Mattel Inc. (NYSE: MAT) lost another chief executive officer. Even strong sales of Barbie dolls could not salvage the company’s most recent quarter, and CEO Margo Georgiadis was sacked.
Georgiadis did not last very long. Mattel tried to spin the decision, but the troubles it has had are transparent.
The announcement read:
Mattel, Inc. today announced that the Board of Directors has named Ynon Kreiz, a Mattel director since June 2017, as Chief Executive Officer effective April 26, 2018. Margo Georgiadis, who became Mattel’s CEO in February 2017, has informed the Board of her decision to step down from her executive and Board roles to pursue a new opportunity in the technology sector. Ms. Georgiadis will serve in an advisory role at Mattel through May 10, 2018 to ensure a smooth transition.
That is only 14 months, which even for a company in dire need of a turnaround is not a very long time.
In the most recently reported quarter, Mattel’s sales fell 16% to $1.6 billion. It lost $281 million, after a $173 million profit in the same period of last year. Much of the blame for the poor results was put on the Toys “R” Us bankruptcy, as the failed retailer was a major outlet for Mattel toys.
In the period, sales of Barbie, Mattel’s most famous product, rose 9%. The ancient toy, now in its 59th year on the market, could not counterbalance poor results at other units. In particular, the American Girl brand sputtered:
Fourth quarter worldwide gross sales for American Girl Brands were $217.3 million, down 23% as reported and in constant currency, versus the prior year’s fourth quarter, primarily driven by lower sales across channels.
Mattel’s shares have had a rough ride, down 46% in the past year to $13.45. Over the same period, the S&P 500 is up 22%.
Mattel’s rough attempt at recovery has been blamed on the lack of enough new age, electronic toys. It does market mobile apps for its toys, but that apparently is not enough.
After a period when sales dropped, Barbie is back in business, but not enough to save one more fired CEO’s job.