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MAT, Mattel

Leisure Products consumer brand Cyclical

Mattel is a leading global play and family entertainment company and owner of one of the most iconic brand portfolios in the world.

Mattel is the owner of a portfolio of iconic brands and partners with global entertainment companies to license other IP.

Mattel's portfolio of owned and licensed brands and products are organized into the following categories: Dolls —including brands such as Barbie , American Girl , Disney Princess , Disney Frozen , Monster High, Polly Pocket, and KPop Demon Hunters .

Latest annual: FY2025 10-K

MAT · Mattel

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$5.3B

−0.6% YoY · 3% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $5.4B 5-yr avg $5.4B

Gross margin 48% 5-yr avg 48%

Operating margin 9.2% 5-yr avg 11.8%

ROIC 12% 5-yr avg 15%

Owner-earnings margin 8% 5-yr avg 10%

Free cash flow margin 8% 5-yr avg 10%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Gross margin has run about 47% and operating margin about 10% through the cycle, a solid spread between what it charges and what the product costs to make. The operating margin has swung widely — from −6.9% to 13% — on a steadier 47% gross margin, so what moves it sits below the gross line, in operating spend and one-off charges more than in the cost of the product itself. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has sat near the cost of capital (median 11%). By owner earnings: roughly 7% of revenue reaches owners as cash, though it swings. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$5.5B	$4.9B	$4.5B	$4.5B	$4.6B	$5.5B	$5.4B	$5.4B	$5.4B	$5.3B	$5.4B	RevenueRevenue
47%	37%	40%	44%	49%	48%	46%	47%	51%	49%	48%	Gross marginGross mgn
4%	5%	5%	4%	4%	3%	4%	4%	4%	4%	4%	R&D / revenueR&D/rev
$520M	($336M)	($234M)	$37M	$375M	$730M	$676M	$562M	$694M	$546M	$497M	Operating incomeOp. inc.
9.5%	−6.9%	−5.2%	0.8%	8.2%	13.4%	12.4%	10.3%	12.9%	10.2%	9.2%	Operating marginOp. mgn
$313M	($1.1B)	($533M)	($219M)	$124M	$903M	$394M	$214M	$542M	$398M	$499M	Net incomeNet inc.
22%	—	—	—	35%	—	26%	56%	16%	18%	15%	Effective tax rateTax rate
											Cash flow & returns
$595M	($28M)	($27M)	$168M	$286M	$485M	$443M	$870M	$801M	$593M	$545M	Operating cash flowOp. cash
$262M	$275M	$272M	$245M	$193M	$184M	$182M	$177M	$168M	$168M	$170M	DepreciationDeprec.
($35M)	$685M	$185M	$87M	($92M)	($662M)	($202M)	$395M	$11M	($52M)	($196M)	Working capital & otherWC & other
$140M	$129M	$75M	$51M	$59M	$77M	$106M	$86M	$135M	$111M	$135M	CapexCapex
2.6%	2.6%	1.7%	1.1%	1.3%	1.4%	2.0%	1.6%	2.5%	2.1%	2.5%	Capex / revenueCapex/rev
$454M	($157M)	($102M)	$118M	$226M	$408M	$337M	$784M	$665M	$483M	$411M	Owner earningsOwner earn.
8.3%	−3.2%	−2.3%	2.6%	4.9%	7.5%	6.2%	14.4%	12.4%	9.0%	7.6%	Owner earnings marginOE mgn
$454M	($157M)	($102M)	$118M	$226M	$408M	$337M	$784M	$665M	$483M	$411M	Free cash flowFCF
8.3%	−3.2%	−2.3%	2.6%	4.9%	7.5%	6.2%	14.4%	12.4%	9.0%	7.6%	Free cash flow marginFCF mgn
$33M	$0	$0	—	—	—	—	—	—	—	$0	AcquisitionsAcquis.
$519M	$312M	$0	$0	—	—	—	—	—	—	$0	Dividends paidDiv. paid
$0	—	—	—	—	$0	$0	$203M	$400M	$600M	—	BuybacksBuybacks
11%	-8%	-6%	—	9%	21%	14%	9%	18%	13%	12%	ROICROIC
13%	-84%	-77%	-43%	20%	58%	19%	10%	24%	18%	24%	Return on equityROE
−9%	−109%	−77%	−43%	—	—	—	—	—	—	24%	Retained to equityRetained/eq
											Balance sheet
$870M	$181M	$594M	$630M	$762M	$731M	$761M	$1.3B	$1.4B	$1.2B	$866M	Cash & investmentsCash+inv
$1.1B	$1.5B	$970M	$936M	$1.0B	$1.1B	$860M	$1.1B	$1.0B	$1.1B	$687M	ReceivablesReceiv.
