts payable | 361,902 | 495,363 | 306,440 |
Accrued liabilities | 689,686 | 831,922 | 657,254 |
Income taxes payable | 30,106 | 27,125 | 12,290 |
Total current liabilities | 1,082,572 | 1,355,379 | 1,125,984 |
Noncurrent Liabilities | |||
Long-term debt | 2,837,732 | 2,854,664 | 2,848,924 |
Noncurrent lease liabilities | 255,670 | 249,353 | 262,631 |
Other noncurrent liabilities | 452,411 | 465,350 | 408,930 |
Total noncurrent liabilities | 3,545,813 | 3,569,367 | 3,520,485 |
Stockholders’ Equity | |||
Common stock $1.00 par value, 1.0 billion shares authorized; 441.4 million shares issued | 441,369 | 441,369 | 441,369 |
Additional paid-in capital | 1,836,958 | 1,842,680 | 1,836,067 |
Treasury stock at cost: 92.6 million shares, 94.5 million shares and 93.2 million shares, respectively | (2,267,961) | (2,282,939) | (2,316,110) |
Retained earnings | 1,424,591 | 1,539,809 | 1,202,440 |
Accumulated other comprehensive loss | (961,026) | (944,576) | (1,005,883) |
Total stockholders’ equity | 473,931 | 596,343 | 157,883 |
Total Liabilities and Stockholders’ Equity | $ 5,102,316 | $ 5,521,089 | $ 4,804,352 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Statement of Financial Position [Abstract] | |||
Accounts receivable, allowances for credit losses | $ 13.1 | $ 15.9 | $ 20.9 |
Common stock, par value (USD per share) | $ 1 | $ 1 | $ 1 |
Common stock authorized (in shares) | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 |
Common stock issued (in shares) | 441,400,000 | 441,400,000 | 441,400,000 |
Treasury stock (in shares) | 92,600,000 | 93,200,000 | 94,500,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Net Sales | $ 874,192 | $ 594,069 |
Cost of sales | 465,188 | 338,886 |
Gross Profit | 409,004 | 255,183 |
Advertising and promotion expenses | 74,096 | 76,282 |
Other selling and administrative expenses | 303,870 | 328,711 |
Operating Income (Loss) | 31,038 | (149,810) |
Interest expense | 130,482 | 48,980 |
Interest (income) | (820) | (2,084) |
Other non-operating (income) expense, net | (1,086) | 3,023 |
Loss Before Income Taxes | (97,538) | (199,729) |
Provision for income taxes | 20,305 | 11,892 |
Income from equity method investments | 2,625 | 880 |
Net Loss | $ (115,218) | $ (210,741) |
Net Loss Per Common Share - Basic (USD per share) | $ (0.33) | $ (0.61) |
Weighted average number of common shares (in shares) | 349,041 | 346,867 |
Net Loss Per Common Share - Diluted (USD per share) | $ (0.33) | $ (0.61) |
Weighted average number of common and potential common shares (in shares) | 349,041 | 346,867 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net Loss | $ (115,218) | $ (210,741) |
Other Comprehensive Loss, Net of Tax | ||
Currency translation adjustments | (28,133) | (145,634) |
Employee benefit plan adjustments | 2,348 | 3,060 |
Net unrealized gains on available-for-sale security | 1,964 | 195 |
Net unrealized gains on derivative instruments: | ||
Unrealized holding gains | 4,057 | 9,190 |
Reclassification adjustments included in net loss | 3,314 | (3,210) |
Net unrealized gains on derivative instruments | 7,371 | 5,980 |
Other Comprehensive Loss, Net of Tax | (16,450) | (136,399) |
Comprehensive Loss | $ (131,668) | $ (347,140) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash Flows From Operating Activities: | ||
Net Loss | $ (115,218) | $ (210,741) |
Adjustments to reconcile net loss to net cash flows used for operating activities: | ||
Depreciation | 36,533 | 43,654 |
Amortization | 9,514 | 9,965 |
Share-based compensation | 15,112 | 14,275 |
Bad debt expense | 237 | 5,248 |
Inventory obsolescence | 10,892 | 10,190 |
Deferred income taxes | 1,851 | 5,210 |
Income from equity method investments | (2,625) | (880) |
Loss on extinguishment of long-term borrowings | 83,213 | 0 |
(Gain) loss on sale of assets/business, net | (19,735) | 1,580 |
Changes in assets and liabilities: | ||
Accounts receivable | 338,305 | 365,002 |
Inventories | (135,103) | (109,938) |
Prepaid expenses and other current assets | (12,943) | (16,343) |
Accounts payable, accrued liabilities, and income taxes payable | (262,635) | (316,291) |
Other, net | 11,369 | 24,580 |
Net cash flows used for operating activities | (41,233) | (174,489) |
Cash Flows From Investing Activities: | ||
Purchases of tools, dies, and molds | (18,171) | (11,363) |
Purchases of other property, plant, and equipment | (12,119) | (23,943) |
Payments of foreign currency forward exchange contracts, net | (3,245) | (46,565) |
Proceeds from sale of assets/business | 39,208 | 738 |
Other, net | 653 | (24) |
Net cash flows provided by (used for) investing activities | 6,326 | (81,157) |
Cash Flows From Financing Activities: | ||
(Payments of) proceeds from short-term borrowings, net | (91) | 150,000 |
Payments of long-term borrowings | (1,287,022) | 0 |
Proceeds from long-term borrowings, net | 1,188,000 | 0 |
Other, net | (6,592) | (678) |
Net cash flows (used for) provided by financing activities | (105,705) | 149,322 |
Effect of Currency Exchange Rate Changes on Cash and Equivalents | (6,331) | (24,297) |
Decrease in Cash and Equivalents | (146,943) | (130,621) |
Cash and Equivalents at Beginning of Period | 762,181 | 630,028 |
Cash and Equivalents at End of Period | $ 615,238 | $ 499,407 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Loss |
Beginning balance at Dec. 31, 2019 | $ 491,714 | $ 441,369 | $ 1,825,569 | $ (2,318,921) | $ 1,413,181 | $ (869,484) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (210,741) | (210,741) | ||||
Other comprehensive loss, net of tax | (136,399) | (136,399) | ||||
Issuance of treasury stock for restricted stock units vesting | (966) | (3,777) | 2,811 | |||
Share-based compensation | 14,275 | 14,275 | ||||
Ending balance at Mar. 31, 2020 | 157,883 | 441,369 | 1,836,067 | (2,316,110) | 1,202,440 | (1,005,883) |
Beginning balance at Dec. 31, 2020 | 596,343 | 441,369 | 1,842,680 | (2,282,939) | 1,539,809 | (944,576) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net loss | (115,218) | (115,218) | ||||
Other comprehensive loss, net of tax | (16,450) | (16,450) | ||||
Issuance of treasury stock for stock option exercises | 1,110 | (803) | 1,913 | |||
Issuance of treasury stock for restricted stock units vesting | (6,966) | (20,031) | 13,065 | |||
Share-based compensation | 15,112 | 15,112 | ||||
Ending balance at Mar. 31, 2021 | $ 473,931 | $ 441,369 | $ 1,836,958 | $ (2,267,961) | $ 1,424,591 | $ (961,026) |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair statement of the financial position and interim results of Mattel, Inc. and its subsidiaries ("Mattel") as of and for the periods presented have been included. The December 31, 2020 balance sheet data was derived from audited financial statements; however, the accompanying interim notes to the consolidated financial statements do not include all of the annual disclosures required by GAAP. As Mattel's business is seasonal, results for interim periods are not necessarily indicative of those that may be expected for a full year. The financial information included herein should be read in conjunction with Mattel's consolidated financial statements and related notes in the 2020 Annual Report on Form 10-K. Certain prior period amounts have been reclassified to conform to the current period presentation. |
Accounts Receivable
Accounts Receivable | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts Receivable Mattel estimates current expected credit losses based on collection history and management’s assessment of the current economic trends, business environment, customers’ financial condition, accounts receivable aging, and customer disputes that may impact the level of future credit losses. Accounts receivable are net of allowances for credit losses of $13.1 million, $20.9 million, and $15.9 million as of March 31, 2021, March 31, 2020, and December 31, 2020, respectively. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories include the following: March 31, March 31, December 31, (In thousands) Raw materials and work in process $ 119,417 $ 107,880 $ 110,010 Finished goods 490,418 452,765 404,663 $ 609,835 $ 560,645 $ 514,673 |
Property, Plant, and Equipment
Property, Plant, and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment, net includes the following: March 31, March 31, December 31, (In thousands) Land $ 22,029 $ 24,856 $ 24,913 Buildings 312,114 297,910 335,407 Machinery and equipment 764,276 769,761 772,349 Software 345,477 367,143 344,268 Tools, dies, and molds 603,817 719,615 607,915 Leasehold improvements 119,828 179,872 131,578 2,167,541 2,359,157 2,216,430 Less: accumulated depreciation (1,716,540) (1,839,380) (1,742,636) $ 451,001 $ 519,777 $ 473,794 During the three months ended March 31, 2021, Mattel completed the sale of a manufacturing plant based in Mexico, which included land and buildings, resulting in a pre-tax gain o f $15.8 million. The assets sold were previously designated as held for sale, and included within property, plant, and equipment, net in the consolidated balance sheets as of December 31, 2020 and March 31, 2020. |
Goodwill
Goodwill | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Goodwill is allocated to various reporting units, which are at the operating segment level, for the purpose of evaluating whether goodwill is impaired. Mattel's reporting units are: (i) North America, (ii) International, and (iii) American Girl. Components of the operating segments have been aggregated into a single reporting unit as the components have similar economic characteristics. The similar economic characteristics include the nature of the products, the nature of the production processes, the customers, and the manner in which the products are distributed. Mattel tests its goodwill for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying value of a reporting unit may exceed its fair value. The change in the carrying amount of goodwill by operating segment for the three months ended March 31, 2021 is shown below. Brand-specific goodwill held by foreign subsidiaries is allocated to the North America segment, thereby causing a foreign currency translation impact. During the three months ended March 31, 2021, Mattel sold its arts, crafts, and stationery business resulting in a reduction of goodwill of approximately $2 million. December 31, Dispositions Currency March 31, (In thousands) North America $ 733,401 $ (1,290) $ 259 $ 732,370 International 452,862 (1,056) 542 452,348 American Girl 207,571 — — 207,571 $ 1,393,834 $ (2,346) $ 801 $ 1,392,289 |
Other Noncurrent Assets
Other Noncurrent Assets | 3 Months Ended |
Mar. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Noncurrent Assets | Other Noncurrent Assets Other noncurrent assets include the following: March 31, March 31, December 31, (In thousands) Identifiable intangible assets (net of accumulated amortization of $296.4 million, $258.0 million, and $286.9 million, respectively) $ 509,844 $ 534,044 $ 518,190 Deferred income taxes 71,157 62,674 72,682 Mattel's amortizable intangible assets primarily consist of trademarks. Mattel tests its amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Mattel's amortizable intangible assets were not impaired during the three months ended March 31, 2021 and 2020. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued liabilities include the following: March 31, March 31, December 31, (In thousands) Incentive compensation $ 143,414 $ 135,833 $ 126,601 Advertising and promotion 78,755 71,563 163,181 Current lease liabilities 73,155 78,247 79,540 Royalties 24,191 22,701 54,442 |
Seasonal Financing
