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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 ___________________________________________________________ 
FORM 10-Q
 ___________________________________________________________ 
(Mark One)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
September 30, 2024
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                     to  
Commission File Number 001-05647
___________________________________________________________ 
MATTEL, INC.
(Exact name of registrant as specified in its charter)
___________________________________________________________ 
Delaware 95-1567322
(State or other jurisdiction of
incorporation or organization)		 (I.R.S. Employer
Identification No.)
333 Continental Blvd. 90245-5012
El Segundo,CA 
(Address of principal executive offices) (Zip Code)
(310) 252-2000
(Registrant's telephone number, including area code)
NONE
(Former name, former address and former fiscal year, if changed since last report)

__________________________________________________________ 

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, $1.00 per shareMATThe Nasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. 
Large accelerated filer ☒  Accelerated filer 
☐
Non-accelerated filer 
☐
  Smaller reporting company 
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒
Number of shares outstanding of registrant's common stock, $1.00 par value, as of October 14, 2024: 336.9 million shares
1

MATTEL, INC. AND SUBSIDIARIES
2

(Cautionary Note Regarding Forward-Looking Statements)
Mattel cautions investors that this Quarterly Report on Form 10-Q includes forward-looking statements, which are statements that relate to the future and are, by their nature, uncertain. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. The use of words such as "anticipates," "expects," "intends," "plans," "projects," "looks forward," "confident that," "believes," and "targeted," among others, generally identify forward-looking statements. These forward-looking statements are based on currently available operating, financial, economic, and other information and assumptions, and are subject to a number of significant risks and uncertainties. A variety of factors, many of which are beyond Mattel's control, could cause actual future results to differ materially from those projected in the forward-looking statements. Specific factors that might cause such a difference include, but are not limited to: (i) Mattel's ability to design, develop, produce, manufacture, source, ship, and distribute products on a timely and cost-effective basis; (ii) sufficient interest in and demand for the products and entertainment Mattel offers by retail customers and consumers to profitably recover Mattel's costs; (iii) downturns in economic conditions affecting Mattel's markets which can negatively impact retail customers and consumers, and which can result in lower employment levels and lower consumer disposable income and spending, including lower spending on purchases of Mattel's products; (iv) other factors which can lower discretionary consumer spending, such as higher costs for fuel and food, drops in the value of homes or other consumer assets, and high levels of consumer debt; (v) potential difficulties or delays Mattel may experience in implementing cost savings and efficiency enhancing initiatives; (vi) other economic and public health conditions or regulatory changes in the markets in which Mattel and its customers and suppliers operate, which could create delays or increase Mattel's costs, such as higher commodity prices, labor costs or transportation costs, or outbreaks of disease; (vii) the effect of inflation on Mattel's business, including cost inflation in supply chain inputs and increased labor costs, as well as pricing actions taken in an effort to mitigate the effects of inflation; (viii) currency fluctuations, including movements in foreign exchange rates, which can lower Mattel's net revenues and earnings, and significantly impact Mattel's costs; (ix) the concentration of Mattel's customers, potentially increasing the negative impact to Mattel of difficulties experienced by any of Mattel's customers, such as bankruptcies or liquidations or a general lack of success, or changes in their purchasing or selling patterns; (x) the inventory policies of Mattel's retail customers, as well as the concentration of Mattel's revenues in the second half of the year, which coupled with reliance by retailers on quick response inventory management techniques, increases the risk of underproduction, overproduction, and shipping delays; (xi) legal, reputational, and financial risks related to security breaches or cyberattacks; (xii) work disruptions, including as a result of supply chain disruption such as plant or port closures, which may impact Mattel's ability to manufacture or deliver product in a timely and cost-effective manner; (xiii) the impact of competition on revenues, margins, and other aspects of Mattel's business, including the ability to offer products that consumers choose to buy instead of competitive products, the ability to secure, maintain, and renew popular licenses from licensors of entertainment properties, and the ability to attract and retain talented employees and adapt to evolving workplace models; (xiv) the risk of product recalls or product liability suits and costs associated with product safety regulations; (xv) changes in laws or regulations in the United States and/or in other major markets, such as China, in which Mattel operates, including, without limitation, with respect to taxes, tariffs, trade policies, product safety, or sustainability, which may increase Mattel's product costs and other costs of doing business, and reduce Mattel's earnings and liquidity; (xvi) business disruptions or other unforeseen impacts due to economic instability, political instability, civil unrest, armed hostilities (including the impact of the war in Ukraine and geopolitical developments in the Middle East), natural and man-made disasters, pandemics or other public health crises, or other catastrophic events; (xvii) failure to realize the planned benefits from any investments or acquisitions made by Mattel; (xviii) the impact of other market conditions or third-party actions or approvals, including those that result in any significant failure, inadequacy, or interruption from vendors or outsourcers, which could reduce demand for Mattel's products, delay or increase the cost of implementation of Mattel's programs, or alter Mattel's actions and reduce actual results; (xix) changes in financing markets or the inability of Mattel to obtain financing on attractive terms; (xx) the impact of litigation, arbitration, or regulatory decisions or settlement actions; (xxi) Mattel's ability to navigate regulatory frameworks in connection with new areas of investment, product development, or other business activities, such as artificial intelligence, non-fungible tokens, and cryptocurrency; (xxii) an inability to remediate the material weakness in Mattel's internal control over financial reporting, or additional material weaknesses or other deficiencies in the future or the failure to maintain an effective system of internal control; and (xxiii) other risks and uncertainties detailed in Part I, Item 1A "Risk Factors" in Mattel's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the "2023 Annual Report on Form 10-K"), and subsequent periodic filings. Mattel does not update forward-looking statements and expressly disclaims any obligation to do so, except as required by law.