$614M	$990M	$543M	$496M	$528M	$777M	$894M	$572M	$502M	$563M	$677M	InventoryInvent.
$665M	$713M	$538M	$459M	$495M	$579M	$471M	$442M	$399M	$555M	$373M	Accounts payablePayables
$1.1B	$1.8B	$975M	$973M	$1.1B	$1.3B	$1.3B	$1.2B	$1.1B	$1.1B	$990M	Operating working capitalOper. WC
$2.9B	$3.0B	$2.3B	$2.2B	$2.5B	$2.9B	$2.7B	$3.1B	$3.1B	$3.1B	$2.5B	Current assetsCur. assets
$1.5B	$2.3B	$1.2B	$1.3B	$1.4B	$1.6B	$1.2B	$1.3B	$1.3B	$1.5B	$1.2B	Current liabilitiesCur. liab.
2.0×	1.3×	1.9×	1.8×	1.8×	1.8×	2.3×	2.3×	2.4×	2.1×	2.1×	Current ratioCurr. ratio
$1.4B	$1.4B	$1.4B	$1.4B	$1.4B	$1.4B	$1.4B	$1.4B	$1.4B	$1.4B	$1.6B	GoodwillGoodwill
$6.5B	$6.2B	$5.2B	$5.3B	$5.5B	$6.4B	$6.2B	$6.4B	$6.5B	$6.6B	$6.3B	Total assetsAssets
$2.1B	$2.1B	$2.9B	$2.8B	$2.9B	$2.6B	$2.3B	$2.3B	$2.3B	$2.3B	$2.3B	Total debtDebt
$1.3B	$2.0B	$2.3B	$2.2B	$2.1B	$1.8B	$1.6B	$1.1B	$946M	$1.1B	$1.5B	Net debt / (cash)Net debt
5.5×	-3.2×	-1.3×	0.2×	1.9×	2.9×	5.1×	4.5×	5.8×	4.6×	4.1×	Interest coverageInt. cov.
$2.4B	$1.3B	$689M	$509M	$610M	$1.6B	$2.1B	$2.1B	$2.3B	$2.2B	$2.1B	Shareholders’ equityEquity
1.0%	1.4%	1.1%	1.2%	1.3%	1.1%	1.3%	1.5%	1.5%	1.5%	1.4%	Stock comp / revenueSBC/rev
											Per share
344M	344M	345M	346M	349M	357M	360M	357M	343M	322M	301M	Shares out (diluted)Shares
$15.84	$14.21	$13.09	$13.01	$13.14	$15.28	$15.11	$15.24	$15.67	$16.62	$17.89	Revenue / shareRev/sh
$0.91	$-3.07	$-1.55	$-0.63	$0.35	$2.53	$1.10	$0.60	$1.58	$1.24	$1.66	EPS (diluted)EPS
$1.32	$-0.46	$-0.30	$0.34	$0.65	$1.14	$0.94	$2.20	$1.94	$1.50	$1.36	Owner earnings / shareOE/sh
$1.32	$-0.46	$-0.30	$0.34	$0.65	$1.14	$0.94	$2.20	$1.94	$1.50	$1.36	Free cash flow / shareFCF/sh
$1.51	$0.91	$0.00	$0.00	—	—	—	—	—	—	$0.00	Dividends / shareDiv/sh
$0.41	$0.38	$0.22	$0.15	$0.17	$0.22	$0.30	$0.24	$0.39	$0.34	$0.45	Cap. spending / shareCapex/sh
$7.00	$3.66	$2.00	$1.47	$1.75	$4.39	$5.72	$6.02	$6.59	$6.94	$7.00	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+0.5%/yr	+4.8%/yr
Owner earnings / share	+1.4%/yr	+18.3%/yr
EPS	+3.5%/yr	+28.4%/yr
Capital spending / share	−1.9%/yr	+15.1%/yr
Book value / share	−0.1%/yr	+31.8%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

322Mpeak FY2022

ROIC

13%low FY2017

Gross margin

49%low FY2017

Net debt ÷ owner earnings

2.3×peak FY2019

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$483Mowner earningsvs.$398Mnet incomelow FY2017

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business turned $398M of profit into $483M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

Reported net income$398M

Owner earnings$483M · 9% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$398M	$542M	$214M	$394M	$903M
Depreciation & amortizationnon-cash charge added back	+$168M	+$168M	+$177M	+$182M	+$184M
Stock-based compensationreal costnon-cash, but a real cost	+$80M	+$79M	+$83M	+$69M	+$60M
Working capital & othertiming of cash in and out, other non-cash items	−$52M	+$11M	+$395M	−$202M	−$662M
Cash from operations	$593M	$801M	$870M	$443M	$485M
Capital expenditurecash put back in to keep running and to grow	−$111M	−$135M	−$86M	−$106M	−$77M
Owner earnings	$483M	$665M	$784M	$337M	$408M
Owner-earnings marginowner earnings ÷ revenue	9%	12%	14%	6%	7%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $80M), owner earnings is nearer $403M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Material weakness in financial controls

“As disclosed in Part II, Item 9A "Controls and Procedures," Mattel previously determined that there was a material weakness in its internal control over financial reporting, which has been remediated as of December 31, 2025.”