Seasonal Financing | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Seasonal Financing | Seasonal Financing On December 20, 2017, Mattel entered into a syndicated facility agreement, which was subsequently amended in 2018, 2019, and 2021 (as amended, the "Credit Agreement"), as a borrower (in such capacity, the "Borrower") and guarantor thereunder, along with certain of the Borrower's domestic and foreign subsidiaries as additional borrowers and/or guarantors thereunder. On March 19, 2021, Mattel entered into the fourth amendment to the Credit Agreement, which amended certain terms, including, but not limited to, certain components of the borrowing base, a reduction of the aggregate principal commitments of the senior secured revolving credit facilities (the "senior secured revolving credit facilities") from $1.60 billion to $1.40 billion, and an extension of the maturity date from November 18, 2022 to March 19, 2024. The senior secured revolving credit facilities consist of (i) an asset based lending facility with aggregate commitments up to $1.11 billion, subject to borrowing base capacity, secured by substantially all of the accounts receivable and inventory of the Borrower and certain of its subsidiaries who are borrowers and/or guarantors under the Credit Agreement, as well as (ii) a revolving credit facility with $294.0 million in aggregate commitments secured by certain fixed assets and intellectual property of the U.S. borrowers under the Credit Agreement, and certain equity interests in the borrower and guarantor subsidiaries under the Credit Agreement. Borrowings under the senior secured revolving credit facilities (i) are limited by jurisdiction-specific borrowing base calculations based on the sum of specified percentages of eligible accounts receivable, eligible inventory and certain fixed assets and intellectual property, as applicable, minus the amount of any applicable reserves, and (ii) bear interest at a floating rate, which can be either, at the Borrower's option, (a) an adjusted LIBOR rate plus an applicable margin ranging from 1.25% to 1.75% per annum or (b) an alternate base rate plus an applicable margin ranging from 0.25% to 0.75% per annum, in each case, such applicable margins to be determined based on the Borrower's average borrowing availability remaining under the senior secured revolving credit facilities. In addition to paying interest on the outstanding principal under the senior secured revolving credit facilities, the Borrower is required to pay (i) an unused line fee per annum of the average daily unused portion of the senior secured revolving credit facilities, (ii) a letter of credit fronting fee based on a percentage of the aggregate face amount of outstanding letters of credit, and (iii) certain other customary fees and expenses of the lenders and agents. Mattel had no borrowings under the senior secured revolving credit facilities as of March 31, 2021, $150.0 million of borrowings as of March 31, 2020, and no borrowings under the senior secured revolving credit facilities as of December 31, 2020. Outstanding letters of credit under the senior secured revolving credit facilities totaled approximately $11 million, $13 million, and $11 million as of March 31, 2021, March 31, 2020, and December 31, 2020, respectively. As of March 31, 2021, Mattel was in compliance with all covenants contained in the Credit Agreement. The Credit Agreement is a material agreement, and failure to comply with the covenants may result in an event of default under the terms of the senior secured revolving credit facilities. If Mattel were to default under the terms of the senior secured revolving credit facilities, its ability to meet its seasonal financing requirements could be adversely affected. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt includes the following: March 31, March 31, December 31, (In thousands) 2010 Senior Notes due October 2040 $ 250,000 $ 250,000 $ 250,000 2011 Senior Notes due November 2041 300,000 300,000 300,000 2013 Senior Notes due March 2023 250,000 250,000 250,000 2017/2018 Senior Notes due December 2025 275,000 1,500,000 1,500,000 2019 Senior Notes due December 2027 600,000 600,000 600,000 2021 Senior Notes due April 2026 600,000 — — 2021 Senior Notes due April 2029 600,000 — — Debt issuance costs and debt discount (37,268) (51,076) (45,336) $ 2,837,732 $ 2,848,924 $ 2,854,664 |
Other Noncurrent Liabilities
Other Noncurrent Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Other Noncurrent Liabilities | Other Noncurrent Liabilities Other noncurrent liabilities include the following: March 31, March 31, December 31, (In thousands) Benefit plan liabilities $ 221,345 $ 205,694 $ 225,957 Noncurrent income tax payable 72,252 70,902 71,342 Deferred income tax liability 60,929 54,896 60,892 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The following tables present changes in the accumulated balances for each component of other comprehensive income (loss), including other comprehensive income (loss) and reclassifications out of accumulated other comprehensive income (loss) for each period: For the Three Months Ended March 31, 2021 Derivative Available-for-Sale Security Employee Benefit Plans Currency Total (In thousands) Accumulated Other Comprehensive Loss, Net of Tax, as of December 31, 2020 $ (15,369) $ (7,522) $ (186,854) $ (734,831) $ (944,576) Other comprehensive income (loss) before reclassifications 4,057 1,964 (67) (28,133) (22,179) Amounts reclassified from accumulated other comprehensive loss 3,314 — 2,415 — 5,729 Net increase (decrease) in other comprehensive income (loss) 7,371 1,964 2,348 (28,133) (16,450) Accumulated Other Comprehensive Loss, Net of Tax, as of March 31, 2021 $ (7,998) $ (5,558) $ (184,506) $ (762,964) $ (961,026) For the Three Months Ended March 31, 2020 Derivative Available-for-Sale Security Employee Benefit Plans Currency Total (In thousands) Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2019 $ 11,041 $ (8,260) $ (169,857) $ (702,408) $ (869,484) Other comprehensive income (loss) before reclassifications 9,190 195 1,702 (145,634) (134,547) Amounts reclassified from accumulated other comprehensive loss (3,210) — 1,358 — (1,852) Net increase (decrease) in other comprehensive income (loss) 5,980 195 3,060 (145,634) (136,399) Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2020 $ 17,021 $ (8,065) $ (166,797) $ (848,042) $ (1,005,883) The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statements of operations: For the Three Months Ended March 31, March 31, Statements of Operations (In thousands) Derivative Instruments (Loss) gain on foreign currency forward exchange and other contracts $ (3,206) $ 3,193 Cost of sales Tax effect of net (loss) gain (108) 17 Provision for income taxes $ (3,314) $ 3,210 Net loss Employee Benefit Plans Amortization of prior service credit (a) $ 398 $ 466 Other non-operating income/expense, net Recognized actuarial loss (a) (2,783) (2,340) Other non-operating income/expense, net (2,385) (1,874) Tax effect of net (loss) gain (30) 516 Provision for income taxes $ (2,415) $ (1,358) Net loss _______________________________________ (a) The amortization of prior service credit and recognized actuarial loss are included in the computation of net periodic benefit cost. Refer to "Note 16 to the Consolidated Financial Statements—Employee Benefit Plans" of this Quarterly Report on Form 10-Q for additional information regarding Mattel's net periodic benefit cost. Currency Translation Adjustments |
Foreign Currency Transaction Ex
Foreign Currency Transaction Exposure | 3 Months Ended |
Mar. 31, 2021 | |
Foreign Currency [Abstract] | |
Foreign Currency Transaction Exposure | Foreign Currency Transaction Exposure Currency exchange rate fluctuations may impact Mattel's results of operations and cash flows. Mattel's currency transaction exposures include gains and losses realized on unhedged inventory purchases and unhedged receivables and payables balances that are denominated in a currency other than the applicable functional currency. Gains and losses on unhedged inventory purchases and other transactions associated with operating activities are recorded in the components of operating income (loss) in the consolidated statements of operations. Gains and losses on unhedged intercompany loans and advances are recorded as a component of other non-operating (income) expense, net in the consolidated statements of operations in the period in which the currency exchange rate changes. Inventory transactions denominated in the Euro, Mexican peso, Australian dollar, British pound sterling, Canadian dollar, Russian ruble, and Brazilian real were the primary transactions that caused foreign currency transaction exposure for Mattel during the three months ended March 31, 2021. Currency transaction gains (losses) included in the consolidated statements of operations are as follows: For the Three Months Ended March 31, March 31, Statements of Operations Classification (In thousands) Currency transaction (losses) gains $ (13,791) $ 224 Operating income/loss Currency transaction (losses) (3,308) (832) Other non-operating income/expense, net Currency transaction (losses), net $ (17,099) $ (608) |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative InstrumentsMattel seeks to mitigate its exposure to foreign currency transaction risk by monitoring its foreign currency transaction exposure for the year and partially hedging such exposure using foreign currency forward exchange contracts. Mattel uses foreign currency forward exchange contracts as cash flow hedges primarily to hedge its purchases and sales of inventory denominated in foreign currencies. These contracts generally have maturity dates of up to 18 months. These derivative instruments have been designated as effective cash flow hedges, whereby the unsettled hedges are reported in Mattel's consolidated balance sheets at fair value, with changes in the fair value of the hedges reflected in other comprehensive income (loss) ("OCI"). Realized gains and losses for these contracts are recorded in the consolidated statements of operations in the period in which the inventory is sold to customers. Mattel uses foreign currency forward exchange contracts to hedge intercompany loans and advances denominated in foreign currencies. Due to the short-term nature of the contracts involved, Mattel does not use hedge accounting for these contracts, and as such, changes in fair value are recorded in the period of change in the consolidated statements of operations. Mattel utilizes derivative contracts to hedge certain purchases of commodities, which were not material. As of March 31, 2021, March 31, 2020, and December 31, 2020, Mattel held foreign currency forward exchange contracts and other commodity derivative instruments, with notional amounts of $951.5 million, $1.37 billion, and $855.0 million, respectively. The following tables present Mattel's derivative assets and liabilities: Derivative Assets Balance Sheet Classification Fair Value March 31, March 31, December 31, (In thousands) Derivatives designated as hedging instruments Foreign currency forward exchange and other contracts Prepaid expenses and other current assets $ 4,534 $ 21,121 $ 3,641 Foreign currency forward exchange and other contracts Other noncurrent assets 1,250 2,525 50 Total derivatives designated as hedging instruments $ 5,784 $ 23,646 $ 3,691 Derivatives not designated as hedging instruments Foreign currency forward exchange and other contracts Prepaid expenses and other current assets $ 2,050 $ 13,811 $ 1,982 Foreign currency forward exchange and other contracts Other noncurrent assets — — 38 Total derivatives not designated as hedging instruments $ 2,050 $ 13,811 $ 2,020 $ 7,834 $ 37,457 $ 5,711 Derivative Liabilities Balance Sheet Classification Fair Value March 31, March 31, December 31, (In thousands) Derivatives designated as hedging instruments Foreign currency forward exchange and other contracts Accrued liabilities $ 11,009 $ 6,841 $ 20,330 Foreign currency forward exchange and other contracts Other noncurrent liabilities 808 2,507 4,361 Total derivatives designated as hedging instruments $ 11,817 $ 9,348 $ 24,691 Derivatives not designated as hedging instruments Foreign currency forward exchange and other contracts Accrued liabilities $ 5,487 $ 1,594 $ 803 Foreign currency forward exchange and other contracts Other noncurrent liabilities — 224 — Total derivatives not designated as hedging instruments $ 5,487 $ 1,818 $ 803 $ 17,304 $ 11,166 $ 25,494 The following tables present the classification and amount of gains and losses, net of tax, from derivatives reported in the consolidated statements of operations: Derivatives Designated As Hedging Instruments For the Three Months Ended March 31, 2021 March 31, 2020 Statements of Operations Classification (In thousands) Foreign currency forward exchange contracts: Amount of gains recognized in OCI $ 4,057 $ 9,190 Amount of (losses) gains reclassified from accumulated OCI to consolidated statements of operations (3,314) 3,210 Cost of sales The net (losses) gains reclassified from accumulated other comprehensive loss to the consolidated statements of operations during the three months ended March 31, 2021 and 2020, respectively, were offset by the changes in cash flows associated with the underlying hedged transactions. Derivatives Not Designated As Hedging Instruments For the Three Months Ended March 31, 2021 March 31, 2020 Statements of Operations Classification (In thousands) Amount of net loss recognized in the Statements of Operations Foreign currency forward exchange and other contract (losses) $ (8,636) $ (38,369) Other non-operating income/expense, net Foreign currency forward exchange and other contract gains 639 — Cost of sales $ (7,997) $ (38,369) The net losses recognized in the consolidated statements of operations during the three months ended March 31, 2021 and 2020, respectively, were offset by foreign currency transaction gains and losses on the related hedged balances. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following tables present information about Mattel's assets and liabilities measured and reported in the financial statements at fair value on a recurring basis as of March 31, 2021, March 31, 2020, and December 31, 2020 and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value. The three levels of the fair value hierarchy are as follows: • Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access. • Level 2 – Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities, either directly or indirectly. • Level 3 – Valuations based on inputs that are unobservable, supported by little or no market activity, and that are significant to the fair value of the assets or liabilities. Mattel's financial assets and liabilities include the following: March 31, 2021 Level 1 Level 2 Level 3 Total (In thousands) Assets: Foreign currency forward exchange contracts and other (a) $ — $ 7,834 $ — $ 7,834 Available-for-sale (b) 6,232 — — 6,232 Total assets $ 6,232 $ 7,834 $ — $ 14,066 Liabilities: Foreign currency forward exchange contracts and other (a) $ — $ 17,304 $ — $ 17,304 March 31, 2020 Level 1 Level 2 Level 3 Total (In thousands) Assets: Foreign currency forward exchange contracts and other (a) $ — $ 37,457 $ — $ 37,457 Available-for-sale (b) 3,725 — — 3,725 Total assets $ 3,725 $ 37,457 $ — $ 41,182 Liabilities: Foreign currency forward exchange contracts and other (a) $ — $ 11,166 $ — $ 11,166 December 31, 2020 Level 1 Level 2 Level 3 Total (In thousands) Assets: Foreign currency forward exchange contracts and other (a) $ — $ 5,711 $ — $ 5,711 Available-for-sale (b) 4,268 — — 4,268 Total assets $ 4,268 $ 5,711 $ — $ 9,979 Liabilities: Foreign currency forward exchange contracts and other (a) $ — $ 25,494 $ — $ 25,494 ____________________________________________ (a) The fair value of the foreign currency forward exchange contracts and other commodity derivative instruments is based on dealer quotes of market forward rates and reflects the amount that Mattel would receive or pay at their maturity dates for contracts involving the same notional amounts, currencies, and maturity dates. (b) The fair value of the available-for-sale security is based on the quoted price on an active public exchange. Other Financial Instruments Mattel's financial instruments include cash and equivalents, accounts receivable and payable, accrued liabilities, short-term borrowings, and long-term debt. The fair values of these instruments, excluding long-term debt, approximate their carrying values because of their short-term nature. Cash and equivalents are classified as Level 1 and all other financial instruments are classified as Level 2 within the fair value hierarchy. The estimated fair value of Mattel's long-term debt was $3.05 billion (compared to a carrying value of $2.88 billion) as of March 31, 2021, $2.77 billion (compared to a carrying value of $2.90 billion) as of March 31, 2020, and $3.11 billion (compared to a carrying value of $2.90 billion) as of December 31, 2020. The estimated fair values have been calculated based on broker quotes or rates for the same or similar instruments and are classified as Level 2 within the fair value hierarchy. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table reconciles basic and diluted earnings per common share for the three months ended March 31, 2021 and 2020: For the Three Months Ended March 31, March 31, (In thousands, except per share amounts) Basic: Net loss $ (115,218) $ (210,741) Weighted-average number of common shares 349,041 346,867 Basic net loss per common share $ (0.33) $ (0.61) Diluted: Net loss $ (115,218) $ (210,741) Weighted-average number of common shares 349,041 346,867 Dilutive stock options and restricted stock units ("RSUs") (a) — — Weighted-average number of common and potential common shares 349,041 346,867 Diluted net loss per common share $ (0.33) $ (0.61) _______________________________________ (a) Mattel was in a net loss position for the three months ended March 31, 2021 and 2020, and, accordingly, all outstanding nonqualified stock options and RSUs were excluded from the calculation of diluted net loss per common share because their effect would be antidilutive. |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2021 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Mattel and certain of its subsidiaries have qualified and nonqualified retirement plans covering substantially all employees of these companies, which are more fully described in Part II, Item 8 "Financial Statements and Supplementary Data—Note 4 to the Consolidated Financial Statements–Employee Benefit Plans" in the 2020 Annual Report on Form 10-K. A summary of the components of net periodic benefit cost for Mattel's defined benefit pension plans is as follows: For the Three Months Ended March 31, March 31, (In thousands) Service cost $ 1,293 $ 1,109 Interest cost 2,540 3,781 Expected return on plan assets (4,627) (4,921) Amortization of prior service cost 111 43 Recognized actuarial loss 2,785 2,359 $ 2,102 $ 2,371 A summary of the components of net periodic benefit cost for Mattel's postretirement benefit plans is as follows: For the Three Months Ended March 31, March 31, (In thousands) Interest cost $ 19 $ 35 Amortization of prior service credit (509) (509) Recognized actuarial gain (2) (19) $ (492) $ (493) |
Share-Based Payments
Share-Based Payments | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Payments | Share-Based Payments Mattel has various stock compensation plans, which are more fully described in Part II, Item 8 "Financial Statements and Supplementary Data—Note 8 to the Consolidated Financial Statements—Share-Based Payments" in the 2020 Annual Report on Form 10-K. Under the Mattel, Inc. Amended and Restated 2010 Equity and Long-Term Compensation Plan, Mattel has the ability to grant nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, RSUs, performance awards, dividend equivalent rights, and shares of common stock to officers, employees, and other persons providing services to Mattel. Stock options are granted with exercise prices at the fair market value of Mattel's common stock on the applicable grant date and expire no later than ten years from the date of grant. Stock options, RSUs, and performance awards generally provide for vesting over, or at the end of, a period of three years from the date of grant. As of March 31, 2021, three long-term incentive programs were in place with the following performance cycles: (i) a January 1, 2019–December 31, 2021 performance cycle, (ii) a January 1, 2020–December 31, 2022 performance cycle, and (iii) a January 1, 2021–December 31, 2023 performance cycle. Compensation expense, included within other selling and administrative expenses in the consolidated statements of operations, related to stock options, RSUs, and performance awards is as follows: For the Three Months Ended March 31, March 31, (In thousands) Stock option compensation expense $ 2,783 $ 3,131 RSU compensation expense 6,357 7,361 Performance award compensation expense 5,972 3,783 $ 15,112 $ 14,275 As of March 31, 2021, total unrecognized compensation expense related to unvested share-based payments totaled $79.0 million and is expected to be recognized over a weighted-average period of 2.0 years. Mattel uses treasury shares purchased under its share repurchase program to satisfy stock option exercises and the vesting of RSUs and performance awards. For the three months ended March 31, 2021, cash received for stock option exercises was $1.3 million. For the three months ended March 31, 2020, no cash was received for stock option exercises. |
Other Selling and Administrativ
Other Selling and Administrative Expenses | 3 Months Ended |
Mar. 31, 2021 | |
Other Income and Expenses [Abstract] | |
Other Selling and Administrative Expenses | Other Selling and Administrative Expenses Other selling and administrative expenses include the following: For the Three Months Ended March 31, March 31, (In thousands) Design and development $ 43,981 $ 44,628 Identifiable intangible asset amortization 9,514 9,965 |
Restructuring Charges
Restructuring Charges | 3 Months Ended |
Mar. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Restructuring Charges Optimizing for Growth (formerly Capital Light) On February 9, 2021, Mattel announced the Optimizing for Growth program, a multi-year cost savings program which integrates and expands upon the previously announced Capital Light program (the "Program"). In connection with the Program, Mattel recorded severance and other restructuring costs in the following cost and expense categories within the consolidated statements of operations: For the Three Months Ended March 31, March 31, (In thousands) Cost of sales (a) $ 1,932 $ 3,057 Other selling and administrative expenses (b) 5,710 2,746 $ 7,642 $ 5,803 _______________________________________ (a) Severance and other restructuring costs recorded within cost of sales in the consolidated statements of operations include charges associated with the consolidation of manufacturing facilities. (b) Severance and other restructuring costs recorded within other selling and administrative expenses in the consolidated statements of operations are included in corporate and other expense in "Note 22 to the Consolidated Financial Statements—Segment Information." The following table summarizes Mattel's severance and other restructuring charges activity related to the Program for the three months ended March 31, 2021: Liability at December 31, 2020 Charges (a) Payments/Utilization Liability at March 31, 2021 (In thousands) Severance $ 5,294 $ 4,342 $ (1,405) $ 8,231 Other restructuring charges 30 3,300 (3,071) 259 $ 5,324 $ 7,642 $ (4,476) $ 8,490 _______________________________________ (a) Other restructuring charges consist primarily of charges associated with the consolidation of manufacturing facilities. As of March 31, 2021, Mattel has recorded cumulative severance and other restructuring charges related to the Program of approximately $58 million, which include approximately $17 million of non-cash charges. Furthermore, cumulatively, in conjunction with previous actions taken under the Program, total expected cash expenditures are approximately $140 to $165 million and total non-cash charges are $40 to $45 million. During the three months ended March 31, 2021, in conjunction with the Program, Mattel completed the sale of a manufacturing plant based in Mexico, which included land and buildings, resulting in a pre-tax gain of $15.8 million. Other Cost Savings Actions During the three months ended March 31, 2020, Mattel recorded severance charges of approximately $5 million, primarily related to actions taken to further streamline its organizational structure. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Mattel's provision for income taxes was $20.3 million and $11.9 million for the three months ended March 31, 2021 and 2020, respectively. During the three months ended March 31, 2021, Mattel recognized a net discrete tax expense of $7.3 million, primarily related to income taxes recorded on a discrete basis in various jurisdictions and an expense for reassessments of prior year's tax liabilities. During the three months ended March 31, 2020, Mattel recognized a net discrete tax expense of $6.4 million primarily related to an expense for reassessments of prior years' tax liabilities and income taxes recorded on a discrete basis in various jurisdictions. As a result of the establishment of a valuation allowance on U.S. deferred tax assets in 2017, there was no U.S. tax benefit provided for U.S. losses during the three months ended March 31, 2021 and 2020. Evaluating the need for and the amount of a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence to determine whether it is more-likely-than-not that these assets will be realized. Mattel maintains a valuation allowance on its deferred tax assets until there is sufficient evidence to support the release of all or some portion of these allowances. Release of the valuation allowance would result in the recognition of a portion of these deferred tax assets and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount, if any, of the valuation allowance release are subject to change depending on the level of earnings that Mattel is able to achieve in the tax jurisdictions in which a valuation allowance has been recorded. In the normal course of business, Mattel is regularly audited by federal, state, and foreign tax authorities. Based on the current status of federal, state, and foreign audits, Mattel believes it is reasonably possible that in the next twelve months, the total unrecognized tax benefits could decrease by approximately $31.6 million related to the settlement of tax audits and/or the expiration of statutes of limitations. The ultimate settlement of any particular issue with the applicable taxing authority could have a material impact on Mattel's consolidated financial statements. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Litigation Related to Yellowstone do Brasil Ltda. Yellowstone do Brasil Ltda. (formerly known as Trebbor Informática Ltda.) was a customer of Mattel's subsidiary Mattel do Brasil Ltda. when a commercial dispute arose between Yellowstone and Mattel do Brasil regarding the supply of product and related payment terms. As a consequence of the dispute, in April 1999, Yellowstone filed a declarative action against Mattel do Brasil before the 15 th Civil Court of Curitiba – State of Parana (the "Trial Court"), requesting the annulment of its security bonds and promissory notes given to Mattel do Brasil as well as requesting the Trial Court to find Mattel do Brasil liable for damages incurred as a result of Mattel do Brasil’s alleged abrupt and unreasonable breach of an oral exclusive distribution agreement between the parties relating to the supply and sale of toys in Brazil. Yellowstone's complaint sought alleged loss of profits of approximately $1 million, plus an unspecified amount of damages consisting of: (i) compensation for all investments made by Yellowstone to develop Mattel do Brasil's business; (ii) reimbursement of the amounts paid by Yellowstone to terminate labor and civil contracts in connection with the business; (iii) compensation for alleged unfair competition and for the goodwill of trade; and (iv) compensation for non-pecuniary damages. Mattel do Brasil filed its defenses to these claims and simultaneously presented a counterclaim for unpaid accounts receivable for goods supplied to Yellowstone in the approximate amount of $4 million. During the evidentiary phase a first accounting report was submitted by a court-appointed expert. Such report stated that Yellowstone had invested approximately $3 million in its business. Additionally, the court-appointed expert calculated a loss of profits compensation of approximately $1 million. Mattel do Brasil challenged the report since it was not made based on the official accounting documents of Yellowstone and since the report calculated damages based only on documents unilaterally submitted by Yellowstone. The Trial Court accepted the challenge and ruled that a second accounting examination should take place in the lawsuit. Yellowstone appealed the decision to the Court of Appeals of the State of Parana (the "Appeals Court"), but it was upheld by the Appeals Court. The second court-appointed expert’s report submitted at trial did not assign a value to any of Yellowstone’s claims and found no evidence of causation between Mattel do Brasil's actions and such claims. In January 2010, the Trial Court ruled in favor of Mattel do Brasil and denied all of Yellowstone’s claims based primarily on the lack of any causal connection between the acts of Mattel do Brasil and Yellowstone’s alleged damages. Additionally, the Trial Court upheld Mattel do Brasil's counterclaim and ordered Yellowstone to pay Mattel do Brasil approximately $4 million. The likelihood of Mattel do Brasil recovering this amount was uncertain due to the fact that Yellowstone was declared insolvent and filed for bankruptcy protection. In February 2010, Yellowstone filed a motion seeking clarification of the decision which was denied. In September 2010, Yellowstone filed a further appeal with the Appeals Court. Under Brazilian law, the appeal was de novo and Yellowstone restated all of the arguments it made at the Trial Court level. Yellowstone did not provide any additional information supporting its unspecified alleged damages. The Appeals Court held hearings on the appeal in March and April 2013. On July 26, 2013, the Appeals Court awarded Yellowstone approximately $17 million in damages, plus attorney's fees, as adjusted for inflation and interest. The Appeals Court also awarded Mattel do Brasil approximately $7.5 million on its counterclaim, as adjusted for inflation. On August 2, 2013, Mattel do Brasil filed a motion with the Appeals Court for clarification since the written decision contained clear errors in terms of amounts awarded and interest and inflation adjustments. Mattel do Brasil's motion also asked the Appeals Court to decide whether Yellowstone’s award could be offset by the counterclaim award, despite Yellowstone's status as a bankrupt entity. Yellowstone also filed a motion for clarification on August 5, 2013. A decision on the clarification motions was rendered on November 11, 2014, and the Appeals Court accepted partially the arguments raised by Mattel do Brasil. As a result, the Appeals Court awarded Yellowstone approximately $14.5 million in damages, as adjusted for inflation and interest, plus attorney's fees. The Appeals Court also awarded Mattel do Brasil approximately $7.5 million on its counterclaim, as adjusted for inflation. The decision also recognized the existence of legal rules that support Mattel do Brasil's right to offset its counterclaim award of approximately $7.5 million. Mattel do Brasil filed a new motion for clarification with the Appeals Court on January 21, 2015, due to the incorrect statement made by the reporting judge of the Appeals Court, that the court-appointed expert analyzed the "accounting documents" of Yellowstone. On April 26, 2015, a decision on the motion for clarification was rendered. The Appeals Court ruled that the motion for clarification was denied and imposed a fine on Mattel do Brasil equal to 1% of the value of the claims made for the delay caused by the motion. On July 3, 2015, Mattel do Brasil filed a special appeal to the Superior Court of Justice based upon both procedural and substantive grounds. This special appeal sought to reverse the Appeals Court's decision of July 26, 2013, and to reverse the fine as inappropriate under the law. This special appeal was submitted to the Appeals Court. Yellowstone also filed a special appeal with the Appeals Court in February 2015, which was made available to Mattel do Brasil on October 7, 2015. Yellowstone's special appeal sought to reverse the Appeals Court decision with respect to: (a) the limitation on Yellowstone's loss of profits claim to the amount requested in the complaint, instead of the amount contained in the first court-appointed experts report, and (b) the award of damages to Mattel do Brasil on the counterclaim, since the specific amount was not requested in Mattel do Brasil's counterclaim brief. On October 19, 2015, Mattel do Brasil filed its answer to the special appeal filed by Yellowstone and Yellowstone filed its answer to the special appeal filed by Mattel do Brasil. On April 4, 2016, the Appeals Court rendered a decision denying the admissibility of Mattel's and Yellowstone's special appeals. On May 11, 2016, both Mattel and Yellowstone filed interlocutory appeals. On August 31, 2017, the reporting justice for the Appeals Court denied Yellowstone’s interlocutory appeal. As to Mattel, the reporting justice reversed the fine referenced above that had been previously imposed on Mattel for filing a motion for clarification. However, the reporting justice rejected Mattel’s arguments on the merits of Yellowstone’s damages claims. On September 22, 2017, Mattel filed a further appeal to the full panel of five appellate justices to challenge the merits of Yellowstone's damages claims. Yellowstone did not file a further appeal. In April 2018, Mattel do Brasil entered into a settlement agreement to resolve this matter, but the settlement was later rejected by the courts, subject to a pending appeal by Mattel. On October 2, 2018, the Appeals Court rejected Mattel's merits appeal, and affirmed the prior rulings in favor of Yellowstone. In October 2019, Mattel reached an agreement with Yellowstone's former counsel regarding payment of the attorney's fees portion of the judgment. In November 2019, Yellowstone initiated an action to enforce its judgment against Mattel, but did not account for an offset for Mattel's counterclaim. On January 27, 2020, Mattel obtained an injunction, staying Yellowstone's enforcement action pending resolution of Mattel's appeal to enforce the parties' April 2018 settlement. As of March 31, 2021, Mattel assessed its probable loss related to the Yellowstone matter and has accrued a reserve, which was not material. Litigation Related to the Fisher-Price Rock 'n Play Sleeper A number of putative class action lawsuits are pending against Fisher-Price, Inc. and/or Mattel, Inc. asserting claims for false advertising, negligent product design, breach of warranty, fraud, and other claims in connection with the marketing and sale of the Fisher-Price Rock 'n Play Sleeper (the "Sleeper"). In general, the lawsuits allege that the Sleeper should not have been marketed and sold as safe and fit for prolonged and overnight sleep for infants. The putative class action lawsuits propose nationwide and over 15 statewide consumer classes comprised of those who purchased the Sleeper as marketed as safe for prolonged and overnight sleep. The class actions have been consolidated before a single judge for pre-trial purposes pursuant to the federal courts’ Multi-District Litigation program. Forty-nine additional lawsuits are pending against Fisher-Price, Inc. and Mattel, Inc. alleging that a product defect in the Sleeper caused the fatalities of or injuries to fifty-three children. Additionally, Fisher-Price, Inc. and/or Mattel, Inc. have also received letters from lawyers purporting to represent additional plaintiffs who are threatening to assert similar claims. In addition, a stockholder has filed a derivative action in the Court of Chancery for the State of Delaware (Kumar v. Bradley, et al., filed July 7, 2020) alleging breach of fiduciary duty and unjust enrichment related to the development, marketing, and sale of the Sleeper. The defendants in the derivative action are certain of Mattel's current and former officers and directors. In August 2020, the derivative action was stayed pending further developments in the class action lawsuits. The lawsuits seek compensatory damages, punitive damages, statutory damages, restitution, disgorgement, attorneys’ fees, costs, interest, declaratory relief, and/or injunctive relief. Mattel believes that the allegations in the lawsuits are without merit and intends to vigorously defend against them. A reasonable estimate of the amount of any possible loss or range of loss cannot be made at this time. Litigation and Investigations Related to Whistleblower Letter In December 2019 and January 2020, two stockholders filed separate complaints styled as class actions against Mattel, Inc., and certain of its current and former officers, alleging violations of federal securities laws. The complaints rely on the results of an investigation announced by Mattel in October 2019 regarding allegations in a whistleblower letter and claim that Mattel misled the market in several of its financial statements beginning in the third quarter of 2017. The lawsuits allege that the defendants' conduct caused the plaintiff and other stockholders to purchase Mattel common stock at artificially inflated prices. In addition, a stockholder has filed a derivative action in the United States District Court for the District of Delaware (Moher v. Kreiz, et al., filed April 9, 2020) making allegations that are substantially identical to, or are based upon, the allegations of the class action lawsuits. The defendants in the derivative action are certain of Mattel's current and former officers and directors, Mattel, Inc., and PricewaterhouseCoopers LLP. Subsequently, a nearly identical derivative action was filed by a different stockholder against the same defendants. The second lawsuit is styled as an amended complaint and replaces a complaint making unrelated allegations in a previously filed lawsuit already pending in Delaware federal court (Lombardi v. Kreiz, et al., amended complaint filed April 16, 2020). In May 2020, the derivative actions were consolidated and stayed pending further developments in the class action lawsuits. The lawsuits seek unspecified compensatory damages, attorneys' fees, expert fees, costs and/or injunctive relief. Mattel believes that the allegations in the lawsuits are without merit and intends to vigorously defend against them. A reasonable estimate of the amount of any possible loss or range of loss cannot be made at this time. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Mattel designs, manufactures, and markets a broad variety of toy products worldwide, which are sold to its customers and directly to consumers. Segment Data Mattel's operating segments are: (i) North America, which consists of the U.S. and Canada; (ii) International; and (iii) American Girl. The North America and International segments sell products across categories, although some products are developed and adapted for particular international markets. The following tables present information regarding net sales, operating income (loss), and assets by segment. The corporate and other expense category includes operating costs not allocated to individual segments, including charges related to incentive and share-based compensation, corporate headquarters functions managed on a worldwide basis, the impact of changes in foreign currency exchange rates on intercompany transactions, and certain severance and other restructuring costs. Effective as of the first quarter of 2021, operating income by segment reviewed by the Chief Operating Decision Maker does not include certain corporate expenses which were historically allocated by segment. The prior period presentation of operating income by segment has been conformed to the current period's presentation. It is impracticable for Mattel to present net sales by categories, brands, or products, as trade discounts and other allowances are generally recorded in the financial accounting systems by customer. For the Three Months Ended March 31, March 31, (In thousands) Net Sales by Segment North America $ 479,660 $ 287,553 International 349,354 269,356 American Girl 45,178 37,160 Net sales $ 874,192 $ 594,069 For the Three Months Ended March 31, March 31, (In thousands) Operating Income (Loss) by Segment North America (a) $ 123,374 $ 13,985 International (a) 35,170 (28,861) American Girl (9,831) (17,441) 148,713 (32,317) Corporate and other expense (b) (117,675) (117,493) Operating income (loss) 31,038 (149,810) Interest expense 130,482 48,980 Interest (income) (820) (2,084) Other non-operating (income) expense, net (1,086) 3,023 Loss before income taxes $ (97,538) $ (199,729) _______________________________________ (a) Operating income (loss) included severance and restructuring expenses of $1.9 million and $3.1 million, for the three months ended March 31, 2021, and 2020, respectively, which were allocated to the North America and International segments. (b) Corporate and other expense included severance and restructuring charges of $5.7 million and $7.5 million, for the three months ended March 31, 2021, and 2020, respectively. Corporate and other expense also included expenses related to inclined sleeper product recall litigation of $5.3 million and $6.3 million for the three months ended March 31, 2021 and 2020, respectively, and incentive and share-based compensation for all periods presented. Segment assets are comprised of accounts receivable and inventories, net of applicable allowances and reserves. March 31, March 31, December 31, (In thousands) Assets by Segment North America $ 585,221 $ 480,738 $ 664,696 International 520,717 455,918 713,650 American Girl 46,956 36,427 40,290 1,152,894 973,083 1,418,636 Corporate and other 137,583 116,084 130,003 Accounts receivable and inventories, net $ 1,290,477 $ 1,089,167 $ 1,548,639 Geographic Information The table below presents information by geographic area. Net sales are attributed to countries based on location of the customer. For the Three Months Ended March 31, March 31, (In thousands) Net Sales by Geographic Area North America $ 524,838 $ 324,713 International EMEA 238,169 173,323 Latin America 56,278 51,275 Asia Pacific 54,907 44,758 Total International 349,354 269,356 Net sales $ 874,192 $ 594,069 |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which simplifies the accounting for incomes taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify the accounting for other areas of Topic 740 by clarifying and amending existing guidance. The amendments related to changes in ownership of foreign equity method investments or foreign subsidiaries are applied on a modified retrospective basis through a cumulative effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. The amendments related to franchise taxes that are partially based on income are applied on either a retrospective basis for all periods presented or a modified retrospective basis through a cumulative effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. All other amendments are applied on a prospective basis. Mattel adopted ASU 2019-12 on January 1, 2021. The adoption of this new accounting standard did not have a material impact on Mattel's consolidated financial statements. Accounting Pronouncements Not Yet Adopted In March 2020 and January 2021, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU 2021-01, Reference Rate Reform (Topic 848): Scope, respectively. ASU 2020-04 and ASU 2021-01 provide optional expedients and exceptions for applying U.S. GAAP, to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform, if certain criteria are met. The guidance in ASU 2020- 04 and ASU 2021-01 was effective upon issuance and, once adopted, may be applied prospectively to contract modifications and hedging relationships through December 31, 2022. Mattel is currently evaluating the impact of the adoption of ASU 2020-04 and ASU 2021-01 on its consolidated financial statements. |
New Accounting Pronouncements (
New Accounting Pronouncements (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Basis of Presentation | The accompanying unaudited consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair statement of the financial position and interim results of Mattel, Inc. and its subsidiaries ("Mattel") as of and for the periods presented have been included. |
Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which simplifies the accounting for incomes taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify the accounting for other areas of Topic 740 by clarifying and amending existing guidance. The amendments related to changes in ownership of foreign equity method investments or foreign subsidiaries are applied on a modified retrospective basis through a cumulative effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. The amendments related to franchise taxes that are partially based on income are applied on either a retrospective basis for all periods presented or a modified retrospective basis through a cumulative effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. All other amendments are applied on a prospective basis. Mattel adopted ASU 2019-12 on January 1, 2021. The adoption of this new accounting standard did not have a material impact on Mattel's consolidated financial statements. Accounting Pronouncements Not Yet Adopted In March 2020 and January 2021, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU 2021-01, Reference Rate Reform (Topic 848): Scope, respectively. ASU 2020-04 and ASU 2021-01 provide optional expedients and exceptions for applying U.S. GAAP, to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform, if certain criteria are met. The guidance in ASU 2020- 04 and ASU 2021-01 was effective upon issuance and, once adopted, may be applied prospectively to contract modifications and hedging relationships through December 31, 2022. Mattel is currently evaluating the impact of the adoption of ASU 2020-04 and ASU 2021-01 on its consolidated financial statements. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories include the following: March 31, March 31, December 31, (In thousands) Raw materials and work in process $ 119,417 $ 107,880 $ 110,010 Finished goods 490,418 452,765 404,663 $ 609,835 $ 560,645 $ 514,673 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant, and Equipment | Property, plant, and equipment, net includes the following: March 31, March 31, December 31, (In thousands) Land $ 22,029 $ 24,856 $ 24,913 Buildings 312,114 297,910 335,407 Machinery and equipment 764,276 769,761 772,349 Software 345,477 367,143 344,268 Tools, dies, and molds 603,817 719,615 607,915 Leasehold improvements 119,828 179,872 131,578 2,167,541 2,359,157 2,216,430 Less: accumulated depreciation (1,716,540) (1,839,380) (1,742,636) $ 451,001 $ 519,777 $ 473,794 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | December 31, Dispositions Currency March 31, (In thousands) North America $ 733,401 $ (1,290) $ 259 $ 732,370 International 452,862 (1,056) 542 452,348 American Girl 207,571 — — 207,571 $ 1,393,834 $ (2,346) $ 801 $ 1,392,289 |
Other Noncurrent Assets (Tables
Other Noncurrent Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Noncurrent Assets | Other noncurrent assets include the following: March 31, March 31, December 31, (In thousands) Identifiable intangible assets (net of accumulated amortization of $296.4 million, $258.0 million, and $286.9 million, respectively) $ 509,844 $ 534,044 $ 518,190 Deferred income taxes 71,157 62,674 72,682 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities include the following: March 31, March 31, December 31, (In thousands) Incentive compensation $ 143,414 $ 135,833 $ 126,601 Advertising and promotion 78,755 71,563 163,181 Current lease liabilities 73,155 78,247 79,540 Royalties 24,191 22,701 54,442 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt includes the following: March 31, March 31, December 31, (In thousands) 2010 Senior Notes due October 2040 $ 250,000 $ 250,000 $ 250,000 2011 Senior Notes due November 2041 300,000 300,000 300,000 2013 Senior Notes due March 2023 250,000 250,000 250,000 2017/2018 Senior Notes due December 2025 275,000 1,500,000 1,500,000 2019 Senior Notes due December 2027 600,000 600,000 600,000 2021 Senior Notes due April 2026 600,000 — — 2021 Senior Notes due April 2029 600,000 — — Debt issuance costs and debt discount (37,268) (51,076) (45,336) $ 2,837,732 $ 2,848,924 $ 2,854,664 |
Other Noncurrent Liabilities (T
Other Noncurrent Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Other Noncurrent Liabilities | Other noncurrent liabilities include the following: March 31, March 31, December 31, (In thousands) Benefit plan liabilities $ 221,345 $ 205,694 $ 225,957 Noncurrent income tax payable 72,252 70,902 71,342 Deferred income tax liability 60,929 54,896 60,892 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) | The following tables present changes in the accumulated balances for each component of other comprehensive income (loss), including other comprehensive income (loss) and reclassifications out of accumulated other comprehensive income (loss) for each period: For the Three Months Ended March 31, 2021 Derivative Available-for-Sale Security Employee Benefit Plans Currency Total (In thousands) Accumulated Other Comprehensive Loss, Net of Tax, as of December 31, 2020 $ (15,369) $ (7,522) $ (186,854) $ (734,831) $ (944,576) Other comprehensive income (loss) before reclassifications 4,057 1,964 (67) (28,133) (22,179) Amounts reclassified from accumulated other comprehensive loss 3,314 — 2,415 — 5,729 Net increase (decrease) in other comprehensive income (loss) 7,371 1,964 2,348 (28,133) (16,450) Accumulated Other Comprehensive Loss, Net of Tax, as of March 31, 2021 $ (7,998) $ (5,558) $ (184,506) $ (762,964) $ (961,026) For the Three Months Ended March 31, 2020 Derivative Available-for-Sale Security Employee Benefit Plans Currency Total (In thousands) Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2019 $ 11,041 $ (8,260) $ (169,857) $ (702,408) $ (869,484) Other comprehensive income (loss) before reclassifications 9,190 195 1,702 (145,634) (134,547) Amounts reclassified from accumulated other comprehensive loss (3,210) — 1,358 — (1,852) Net increase (decrease) in other comprehensive income (loss) 5,980 195 3,060 (145,634) (136,399) Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2020 $ 17,021 $ (8,065) $ (166,797) $ (848,042) $ (1,005,883) |
Schedule of Consolidated Statement of Operations Line Items Affected by Reclassifications from Accumulated Other Comprehensive Income (Loss) | The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statements of operations: For the Three Months Ended March 31, March 31, Statements of Operations (In thousands) Derivative Instruments (Loss) gain on foreign currency forward exchange and other contracts $ (3,206) $ 3,193 Cost of sales Tax effect of net (loss) gain (108) 17 Provision for income taxes $ (3,314) $ 3,210 Net loss Employee Benefit Plans Amortization of prior service credit (a) $ 398 $ 466 Other non-operating income/expense, net Recognized actuarial loss (a) (2,783) (2,340) Other non-operating income/expense, net (2,385) (1,874) Tax effect of net (loss) gain (30) 516 Provision for income taxes $ (2,415) $ (1,358) Net loss _______________________________________ (a) The amortization of prior service credit and recognized actuarial loss are included in the computation of net periodic benefit cost. Refer to "Note 16 to the Consolidated Financial Statements—Employee Benefit Plans" of this Quarterly Report on Form 10-Q for additional information regarding Mattel's net periodic benefit cost. |
Foreign Currency Transaction _2
Foreign Currency Transaction Exposure (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Foreign Currency [Abstract] | |
