Mattel Is Finally Playing to Win
Traditional toy sales have consistently shrunk in recent years. Some blame it on tariff wars raising costs for producers, but more attribute the contraction to kids shifting toward digital entertainment. Toy companies like Hasbro and Mattel (NASDAQ: MAT) have been tasked with adapting their own product offerings to meet evolving consumer expectations.
In response, over the past several years, Hasbro has worked to build out its licensing and partnership businesses. Brands such as Transformers were turned into several profitable movies. Licensing and partnership revenue streams carry an approximately 30% operating margin for Hasbro, far higher than any other segment of the business. Mattel has the muscle -- and now, the leadership in place -- to follow in Habro's footsteps with its own deals.
Image source: Getty Images
Source Fool.com