The figures below are only as sound as the controls that produced them. read the note →

Will it survive?

Can it pay its interest? 4.6×

Adequate

Operating income $546M ÷ interest expense $119M

What this means
Comfortable in a normal year, but below the margin of safety Graham looked for. Worth checking how stable the coverage has been across a full cycle.
How heavy is the debt, net of cash? $1.1B · 2.0× operating profit

Modest net debt

Cash $1.2B − debt $2.3B

What this means
Netting $1.2B of cash and short-term investments against $2.3B of debt leaves $1.1B owed, about 2.0× a year's operating profit (4.3× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 76d

Long (60+ days)

DSO 75 + DIO 75 − DPO 74 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 11%

Solid through the cycle

9-yr median, range -8%–21%; 13% latest = NOPAT $446M ÷ invested capital $3.3B

Industry peers: median 12%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 9 years (it ran 13% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 6%

Solid through the cycle

10-yr median margin, range -3%–14%; latest $483M = operating cash $593M − maintenance capex $111M

Industry peers: median 8%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 9% of revenue this year, a 6% median across 10 years. Treating stock comp as the real expense it is (less $80M of SBC) leaves $403M.
Are earnings backed by cash? 1.49×

Cash-backed

Cash from ops $593M ÷ net income $398M

In the filing’s words The filing discloses a material weakness in its financial controls — the reported numbers here, and the record built on them, are only as reliable as the controls that produced them.

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 124%

Returned more than it generated

Dividends + buybacks $600M ÷ Owner Earnings $483M

What this means
The company returned more than it generated: against $483M of Owner Earnings, $600M (124%) went back to shareholders, $0 dividends, $600M buybacks — the excess came from the balance sheet or borrowing, not the year's operations. Net of $80M stock comp, the real buyback was about $520M. Sustained, that pattern draws down cash or adds debt; the net-debt line above shows where it stands.
Investing or harvesting? 0.66×

Harvesting

Capex $111M ÷ depreciation $168M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $5.3B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.15×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Near

Debt ≤ working capital · $2.3B vs $1.7B WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 3 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · 2 of 10 yrs

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $1.32/share (latest year $1.37), the averaged base the calculator's gate runs on, and book value is $7.68/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 7 of 10

What this means
Lost money in 3 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 2 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin −1% → 11% (3-yr avg ends)

What this means
Through the cycle the operating margin widened — about −1% early to 11% lately, median 10% — pricing power intact or improving.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Owner earnings growth +16%/yr

What this means
Owner earnings grew about 16% a year over the record.
Worst year 2017 · −6.9% op. margin

What this means
Operations went underwater in 2017, understand why before trusting the good years.
Share count −0.7%/yr

What this means
The share count is shrinking, buybacks are quietly growing your slice of the business.
Dividend record paid

What this means
Paid a dividend in 2 of the years on record.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing A competitive risk, new this year

Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“To the extent Mattel incorporates AI into its business and products, challenges with properly managing its use could result in reputational harm, competitive harm, and legal liability and adversely affect Mattel's business, financial condition, and results of operations.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat, and the company is using it that way.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$2.5B

Cash & short-term investments$866M
Receivables$687M
Inventory$677M
Other current assets$262M

Current liabilities$1.2B

Accounts payable$373M
Other current liabilities$837M

Current ratio2.06×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.50×stricter: inventory excluded

Cash ratio0.72×strictest: cash alone against what's due

Working capital$1.3Bthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+4.3%the freshest read on whether the business is still growing

Current ratio, recent quarters2.6× → 2.1×

Deeper floors

Tangible book value$36Mequity stripped of goodwill & intangibles

Debt incl. operating leases$2.7B$343M of it operating leases; with finance leases, “total fixed claims” below reaches $2.7B (annual-report basis)

Deferred revenue$114Mcustomer cash collected before delivery; operating float

From the company's latest filing.

Lease obligations

the lease note, SEC EDGAR →

Debt by another name. What the business owes on the property, aircraft, stores and equipment it rents rather than owns is a fixed claim due on a schedule; added back to the debt, it is the true leverage. That ladder, and what it adds to the debt on the page above.

'26$106M

'27$77M

'28$57M

'29$45M

'30$43M

later$115M

Lease payments by year, scaled to the largest; “later” is everything beyond year five, shown apart. These are the contractual cash payments, before the interest the filing imputes back out to the balance-sheet liability.