Schedule of Currency Transaction Exposure | Currency transaction gains (losses) included in the consolidated statements of operations are as follows: For the Three Months Ended March 31, March 31, Statements of Operations Classification (In thousands) Currency transaction (losses) gains $ (13,791) $ 224 Operating income/loss Currency transaction (losses) (3,308) (832) Other non-operating income/expense, net Currency transaction (losses), net $ (17,099) $ (608) |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Assets and Liabilities | The following tables present Mattel's derivative assets and liabilities: Derivative Assets Balance Sheet Classification Fair Value March 31, March 31, December 31, (In thousands) Derivatives designated as hedging instruments Foreign currency forward exchange and other contracts Prepaid expenses and other current assets $ 4,534 $ 21,121 $ 3,641 Foreign currency forward exchange and other contracts Other noncurrent assets 1,250 2,525 50 Total derivatives designated as hedging instruments $ 5,784 $ 23,646 $ 3,691 Derivatives not designated as hedging instruments Foreign currency forward exchange and other contracts Prepaid expenses and other current assets $ 2,050 $ 13,811 $ 1,982 Foreign currency forward exchange and other contracts Other noncurrent assets — — 38 Total derivatives not designated as hedging instruments $ 2,050 $ 13,811 $ 2,020 $ 7,834 $ 37,457 $ 5,711 Derivative Liabilities Balance Sheet Classification Fair Value March 31, March 31, December 31, (In thousands) Derivatives designated as hedging instruments Foreign currency forward exchange and other contracts Accrued liabilities $ 11,009 $ 6,841 $ 20,330 Foreign currency forward exchange and other contracts Other noncurrent liabilities 808 2,507 4,361 Total derivatives designated as hedging instruments $ 11,817 $ 9,348 $ 24,691 Derivatives not designated as hedging instruments Foreign currency forward exchange and other contracts Accrued liabilities $ 5,487 $ 1,594 $ 803 Foreign currency forward exchange and other contracts Other noncurrent liabilities — 224 — Total derivatives not designated as hedging instruments $ 5,487 $ 1,818 $ 803 $ 17,304 $ 11,166 $ 25,494 |
Schedule of Derivatives Designated as Hedging Instruments by Classification and Amount of Gains and Losses | The following tables present the classification and amount of gains and losses, net of tax, from derivatives reported in the consolidated statements of operations: Derivatives Designated As Hedging Instruments For the Three Months Ended March 31, 2021 March 31, 2020 Statements of Operations Classification (In thousands) Foreign currency forward exchange contracts: Amount of gains recognized in OCI $ 4,057 $ 9,190 Amount of (losses) gains reclassified from accumulated OCI to consolidated statements of operations (3,314) 3,210 Cost of sales |
Schedule of Derivatives Not Designated as Hedging Instruments by Classification and Amount of Gains and Losses | Derivatives Not Designated As Hedging Instruments For the Three Months Ended March 31, 2021 March 31, 2020 Statements of Operations Classification (In thousands) Amount of net loss recognized in the Statements of Operations Foreign currency forward exchange and other contract (losses) $ (8,636) $ (38,369) Other non-operating income/expense, net Foreign currency forward exchange and other contract gains 639 — Cost of sales $ (7,997) $ (38,369) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities | Mattel's financial assets and liabilities include the following: March 31, 2021 Level 1 Level 2 Level 3 Total (In thousands) Assets: Foreign currency forward exchange contracts and other (a) $ — $ 7,834 $ — $ 7,834 Available-for-sale (b) 6,232 — — 6,232 Total assets $ 6,232 $ 7,834 $ — $ 14,066 Liabilities: Foreign currency forward exchange contracts and other (a) $ — $ 17,304 $ — $ 17,304 March 31, 2020 Level 1 Level 2 Level 3 Total (In thousands) Assets: Foreign currency forward exchange contracts and other (a) $ — $ 37,457 $ — $ 37,457 Available-for-sale (b) 3,725 — — 3,725 Total assets $ 3,725 $ 37,457 $ — $ 41,182 Liabilities: Foreign currency forward exchange contracts and other (a) $ — $ 11,166 $ — $ 11,166 December 31, 2020 Level 1 Level 2 Level 3 Total (In thousands) Assets: Foreign currency forward exchange contracts and other (a) $ — $ 5,711 $ — $ 5,711 Available-for-sale (b) 4,268 — — 4,268 Total assets $ 4,268 $ 5,711 $ — $ 9,979 Liabilities: Foreign currency forward exchange contracts and other (a) $ — $ 25,494 $ — $ 25,494 ____________________________________________ (a) The fair value of the foreign currency forward exchange contracts and other commodity derivative instruments is based on dealer quotes of market forward rates and reflects the amount that Mattel would receive or pay at their maturity dates for contracts involving the same notional amounts, currencies, and maturity dates. (b) The fair value of the available-for-sale security is based on the quoted price on an active public exchange. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | The following table reconciles basic and diluted earnings per common share for the three months ended March 31, 2021 and 2020: For the Three Months Ended March 31, March 31, (In thousands, except per share amounts) Basic: Net loss $ (115,218) $ (210,741) Weighted-average number of common shares 349,041 346,867 Basic net loss per common share $ (0.33) $ (0.61) Diluted: Net loss $ (115,218) $ (210,741) Weighted-average number of common shares 349,041 346,867 Dilutive stock options and restricted stock units ("RSUs") (a) — — Weighted-average number of common and potential common shares 349,041 346,867 Diluted net loss per common share $ (0.33) $ (0.61) _______________________________________ (a) Mattel was in a net loss position for the three months ended March 31, 2021 and 2020, and, accordingly, all outstanding nonqualified stock options and RSUs were excluded from the calculation of diluted net loss per common share because their effect would be antidilutive. |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Retirement Benefits [Abstract] | |
Schedule of Components of Net Periodic Benefit Cost | A summary of the components of net periodic benefit cost for Mattel's defined benefit pension plans is as follows: For the Three Months Ended March 31, March 31, (In thousands) Service cost $ 1,293 $ 1,109 Interest cost 2,540 3,781 Expected return on plan assets (4,627) (4,921) Amortization of prior service cost 111 43 Recognized actuarial loss 2,785 2,359 $ 2,102 $ 2,371 A summary of the components of net periodic benefit cost for Mattel's postretirement benefit plans is as follows: For the Three Months Ended March 31, March 31, (In thousands) Interest cost $ 19 $ 35 Amortization of prior service credit (509) (509) Recognized actuarial gain (2) (19) $ (492) $ (493) |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Option and Restricted Stock Unit Compensation Expense | Compensation expense, included within other selling and administrative expenses in the consolidated statements of operations, related to stock options, RSUs, and performance awards is as follows: For the Three Months Ended March 31, March 31, (In thousands) Stock option compensation expense $ 2,783 $ 3,131 RSU compensation expense 6,357 7,361 Performance award compensation expense 5,972 3,783 $ 15,112 $ 14,275 |
Other Selling and Administrat_2
Other Selling and Administrative Expenses (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Selling and Administrative Expenses | Other selling and administrative expenses include the following: For the Three Months Ended March 31, March 31, (In thousands) Design and development $ 43,981 $ 44,628 Identifiable intangible asset amortization 9,514 9,965 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Charges | In connection with the Program, Mattel recorded severance and other restructuring costs in the following cost and expense categories within the consolidated statements of operations: For the Three Months Ended March 31, March 31, (In thousands) Cost of sales (a) $ 1,932 $ 3,057 Other selling and administrative expenses (b) 5,710 2,746 $ 7,642 $ 5,803 _______________________________________ (a) Severance and other restructuring costs recorded within cost of sales in the consolidated statements of operations include charges associated with the consolidation of manufacturing facilities. (b) Severance and other restructuring costs recorded within other selling and administrative expenses in the consolidated statements of operations are included in corporate and other expense in "Note 22 to the Consolidated Financial Statements—Segment Information." The following table summarizes Mattel's severance and other restructuring charges activity related to the Program for the three months ended March 31, 2021: Liability at December 31, 2020 Charges (a) Payments/Utilization Liability at March 31, 2021 (In thousands) Severance $ 5,294 $ 4,342 $ (1,405) $ 8,231 Other restructuring charges 30 3,300 (3,071) 259 $ 5,324 $ 7,642 $ (4,476) $ 8,490 _______________________________________ (a) Other restructuring charges consist primarily of charges associated with the consolidation of manufacturing facilities. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Revenues from Segment to Consolidated | The following tables present information regarding net sales, operating income (loss), and assets by segment. The corporate and other expense category includes operating costs not allocated to individual segments, including charges related to incentive and share-based compensation, corporate headquarters functions managed on a worldwide basis, the impact of changes in foreign currency exchange rates on intercompany transactions, and certain severance and other restructuring costs. Effective as of the first quarter of 2021, operating income by segment reviewed by the Chief Operating Decision Maker does not include certain corporate expenses which were historically allocated by segment. The prior period presentation of operating income by segment has been conformed to the current period's presentation. It is impracticable for Mattel to present net sales by categories, brands, or products, as trade discounts and other allowances are generally recorded in the financial accounting systems by customer. For the Three Months Ended March 31, March 31, (In thousands) Net Sales by Segment North America $ 479,660 $ 287,553 International 349,354 269,356 American Girl 45,178 37,160 Net sales $ 874,192 $ 594,069 For the Three Months Ended March 31, March 31, (In thousands) Operating Income (Loss) by Segment North America (a) $ 123,374 $ 13,985 International (a) 35,170 (28,861) American Girl (9,831) (17,441) 148,713 (32,317) Corporate and other expense (b) (117,675) (117,493) Operating income (loss) 31,038 (149,810) Interest expense 130,482 48,980 Interest (income) (820) (2,084) Other non-operating (income) expense, net (1,086) 3,023 Loss before income taxes $ (97,538) $ (199,729) _______________________________________ (a) Operating income (loss) included severance and restructuring expenses of $1.9 million and $3.1 million, for the three months ended March 31, 2021, and 2020, respectively, which were allocated to the North America and International segments. (b) Corporate and other expense included severance and restructuring charges of $5.7 million and $7.5 million, for the three months ended March 31, 2021, and 2020, respectively. Corporate and other expense also included expenses related to inclined sleeper product recall litigation of $5.3 million and $6.3 million for the three months ended March 31, 2021 and 2020, respectively, and incentive and share-based compensation for all periods presented. |
Schedule of Segment Assets | Segment assets are comprised of accounts receivable and inventories, net of applicable allowances and reserves. March 31, March 31, December 31, (In thousands) Assets by Segment North America $ 585,221 $ 480,738 $ 664,696 International 520,717 455,918 713,650 American Girl 46,956 36,427 40,290 1,152,894 973,083 1,418,636 Corporate and other 137,583 116,084 130,003 Accounts receivable and inventories, net $ 1,290,477 $ 1,089,167 $ 1,548,639 |
Schedule of Revenues by Geographic Area | The table below presents information by geographic area. Net sales are attributed to countries based on location of the customer. For the Three Months Ended March 31, March 31, (In thousands) Net Sales by Geographic Area North America $ 524,838 $ 324,713 International EMEA 238,169 173,323 Latin America 56,278 51,275 Asia Pacific 54,907 44,758 Total International 349,354 269,356 Net sales $ 874,192 $ 594,069 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Receivables [Abstract] | |||
Accounts receivable, allowances for credit losses | $ 13.1 | $ 15.9 | $ 20.9 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Inventory Disclosure [Abstract] | |||
Raw materials and work in process | $ 119,417 | $ 110,010 | $ 107,880 |
Finished goods | 490,418 | 404,663 | 452,765 |
Inventories | $ 609,835 | $ 514,673 | $ 560,645 |
Property, Plant, and Equipmen_2
Property, Plant, and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Property, plant, and equipment, gross | $ 2,167,541 | $ 2,216,430 | $ 2,359,157 |
Less: accumulated depreciation | (1,716,540) | (1,742,636) | (1,839,380) |
Property, plant, and equipment, net | 451,001 | 473,794 | 519,777 |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant, and equipment, gross | 22,029 | 24,913 | 24,856 |
Buildings | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant, and equipment, gross | 312,114 | 335,407 | 297,910 |
Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant, and equipment, gross | 764,276 | 772,349 | 769,761 |
Software | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant, and equipment, gross | 345,477 | 344,268 | 367,143 |
Tools, dies, and molds | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant, and equipment, gross | 603,817 | 607,915 | 719,615 |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant, and equipment, gross | 119,828 | $ 131,578 | $ 179,872 |
