Q4 Earnings Roundup: Mattel (NASDAQ:MAT) And The Rest Of The Toys and Electronics Segment
As the Q4 earnings season comes to a close, it’s time to take stock of this quarter's best and worst performers in the toys and electronics industry, including Mattel (NASDAQ:MAT) and its peers.
The toys and electronics industry presents both opportunities and challenges for investors. Established companies often enjoy strong brand recognition and customer loyalty while smaller players can carve out a niche if they develop a viral, hit new product. The downside, however, is that success can be short-lived because the industry is very competitive: the barriers to entry for developing a new toy are low, which can lead to pricing pressures and reduced profit margins, and the rapid pace of technological advancements necessitates continuous product updates, increasing research and development costs, and shortening product life cycles for electronics companies. Furthermore, these players must navigate various regulatory requirements, especially regarding product safety, which can pose operational challenges and potential legal risks.
The 7 toys and electronics stocks we track reported a weak Q4; on average, revenues missed analyst consensus estimates by 1%, while next quarter's revenue guidance was 3.5% below consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. The beginning of 2024 saw mixed inflation data, however, leading to more volatile stock performance, and toys and electronics stocks have held roughly steady amidst all this, with share prices up 3.5% on average since the previous earnings results.
Mattel (NASDAQ:MAT)
Known for the creation of iconic toys such as Barbie and Hotwheels, Mattel (NASDAQ:MAT) is a global children's entertainment company specializing in the design and production of consumer products.
Mattel reported revenues of $1.62 billion, up 15.6% year on year, falling short of analyst expectations by 1.1%. It was a mixed quarter for the company, with EPS exceeding expectations. Its free cash flow for the full year also beat expectations, enabling it to repurchase $203 million of shares in 2023. The Board also authorized another $1 billion of share repurchases. On the other hand, its revenue missed Wall Street's estimates this quarter as its international sales were underwhelming (3% year-on-year growth).
Ynon Kreiz, Chairman and CEO of Mattel, said: “2023 was a milestone year for Mattel. We extended our leadership in our key toy categories and gained significant share overall, achieved extraordinary success with the Barbie movie, and further strengthened our financial position.”
Mattel scored the fastest revenue growth of the whole group. The stock is down 4.4% since the results and currently trades at $18.
Read our full report on Mattel here, it's free.
Best Q4: Sonos (NASDAQ:SONO)
A pioneer in connected home audio systems, Sonos (NASDAQ:SONO) offers a range of premium wireless speakers and sound systems.
Sonos reported revenues of $612.9 million, down 8.9% year on year, outperforming analyst expectations by 4.4%. It was a strong quarter for the company, with an impressive beat of analysts' earnings estimates and a solid beat of analysts' revenue estimates.
Sonos delivered the biggest analyst estimates beat and highest full-year guidance raise among its peers. The stock is up 6.3% since the results and currently trades at $17.5.
Is now the time to buy Sonos? Access our full analysis of the earnings results here, it's free.
Weakest Q4: GoPro (NASDAQ:GPRO)
Known for sponsoring extreme athletes, GoPro (NASDAQ:GPRO) is a camera company known for its POV videos and editing software.
GoPro reported revenues of $295.4 million, down 8% year on year, falling short of analyst expectations by 9.4%. It was a weak quarter for the company, with a miss of analysts' cameras sold estimates. Revenue also fell significantly below estimates.
GoPro had the weakest performance against analyst estimates in the group. The stock is down 40% since the results and currently trades at $1.74.
Read our full analysis of GoPro's results here.
Hasbro (NASDAQ:HAS)
Credited with the creation of toys such as Mr. Potato Head and the Rubik’s Cube, Hasbro (NASDAQ:HAS) is a global entertainment company offering a diverse range of toys, games, and multimedia experiences for children and families.
Hasbro reported revenues of $1.29 billion, down 23.2% year on year, falling short of analyst expectations by 4.9%. It was a weak quarter for the company, with a miss of analysts' revenue estimates.
Hasbro had the slowest revenue growth among its peers. The stock is up 7.8% since the results and currently trades at $55.33.
Read our full, actionable report on Hasbro here, it's free.
Bark (NYSE:BARK)
Making a name for itself with the BarkBox, Bark (NYSE:BARK) specializes in subscription-based, personalized pet products.
Bark reported revenues of $125.1 million, down 6.9% year on year, surpassing analyst expectations by 1.4%. It was a slower quarter for the company, with a miss of analysts' earnings estimates.
The stock is up 18.8% since the results and currently trades at $1.09.
Read our full, actionable report on Bark here, it's free.
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