3

PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
MATTEL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
September 30,
2024		September 30,
2023		December 31,
2023
 (Unaudited; in thousands, except share data)
ASSETS
Current Assets
Cash and equivalents$723,532 $455,735 $1,261,363 
Accounts receivable, net of allowances for credit losses of $8.2 million, $12.5 million, and $8.8 million, respectively
1,477,364 1,571,047 1,081,827 
Inventories737,182 790,521 571,609 
Prepaid expenses and other current assets242,302 224,796 207,548 
Total current assets3,180,380 3,042,099 3,122,347 
Noncurrent Assets
Property, plant, and equipment, net513,769 457,202 465,523 
Right-of-use assets, net277,627 286,019 313,191 
Goodwill1,388,991 1,380,042 1,384,512 
Deferred income tax assets260,180 230,415 299,157 
Intangible assets, net374,706 397,821 393,039 
Other noncurrent assets518,080 450,956 458,053 
Total Assets$6,513,733 $6,244,554 $6,435,822 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable$439,203 $450,109 $442,286 
Accrued liabilities803,204 803,081 866,283 
Income taxes payable56,212 51,366 33,911 
Total current liabilities1,298,619 1,304,556 1,342,480 
Noncurrent Liabilities
Long-term debt2,333,260 2,328,897 2,329,986 
Noncurrent lease liabilities229,223 234,699 259,548 
Other noncurrent liabilities339,685 340,936 354,595 
Total noncurrent liabilities2,902,168 2,904,532 2,944,129 
Stockholders' Equity
Common stock $1.00 par value, 1.00 billion shares authorized; 441.4 million shares issued
441,369 441,369 441,369 
Additional paid-in capital1,759,000 1,745,170 1,774,911 
Treasury stock at cost: 104.5 million shares, 88.1 million shares, and 92.9 million shares, respectively
(2,434,734)(2,131,676)(2,224,160)
Retained earnings3,463,016 2,914,744 3,062,061 
Accumulated other comprehensive loss(915,705)(934,141)(904,968)
Total stockholders' equity2,312,946 2,035,466 2,149,213 
Total Liabilities and Stockholders' Equity$6,513,733 $6,244,554 $6,435,822 
The accompanying notes are an integral part of these consolidated financial statements.
4

MATTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
 For the Three Months EndedFor the Nine Months Ended
September 30,
2024		September 30,
2023		September 30,
2024		September 30,
2023
 (Unaudited; in thousands, except per share amounts)
Net Sales$1,843,904 $1,918,788 $3,733,141 $3,820,531 
Cost of sales864,908 940,854 1,834,539 2,027,004 
Gross Profit978,996 977,934 1,898,602 1,793,527 
Advertising and promotion expenses104,956 124,265 250,117 290,337 
Other selling and administrative expenses385,699 379,811 1,112,455 1,081,594 
Operating Income488,341 473,858 536,030 421,596 
Interest expense29,371 30,716 89,415 92,486 
Interest (income)(9,787)(4,569)(39,466)(15,409)
Other non-operating (income) expense, net(2,924)(2,391)8,796 (5,976)
Income Before Income Taxes471,681 450,102 477,285 350,495 
Provision for income taxes106,350 309,342 94,756 296,767 
(Income) from equity method investments(7,045)(5,559)(18,426)(13,306)
Net Income$372,376 $146,319 $400,955 $67,034 
Net Income Per Common Share - Basic$1.10 $0.41 $1.17 $0.19 
Weighted-average number of common shares339,059 354,139 342,707 354,559 
Net Income Per Common Share - Diluted$1.09 $0.41 $1.16 $0.19 
Weighted-average number of common and potential common shares341,216 357,474 345,380 357,977 
The accompanying notes are an integral part of these consolidated financial statements.
5

MATTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
 For the Three Months EndedFor the Nine Months Ended
 September 30,
2024		September 30,
2023		September 30,
2024		September 30,
2023
 (Unaudited; in thousands)
Net Income$372,376 $146,319 $400,955 $67,034 
Other Comprehensive Income (Loss), Net of Tax
Currency translation adjustments24,442 (39,273)(16,885)(8,992)
Employee benefit plan adjustments994 664 3,441 2,120 
Net unrealized gains (losses) on derivative instruments:
Unrealized holding (losses) gains(13,288)7,521 9,764 (1,729)
Reclassification adjustments included in net income7,264 (5,801)(7,057)(14,062)
(6,024)1,720 2,707 (15,791)
Other Comprehensive Income (Loss), Net of Tax19,412 (36,889)(10,737)(22,663)
Comprehensive Income$391,788 $109,430 $390,218 $44,371 

The accompanying notes are an integral part of these consolidated financial statements.
6

MATTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended
September 30,
2024		September 30,
2023
 (Unaudited; in thousands)
Cash Flows From Operating Activities:
Net income$400,955 $67,034 
Adjustments to reconcile net income to net cash flows used for operating activities:
Depreciation101,682 104,042 
Amortization of intangible assets23,503 28,570 
Share-based compensation57,448 52,425 
Inventory obsolescence30,023 42,245 
Deferred income taxes23,020 26,283 
Income from equity method investments(18,426)(13,306)
Valuation allowance on foreign deferred tax assets3,200 212,379 
Content assets amortization62,333 32,938 
Changes in assets and liabilities:
Accounts receivable, net(408,662)(714,198)
Inventories(201,954)42,701 
Prepaid expenses and other current assets(42,695)(4,768)
Accounts payable, accrued liabilities, and income taxes payable(32,262)121,202 
Content assets spend(16,944)(47,111)
Other, net(42,804)(30,077)
Net cash flows used for operating activities(61,583)(79,641)
Cash Flows From Investing Activities:
Purchases of tools, dies, and molds(48,337)(56,741)
Purchases of other property, plant, and equipment(108,598)(60,797)
Proceeds from foreign currency forward exchange contracts, net1,578 20,021 
Other, net3,617 3,605 
Net cash flows used for investing activities(151,740)(93,912)
Cash Flows From Financing Activities:
Share repurchases(268,307)(109,860)
Tax withholdings for share-based compensation (17,375)(32,822)
Proceeds from stock option exercises6,184 26,014 
Other, net(34,730)(2,783)
Net cash flows used for financing activities(314,228)(119,451)
Effect of Currency Exchange Rate Changes on Cash and Equivalents(10,280)(12,496)
Change in Cash and Equivalents(537,831)(305,500)
Cash and Equivalents at Beginning of Period1,261,363 761,235 
Cash and Equivalents at End of Period$723,532 $455,735 
The accompanying notes are an integral part of these consolidated financial statements.
7

MATTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Common
Stock		Additional
Paid-In
Capital		Treasury
Stock		Retained
Earnings		Accumulated
Other
Comprehensive
Loss		Total
Stockholders'
Equity
 (Unaudited; in thousands)
Balance, December 31, 2023$441,369 $1,774,911 $(2,224,160)$3,062,061 $(904,968)$2,149,213 
Net loss— — — (28,281)— (28,281)
Other comprehensive loss, net of tax— — — — (10,765)(10,765)
Share repurchases— — (100,758)— — (100,758)
Issuance of treasury stock for stock option exercises— (2,754)7,053 — — 4,299 
Issuance of treasury stock for restricted stock units vesting— (17,932)11,607 — — (6,325)
Share-based compensation— 17,929 — — — 17,929 
Balance, March 31, 2024$441,369 $1,772,154 $(2,306,258)$3,033,780 $(915,733)$2,025,312 
Net income— — — 56,860 — 56,860 
Other comprehensive loss, net of tax— — — — (19,384)(19,384)
Share repurchases— — (100,954)— — (100,954)
Issuance of treasury stock for stock option exercises— (437)953 — — 516 
Issuance of treasury stock for restricted stock units vesting— (35,743)26,692 — — (9,051)
Deferred compensation— (148)148 — — — 
Share-based compensation— 19,834 — — — 19,834 
Balance, June 30, 2024$441,369 $1,755,660 $(2,379,419)$3,090,640 $(935,117)$1,973,133 
Net income— — — 372,376 — 372,376 
Other comprehensive income, net of tax— — — — 19,412 19,412 
Share repurchases— — (68,907)— — (68,907)
Issuance of treasury stock for stock option exercises— (1,186)2,556 — — 1,370 
Issuance of treasury stock for restricted stock units vesting— (15,159)11,036 — — (4,123)
Share-based compensation— 19,685 — — — 19,685 
Balance, September 30, 2024$441,369 $1,759,000 $(2,434,734)$3,463,016 $(915,705)$2,312,946 
Common
Stock		Additional
Paid-In
Capital		Treasury
Stock		Retained
Earnings		Accumulated
Other
Comprehensive
Loss		Total
Stockholders'
Equity
 (Unaudited; in thousands)
Balance, December 31, 2022$441,369 $1,808,308 $(2,129,639)$2,847,709 $(911,478)$2,056,269 
Net loss— — — (106,471)— (106,471)
Other comprehensive income, net of tax— — — — 23,160 23,160 
Share repurchases— — (33,986)— — (33,986)
Issuance of treasury stock for stock option exercises— (1,144)3,189 — — 2,045 
Issuance of treasury stock for restricted stock units vesting— (51,311)31,012 — — (20,299)
Share-based compensation— 16,943 — — — 16,943 
Balance, March 31, 2023$441,369 $1,772,796 $(2,129,424)$2,741,238 $(888,318)$1,937,661 
Net income— — — 27,187 — 27,187 
Other comprehensive loss, net of tax— — — — (8,934)(8,934)
Share repurchases— — (15,875)— — (15,875)
Issuance of treasury stock for stock option exercises— (4,075)10,670 — — 6,595 
Issuance of treasury stock for restricted stock units vesting— (18,079)13,698 — — (4,381)
Deferred compensation— (36)166 — — 130 
Share-based compensation— 19,991 — — — 19,991 
Balance, June 30, 2023$441,369 $1,770,597 $(2,120,765)$2,768,425 $(897,252)$1,962,374 
Net income— — — 146,319 — 146,319 
Other comprehensive loss, net of tax— — — — (36,889)(36,889)
Share repurchases— — (60,000)— — (60,000)
Issuance of treasury stock for stock option exercises— (10,095)27,469 — — 17,374 
Issuance of treasury stock for restricted stock units vesting— (30,824)21,620 — — (9,204)
Share-based compensation— 15,492 — — — 15,492 
Balance, September 30, 2023$441,369 $1,745,170 $(2,131,676)$2,914,744 $(934,141)$2,035,466 
The accompanying notes are an integral part of these consolidated financial statements.
8