Land and building | Mexico | |||
Property, Plant and Equipment [Line Items] | |||
Gain on disposal of property, plant, and equipment | $ 15,800 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Goodwill [Roll Forward] | |
Balance at beginning of period | $ 1,393,834 |
Dispositions | (2,346) |
Currency Exchange Rate Impact | 801 |
Balance at end of period | 1,392,289 |
North America | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 733,401 |
Dispositions | (1,290) |
Currency Exchange Rate Impact | 259 |
Balance at end of period | 732,370 |
International | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 452,862 |
Dispositions | (1,056) |
Currency Exchange Rate Impact | 542 |
Balance at end of period | 452,348 |
American Girl | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 207,571 |
Dispositions | 0 |
Currency Exchange Rate Impact | 0 |
Balance at end of period | $ 207,571 |
Other Noncurrent Assets (Detail
Other Noncurrent Assets (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Identifiable intangible assets (net of accumulated amortization of $296.4 million, $258.0 million, and $286.9 million, respectively) | $ 509,844,000 | $ 534,044,000 | $ 518,190,000 |
Deferred income taxes | 71,157,000 | 62,674,000 | 72,682,000 |
Identifiable intangible assets, accumulated amortization | 296,400,000 | 258,000,000 | $ 286,900,000 |
Impairment of intangible assets | $ 0 | $ 0 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Payables and Accruals [Abstract] | |||
Incentive compensation | $ 143,414 | $ 126,601 | $ 135,833 |
Advertising and promotion | 78,755 | 163,181 | 71,563 |
Current lease liabilities | 73,155 | 79,540 | 78,247 |
Royalties | $ 24,191 | $ 54,442 | $ 22,701 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued liabilities | Accrued liabilities | Accrued liabilities |
Seasonal Financing (Details)
Seasonal Financing (Details) - USD ($) | 3 Months Ended | ||||
Mar. 31, 2021 | Mar. 19, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 20, 2017 | |
Debt Instrument [Line Items] | |||||
Short-term borrowings | $ 878,000 | $ 969,000 | $ 150,000,000 | ||
Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Outstanding letters of credit | 11,000,000 | 11,000,000 | 13,000,000 | ||
Revolving Credit Facility | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Aggregate commitment under the credit facility | $ 1,400,000,000 | $ 1,600,000,000 | |||
Short-term borrowings | $ 0 | $ 0 | $ 150,000,000 | ||
Revolving Credit Facility | Credit Agreement | Minimum | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Interest rate margin for loans (as a percent) | 1.25% | ||||
Revolving Credit Facility | Credit Agreement | Minimum | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Interest rate margin for loans (as a percent) | 0.25% | ||||
Revolving Credit Facility | Credit Agreement | Maximum | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Interest rate margin for loans (as a percent) | 1.75% | ||||
Revolving Credit Facility | Credit Agreement | Maximum | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Interest rate margin for loans (as a percent) | 0.75% | ||||
Revolving Credit Facility, Asset Based | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Aggregate commitment under the credit facility | $ 1,110,000,000 | ||||
Revolving Credit Facility, Secured | Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Aggregate commitment under the credit facility | $ 294,000,000 |
Long-Term Debt - Schedule of De
Long-Term Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Debt Instrument [Line Items] | |||
Long-term debt | $ 2,880,000 | $ 2,900,000 | $ 2,900,000 |
Debt issuance costs and debt discount | (37,268) | (45,336) | (51,076) |
Long-term debt | 2,837,732 | 2,854,664 | 2,848,924 |
Senior Notes | 2010 Senior Notes due October 2040 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 250,000 | 250,000 | 250,000 |
Senior Notes | 2011 Senior Notes due November 2041 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 300,000 | 300,000 | 300,000 |
Senior Notes | 2013 Senior Notes due March 2023 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 250,000 | 250,000 | 250,000 |
Senior Notes | 2017/2018 Senior Notes due December 2025 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 275,000 | 1,500,000 | 1,500,000 |
Senior Notes | 2019 Senior Notes due December 2027 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 600,000 | 600,000 | 600,000 |
Senior Notes | 2021 Senior Notes due April 2026 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 600,000 | 0 | 0 |
Senior Notes | 2021 Senior Notes due April 2029 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 600,000 | $ 0 | $ 0 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) | Mar. 19, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Redemption of debt | $ 1,287,022,000 | $ 0 | ||
Loss on extinguishment of long-term borrowings | 83,213,000 | 0 | ||
Long-term debt | 2,880,000,000 | 2,900,000,000 | $ 2,900,000,000 | |
Senior Notes | 2021 Senior Notes due April 2026 | ||||
Debt Instrument [Line Items] | ||||
Principal of debt instrument | $ 600,000,000 | |||
Interest rate | 3.375% | |||
Long-term debt | 600,000,000 | 0 | 0 | |
Senior Notes | 2021 Senior Notes due April 2029 | ||||
Debt Instrument [Line Items] | ||||
Principal of debt instrument | $ 600,000,000 | |||
Interest rate | 3.75% | |||
Long-term debt | 600,000,000 | 0 | 0 | |
Senior Notes | 2017/2018 Senior Notes due December 2025 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 6.75% | |||
Redemption of debt | $ 1,225,000,000 | |||
Loss on extinguishment of long-term borrowings | 83,200,000 | |||
Debt prepayment premium costs | 62,000,000 | |||
Write-off of unamortized debt issuance costs | 21,200,000 | |||
Long-term debt | $ 275,000,000 | $ 1,500,000,000 | $ 1,500,000,000 |
Other Noncurrent Liabilities (D
Other Noncurrent Liabilities (Details) - Other noncurrent liabilities - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Other Commitments [Line Items] | |||
Benefit plan liabilities | $ 221,345 | $ 225,957 | $ 205,694 |
Noncurrent income tax payable | 72,252 | 71,342 | 70,902 |
Deferred income tax liability | $ 60,929 | $ 60,892 | $ 54,896 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Changes in Accumulated Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 596,343 | $ 491,714 |
Other comprehensive income (loss) before reclassifications | (22,179) | (134,547) |
Amounts reclassified from accumulated other comprehensive income (loss) | 5,729 | (1,852) |
Other Comprehensive Loss, Net of Tax | (16,450) | (136,399) |
Ending balance | 473,931 | 157,883 |
Total | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (944,576) | (869,484) |
Other Comprehensive Loss, Net of Tax | (16,450) | (136,399) |
Ending balance | (961,026) | (1,005,883) |
Derivative Instruments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (15,369) | 11,041 |
Other comprehensive income (loss) before reclassifications | 4,057 | 9,190 |
Amounts reclassified from accumulated other comprehensive income (loss) | 3,314 | (3,210) |
Other Comprehensive Loss, Net of Tax | 7,371 | 5,980 |
Ending balance | (7,998) | 17,021 |
Available-for-Sale Security | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (7,522) | (8,260) |
Other comprehensive income (loss) before reclassifications | 1,964 | 195 |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 |
Other Comprehensive Loss, Net of Tax | 1,964 | 195 |
Ending balance | (5,558) | (8,065) |
Employee Benefit Plans | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (186,854) | (169,857) |
Other comprehensive income (loss) before reclassifications | (67) | 1,702 |
Amounts reclassified from accumulated other comprehensive income (loss) | 2,415 | 1,358 |
Other Comprehensive Loss, Net of Tax | 2,348 | 3,060 |
Ending balance | (184,506) | (166,797) |
Currency Translation Adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (734,831) | (702,408) |
Other comprehensive income (loss) before reclassifications | (28,133) | (145,634) |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 |
Other Comprehensive Loss, Net of Tax | (28,133) | (145,634) |
Ending balance | $ (762,964) | $ (848,042) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Reclassification from AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Provision for income taxes | $ 20,305 | $ 11,892 |
Other Nonoperating Income (Expense) | (1,086) | 3,023 |
Loss before income taxes | 97,538 | 199,729 |
Net Loss | 115,218 | 210,741 |
Reclassification Out of Accumulated Other Comprehensive Income (Loss) | Derivative Instruments | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Cost of sales | (3,206) | 3,193 |
Provision for income taxes | (108) | 17 |
Net Loss | (3,314) | 3,210 |
Reclassification Out of Accumulated Other Comprehensive Income (Loss) | Employee Benefit Plans | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Provision for income taxes | (30) | 516 |
Loss before income taxes | (2,385) | (1,874) |
Net Loss | (2,415) | (1,358) |
Reclassification Out of Accumulated Other Comprehensive Income (Loss) | Amortization of prior service credit | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other Nonoperating Income (Expense) | 398 | 466 |
Reclassification Out of Accumulated Other Comprehensive Income (Loss) | Recognized actuarial loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other Nonoperating Income (Expense) | $ (2,783) | $ (2,340) |
Accumulated Other Comprehensi_5
Accumulated Other Comprehensive Income (Loss) - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Currency translation adjustments (loss) gain | $ (16,450) | $ (136,399) |
Currency Translation Adjustments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Currency translation adjustments (loss) gain | $ (28,133) | $ (145,634) |
Foreign Currency Transaction _3
Foreign Currency Transaction Exposure (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Currency Transaction Gains (Losses) [Line Items] | ||
Currency transaction (losses), net | $ (17,099) | $ (608) |
Operating income/loss | ||
Currency Transaction Gains (Losses) [Line Items] | ||
Currency transaction (losses), net | (13,791) | 224 |
Other non-operating income/expense, net | ||
Currency Transaction Gains (Losses) [Line Items] | ||
Currency transaction (losses), net | $ (3,308) | $ (832) |
Derivative Instruments - Narrat
Derivative Instruments - Narrative (Details) - Foreign currency forward exchange and other contracts - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Notional amount | $ 951.5 | $ 855 | $ 1,370 |
Maximum | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative term of contracts | 18 months |
Derivative Instruments - Assets
Derivative Instruments - Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Derivatives, Fair Value [Line Items] | |||
Derivative assets, fair value | $ 7,834 | $ 5,711 | $ 37,457 |
Derivative liabilities, fair value | 17,304 | 25,494 | 11,166 |
Derivatives designated as hedging instruments | |||
Derivatives, Fair Value [Line Items] | |||
Derivative assets, fair value | 5,784 | 3,691 | 23,646 |
Derivative liabilities, fair value | 11,817 | 24,691 | 9,348 |
Derivatives designated as hedging instruments | Foreign currency forward exchange and other contracts | Prepaid expenses and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative assets, fair value | 4,534 | 3,641 | 21,121 |
Derivatives designated as hedging instruments | Foreign currency forward exchange and other contracts | Other noncurrent assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative assets, fair value | 1,250 | 50 | 2,525 |
Derivatives designated as hedging instruments | Foreign currency forward exchange and other contracts | Accrued liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liabilities, fair value | 11,009 | 20,330 | 6,841 |
Derivatives designated as hedging instruments | Foreign currency forward exchange and other contracts | Other noncurrent liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liabilities, fair value | 808 | 4,361 | 2,507 |
Derivatives not designated as hedging instruments | |||
Derivatives, Fair Value [Line Items] | |||
Derivative assets, fair value | 2,050 | 2,020 | 13,811 |
Derivatives not designated as hedging instruments | Foreign currency forward exchange and other contracts | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liabilities, fair value | 5,487 | 803 | 1,818 |
Derivatives not designated as hedging instruments | Foreign currency forward exchange and other contracts | Prepaid expenses and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative assets, fair value | 2,050 | 1,982 | 13,811 |
Derivatives not designated as hedging instruments | Foreign currency forward exchange and other contracts | Other noncurrent assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative assets, fair value | 0 | 38 | 0 |
