NEW YORK (AP) — Mattel Inc., the maker of Barbie dolls, Scorching Wheels automobiles and different well-liked toys, stated Monday that it must increase costs for some merchandise offered within the U.S. “the place vital” to offset greater prices associated to President Donald Trump’s tariffs.
The El Segundo, California-based firm stated the will increase are vital regardless that it’s dashing up its plans to diversify its manufacturing base away from China. Trump imposed a 145% tariff on most Chinese language-made merchandise.
Firm executives advised analysts on a convention name that China presently accounts for 40% of Mattel’s world manufacturing. The corporate plans to maneuver roughly 500 merchandise this yr from producers in China to sources in different nations, in comparison with 280 merchandise final yr.
For some extremely sought-after toys, Mattel stated it will enlist factories in multiple nation. To forestall potential shortages, the corporate stated it was specializing in getting merchandise to shops with out interruptions.
The corporate stated that even with worth will increase it expects 40% to 50% of its toys will price clients $20 or much less.
“The diversified and versatile provide chain in world industrial organizations are clear benefits to Mattel on this interval of uncertainty,” CEO and Chairman Ynon Kreiz advised analysts.
Citing the continuing uncertainty surrounding the president’s commerce insurance policies, nonetheless, Mattel withdrew its annual earnings forecast on Monday.
The corporate stated it will be “troublesome to foretell” shopper spending and the corporate’s U.S. gross sales for the rest of the yr with out extra info.
Mattel reported larger-than anticipated first-quarter gross sales but additionally a wider loss. Mattel stated gross sales rose 2% to $827 million for the quarter that ended March 31.
The corporate’s loss expanded to $40.3 million, or 12 cents per share, within the quarter. That compares with a lack of $28.3 million, or 8 cents per share, within the year-ago interval.
Analysts anticipated a lack of 10 cents on gross sales of $786.1 million for the primary quarter, based on FactSet.
Mattel’s shares had been down lower than 1% in after markets buying and selling.