Due in the next 12 months$106Ma fixed cash payment, owed whether or not the business has a good year

Total lease payments$442Mevery year plus the tail, undiscounted: the full cash the leases will take

On the balance sheet$352Mthe present value of those payments, the recognised lease liability

True leverage: debt plus leases

On-balance-sheet debt$2.3B

Lease obligations (present value)$352M

Total fixed claims on the business$2.7B

Counting the leases the way Buffett does, the fixed claims on this business come to $2.7B, of which the leases are 13%. The lease wall above and the debt schedule together are the calendar of what must be paid, and when.

Lease ladder read from the ASC 842 tags in the company’s Dec 31, 2025 annual report and reconciled: the yearly buckets sum to the undiscounted total, which less the imputed interest equals the balance-sheet liability; a ladder that doesn’t tie out is withheld.

How the cash was used, 2016–2025

Over the record, the business generated $4.2B of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.

Reinvested$969M · 23%
Dividends$831M · 20%
Buybacks$1.2B · 29%
Retained (debt / cash)$1.2B · 28%

Returned to owners$2.0B
63% of the owner earnings the business produced over the span, $831M as dividends and $1.2B as buybacks.
Average price paid for buybacks—
Buybacks ran $1.2B over the span, but the filings don't tag the share count needed to deduce the average price paid.
Net change in share count−12.6%
The diluted count fell from 344M to 301M, so the buybacks outran the stock issued to staff.
Dividend record$0.00/sh
Paid in 2 of the years on record. It was cut at least once along the way.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$1.7B26% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity62%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$33Mover 10 years buying other businesses, against $969M of capital spent building

None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Mr. Kreiz	$16.1M	$26.7M	$408M
2022	Mr. Kreiz	$11.9M	−$6.7M	$337M
2023	Mr. Kreiz	$18.9M	$30.8M	$784M
2024	Mr. Kreiz	$37.8M	$31.4M	$665M
2025	Mr. Kreiz	$15.1M	$17.6M	$483M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership1.9%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio2,105:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$80M
The slice of the business handed to employees in shares this year, 1% of revenue, equal to 15% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Mattel is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

1 of the 6 tests turned up something to look into; the other 5 came back clean.

Look hereAre "one-time" charges a yearly habit?5 of 10 years
Management took an impairment or write-down in 5 of the last 10 years, $138M in all. Taken across the majority of the record, the "one-time" label is wearing thin — ask whether these are past deals coming due rather than genuinely isolated events. Read it beside the goodwill the company still carries.

And these came back clean

Is it less profitable than it was?
Did the share count rise anyway?
Did debt outgrow the business?
Did reported profit become cash?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

How much of the revenue rides on one buyer?
≈$2.3B · 42% of revenue on the largest customers (TTM)
“During 2025, Mattel's three largest customers (Walmart at $1.08 billion, Target at $0.63 billion, and Amazon at $0.52 billion) accounted for approximately 42% of worldwide consolidated net sales.”verify →
Which reported numbers are a judgment call?
Management names Income taxes as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Leisure Products

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
MATMattel	$5.3B	47%	9.9%	11%	7%
HASHasbro Inc.	$4.7B	67%	10.5%	12%	12%
GOLFAcushnet Holdings Corp.	$2.6B	51%	11.4%	12%	7%
PTONPeloton Interactive Inc.	$2.5B	43%	-15.3%	-10%	-5%
CALYCallaway Golf Company	$2.1B	44%	6.9%	7%	8%
YETIYETI Holdings	$1.9B	54%	11.4%	30%	12%
BRCBrady Corporation	$1.5B	50%	14.6%	17%	12%
FNKOFunko Inc.	$908M	36%	4.7%	6%	5%
Group median	—	48%	10.2%	11%	8%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Mattel has delivered.

Mattel’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Mattel earns about $366M on its 6.8% median owner-earnings margin. This year’s 9.0% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($366M) Net of stock comp (−$73M) Steady-state · maintenance capex ($435M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25+11%/yr

Owner-earnings growth · ’16→’25+16%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $411M on 291M shares outstanding, per the 10-Q cover, as of 2026-04-21; net debt $1.5B. The if-converted diluted count is 301M, 4% above the shares outstanding: the dilution overhang (convertibles, options) a buyer inherits. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. Capex ($135M) runs well above depreciation ($170M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $435M, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh MAT against another business →

Cite: Owner Scorecard, "Mattel (MAT), the owner's record," https://ownerscorecard.com/c/MAT, data as of 2026-07-09.

Manual order: ← MASS its page in the Manual MATV →

Industry order: ← KMRK the Leisure Products chapter PII →