Derivatives not designated as hedging instruments | Foreign currency forward exchange and other contracts | Accrued liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liabilities, fair value | 5,487 | 803 | 1,594 |
Derivatives not designated as hedging instruments | Foreign currency forward exchange and other contracts | Other noncurrent liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liabilities, fair value | $ 0 | $ 0 | $ 224 |
Derivative Instruments - Design
Derivative Instruments - Designated as Hedging Instruments by Classification and Amount of Gains and Losses (Details) - Derivatives Designated As Hedging Instruments - Foreign Exchange Forward - Cost of sales - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of gains recognized in OCI | $ 4,057 | $ 9,190 |
Amount of (losses) gains reclassified from accumulated OCI to consolidated statements of operations | $ (3,314) | $ 3,210 |
Derivative Instruments - Not De
Derivative Instruments - Not Designated as Hedging Instruments by Classification and Amount of Gains and Losses (Details) - Derivatives Not Designated As Hedging Instruments - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of net loss recognized in the Statements of Operations | $ (7,997) | $ (38,369) |
Foreign Exchange Forward | Other non-operating income/expense, net | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of net loss recognized in the Statements of Operations | (8,636) | (38,369) |
Foreign Exchange Forward | Cost of sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of net loss recognized in the Statements of Operations | $ 639 | $ 0 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Assets: | |||
Foreign currency forward exchange contracts and other | $ 7,834 | $ 5,711 | $ 37,457 |
Available-for-sale security | 6,232 | 4,268 | 3,725 |
Total assets | 14,066 | 9,979 | 41,182 |
Liabilities: | |||
Foreign currency forward exchange contracts and other | 17,304 | 25,494 | 11,166 |
Level 1 | |||
Assets: | |||
Foreign currency forward exchange contracts and other | 0 | 0 | 0 |
Available-for-sale security | 6,232 | 4,268 | 3,725 |
Total assets | 6,232 | 4,268 | 3,725 |
Liabilities: | |||
Foreign currency forward exchange contracts and other | 0 | 0 | 0 |
Level 2 | |||
Assets: | |||
Foreign currency forward exchange contracts and other | 7,834 | 5,711 | 37,457 |
Available-for-sale security | 0 | 0 | 0 |
Total assets | 7,834 | 5,711 | 37,457 |
Liabilities: | |||
Foreign currency forward exchange contracts and other | 17,304 | 25,494 | 11,166 |
Level 3 | |||
Assets: | |||
Foreign currency forward exchange contracts and other | 0 | 0 | 0 |
Available-for-sale security | 0 | 0 | 0 |
Total assets | 0 | 0 | 0 |
Liabilities: | |||
Foreign currency forward exchange contracts and other | $ 0 | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Fair Value Disclosures [Abstract] | |||
Estimated fair value of long-term debt | $ 3,050 | $ 3,110 | $ 2,770 |
Carrying value of long-term debt | $ 2,880 | $ 2,900 | $ 2,900 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Basic: | ||
Net Loss | $ (115,218) | $ (210,741) |
Weighted average number of common shares (in shares) | 349,041 | 346,867 |
Basic net loss per common share (USD per share) | $ (0.33) | $ (0.61) |
Diluted: | ||
Net Loss | $ (115,218) | $ (210,741) |
Weighted average number of common shares (in shares) | 349,041 | 346,867 |
Dilutive stock options and non-participating RSUs (in shares) | 0 | 0 |
Weighted average number of common and potential common shares (in shares) | 349,041 | 346,867 |
Diluted net loss per common share (USD per share) | $ (0.33) | $ (0.61) |
Employee Benefit Plans - Compon
Employee Benefit Plans - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Defined Benefit Pension Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 1,293 | $ 1,109 |
Interest cost | 2,540 | 3,781 |
Expected return on plan assets | (4,627) | (4,921) |
Amortization of prior service cost | 111 | 43 |
Recognized actuarial loss | 2,785 | 2,359 |
Net periodic benefit cost (credit) | 2,102 | 2,371 |
Postretirement Benefit Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Interest cost | 19 | 35 |
Amortization of prior service cost | (509) | (509) |
Recognized actuarial loss | (2) | (19) |
Net periodic benefit cost (credit) | $ (492) | $ (493) |
Employee Benefit Plans - Narrat
Employee Benefit Plans - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Retirement Benefits [Abstract] | |
Cash contributions made during the period | $ 1 |
Expected additional cash contributions | $ 16 |
Share-Based Payments - Narrativ
Share-Based Payments - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2021USD ($)incentiveProgram | Mar. 31, 2020USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of incentive programs | incentiveProgram | 3 | |
Proceeds from exercise of stock options | $ 1,300,000 | $ 0 |
Stock options | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Period of stock option expiration from date of grant | 10 years | |
Stock options, RSUs, and performance shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total unrecognized compensation expense related to unvested share-based payments | $ 79,000,000 | |
Weighted-average period for unrecognized compensation expense expected to be recognized | 2 years | |
Stock options, RSUs, and performance shares | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
General vesting period | 3 years |
Share-Based Payments - Compensa
Share-Based Payments - Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 15,112 | $ 14,275 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | 2,783 | 3,131 |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | 6,357 | 7,361 |
Performance awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 5,972 | $ 3,783 |
Other Selling and Administrat_3
Other Selling and Administrative Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Other Income and Expenses [Abstract] | ||
Design and development | $ 43,981 | $ 44,628 |
Identifiable intangible asset amortization | $ 9,514 | $ 9,965 |
Restructuring Charges - Schedul
Restructuring Charges - Schedule of Capital Light Restructuring Charges (Details) - Optimizing for Growth (formerly Capital Light Initiative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 7,642 | $ 5,803 |
Cost of sales | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 1,932 | 3,057 |
Other selling and administrative expenses | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 5,710 | $ 2,746 |
Restructuring Charges - Severan
Restructuring Charges - Severance and Other Restructuring Charges Activity (Details) - Optimizing for Growth (formerly Capital Light Initiative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Restructuring Reserve [Roll Forward] | ||
Liability at beginning of period | $ 5,324 | |
Charges | 7,642 | $ 5,803 |
Payments/Utilization | (4,476) | |
Liability at end of period | 8,490 | |
Severance | ||
Restructuring Reserve [Roll Forward] | ||
Liability at beginning of period | 5,294 | |
Charges | 4,342 | |
Payments/Utilization | (1,405) | |
Liability at end of period | 8,231 | |
Other restructuring charges | ||
Restructuring Reserve [Roll Forward] | ||
Liability at beginning of period | 30 | |
Charges | 3,300 | |
Payments/Utilization | (3,071) | |
Liability at end of period | $ 259 |
Restructuring Charges - Narrati
Restructuring Charges - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Mexico | Land and building | ||
Restructuring Cost and Reserve [Line Items] | ||
Gain on disposal of property, plant, and equipment | $ 15.8 | |
Optimizing for Growth (formerly Capital Light Initiative) | ||
Restructuring Cost and Reserve [Line Items] | ||
Severance and other restructuring charges incurred to date | 58 | |
Restructuring and related cost, cost incurred to date, non-cash charges | 17 | |
Optimizing for Growth (formerly Capital Light Initiative) | Minimum | ||
Restructuring Cost and Reserve [Line Items] | ||
Expected restructuring costs | 140 | |
Expected non-cash restructuring costs | 40 | |
Optimizing for Growth (formerly Capital Light Initiative) | Maximum | ||
Restructuring Cost and Reserve [Line Items] | ||
Expected restructuring costs | 165 | |
Expected non-cash restructuring costs | $ 45 | |
Severance | Other Cost Savings Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Severance charges | $ 5 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Provision for income taxes | $ 20,305,000 | $ 11,892,000 |
Discrete tax expense (benefit) | 7,300,000 | 6,400,000 |
Current federal tax benefit | 0 | $ 0 |
Reasonably possible changes to unrecognized tax benefits related to settlement of tax audits and/or expiration of statutes of limitations within the next twelve months | $ 31,600,000 |
Contingencies (Details)
Contingencies (Details) $ in Millions | Apr. 26, 2015 | Jan. 31, 2010USD ($) | Apr. 30, 1999USD ($) | Jan. 31, 2020stockholder | Mar. 31, 2021childclasslawsuit | Nov. 11, 2014USD ($) | Jul. 26, 2013USD ($) |
Loss Contingencies [Line Items] | |||||||
Number of stockholders who filed complaints | stockholder | 2 | ||||||
Yellowstone | |||||||
Loss Contingencies [Line Items] | |||||||
Alleged loss of profits | $ 1 | ||||||
Unpaid accounts receivable | 4 | ||||||
Alleged business investments | 3 | ||||||
Initial estimate of loss of profits | $ 1 | ||||||
Court awarded damages from counterclaim | $ 4 | ||||||
Damages awarded, including attorney fees, inflation and interest | $ 17 | ||||||
Counter claim awarded, including inflation | $ 7.5 | $ 7.5 | |||||
Damages award including inflation and interest | $ 14.5 | ||||||
Fine on claims (as a percent) | 1.00% | ||||||
Sleeper | |||||||
Loss Contingencies [Line Items] | |||||||
Number of additional lawsuits pending | lawsuit | 49 | ||||||
Number of children with injuries or fatalities related to lawsuits | child | 53 | ||||||
Minimum | Sleeper | |||||||
Loss Contingencies [Line Items] | |||||||
Number of consumer classes | class | 15 |
Segment Information - Revenues
Segment Information - Revenues and Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 874,192 | $ 594,069 |
Operating income (loss) | 31,038 | (149,810) |
Interest expense | 130,482 | 48,980 |
Interest (income) | (820) | (2,084) |
Other Nonoperating Income (Expense) | (1,086) | 3,023 |
Loss Before Income Taxes | (97,538) | (199,729) |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Operating income (loss) | 148,713 | (32,317) |
Operating Segments | North America | ||
Segment Reporting Information [Line Items] | ||
Revenues | 479,660 | 287,553 |
Operating income (loss) | 123,374 | 13,985 |
Operating Segments | International | ||
Segment Reporting Information [Line Items] | ||
Revenues | 349,354 | 269,356 |
Operating income (loss) | 35,170 | (28,861) |
Operating Segments | American Girl | ||
Segment Reporting Information [Line Items] | ||
Revenues | 45,178 | 37,160 |
Operating income (loss) | (9,831) | (17,441) |
Operating Segments | North America and International | ||
Segment Reporting Information [Line Items] | ||
Restructuring charges | 1,900 | 3,100 |
Corporate and other expense | ||
Segment Reporting Information [Line Items] | ||
Operating income (loss) | (117,675) | (117,493) |
Restructuring charges | 5,700 | 7,500 |
Total product recall charges | $ 5,300 | $ 6,300 |
Segment Information - Assets (D
Segment Information - Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Accounts receivable and inventories, net | $ 1,290,477 | $ 1,548,639 | $ 1,089,167 |
Operating Segments | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Accounts receivable and inventories, net | 1,152,894 | 1,418,636 | 973,083 |
Operating Segments | North America | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Accounts receivable and inventories, net | 585,221 | 664,696 | 480,738 |
Operating Segments | International | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Accounts receivable and inventories, net | 520,717 | 713,650 | 455,918 |
Operating Segments | American Girl | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Accounts receivable and inventories, net | 46,956 | 40,290 | 36,427 |
Corporate and other expense | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Accounts receivable and inventories, net | $ 137,583 | $ 130,003 | $ 116,084 |
Segment Information - Revenue_2
Segment Information - Revenues by Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 874,192 | $ 594,069 |
Operating Segments | North America | ||
Segment Reporting Information [Line Items] | ||
Revenues | 479,660 | 287,553 |
Operating Segments | North America | North America | ||
Segment Reporting Information [Line Items] | ||
Revenues | 524,838 | 324,713 |
Operating Segments | International | ||
Segment Reporting Information [Line Items] | ||
Revenues | 349,354 | 269,356 |
Operating Segments | International | EMEA | ||
Segment Reporting Information [Line Items] | ||
Revenues | 238,169 | 173,323 |
Operating Segments | International | Latin America | ||
Segment Reporting Information [Line Items] | ||
Revenues | 56,278 | 51,275 |
Operating Segments | International | Asia Pacific | ||
Segment Reporting Information [Line Items] | ||
Revenues | $ 54,907 | $ 44,758 |