MATTEL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1.     Basis of Presentation
The accompanying unaudited consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair statement of the financial position and interim results of Mattel, Inc. and its subsidiaries ("Mattel") as of and for the periods presented have been included.
The December 31, 2023 balance sheet data was derived from audited financial statements; however, the accompanying interim notes to the consolidated financial statements do not include all of the annual disclosures required by GAAP. As Mattel's business is seasonal, results for interim periods are not necessarily indicative of those that may be expected for a full year. The financial information included herein should be read in conjunction with Mattel's consolidated financial statements and related notes in the 2023 Annual Report on Form 10-K.
Certain prior period amounts have been reclassified to conform to the current period presentation.
2.     Accounts Receivable, Net
Mattel estimates current expected credit losses based on collection history and management's assessment of the current economic trends, business environment, customers' financial condition, and accounts receivable aging that may impact the level of future credit losses. Accounts receivable were net of allowances for credit losses of $8.2 million, $12.5 million, and $8.8 million as of September 30, 2024, September 30, 2023, and December 31, 2023, respectively.
3.     Inventories
Inventories included the following:
September 30,
2024		September 30,
2023		December 31,
2023
 (In thousands)
Raw materials and work in process$109,335 $102,582 $92,902 
Finished goods627,847 687,939 478,707 
$737,182 $790,521 $571,609 
4.     Property, Plant, and Equipment, Net
Property, plant, and equipment, net included the following: 
September 30,
2024		September 30,
2023		December 31,
2023
 (In thousands)
Land$42,924 $19,566 $19,838 
Buildings357,969 311,030 313,750 
Machinery and equipment641,999 623,687 628,089 
Software234,928 232,995 233,224 
Tools, dies, and molds501,220 494,070 488,170 
Leasehold improvements120,929 123,240 121,571 
Construction in progress42,243 39,533 48,483 
1,942,212 1,844,121 1,853,125 
Less: accumulated depreciation(1,428,443)(1,386,919)(1,387,602)
$513,769 $457,202 $465,523 
9

In July 2024, Mattel completed the purchase of an office building located in El Segundo, California for cash consideration of approximately $59 million. The building totals approximately 168,000 square feet and, upon completion of an interior build-out, will replace a currently leased facility that supports Mattel's global design and development and other activities. The building will support the North America and International segments.
5.     Goodwill and Intangible Assets, Net
Goodwill
Goodwill is allocated to various reporting units for the purpose of evaluating whether goodwill is impaired. Mattel's reporting units are: (i) North America; (ii) American Girl; and (iii) International. Components of the reporting units have been aggregated into single reporting units where the components have similar economic characteristics. The similar economic characteristics include the nature of the products, the nature of the production processes, the customers, and the manner in which the products are distributed. Mattel tests its goodwill for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying amount of a reporting unit may exceed its fair value.
Mattel performed a quantitative goodwill impairment assessment as of August 1, 2024, and determined that goodwill was not impaired. The quantitative goodwill impairment assessment includes the use of certain assumptions and estimates to calculate the estimated fair value of Mattel’s reporting units. To the extent assumptions, estimations, or market factors, including seasonality, differ from Mattel’s current estimates, the estimated fair value of Mattel’s reporting units may be susceptible to significant changes. The reporting unit that is most susceptible to changes in assumptions and estimates given its smaller size is American Girl, as excess fair value over carrying value is a lesser dollar and percentage value than the other reporting units.
The change in the carrying amount of goodwill by reporting unit for the nine months ended September 30, 2024 is shown below. Brand-specific goodwill held by foreign subsidiaries is allocated to the North America reporting unit selling those brands, resulting in a foreign currency exchange rate impact.
 December 31,
2023		Currency
Exchange Rate
Impact		September 30,
2024
(In thousands)
North America$733,487 $1,490 $734,977 
American Girl207,571 — 207,571 
International443,454 2,989 446,443 
$1,384,512 $4,479 $1,388,991 
Intangible Assets, Net
Identifiable intangible assets were $374.7 million, net of accumulated amortization of $435.1 million, $397.8 million, net of accumulated amortization of $396.8 million, and $393.0 million, net of accumulated amortization of $408.5 million as of September 30, 2024, September 30, 2023, and December 31, 2023, respectively.
Mattel's amortizable intangible assets primarily consist of trademarks and trade names. Mattel tests its amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Mattel's amortizable intangible assets were not impaired during the three and nine months ended September 30, 2024 and 2023.
6.     Accrued Liabilities
Accrued liabilities included the following:
September 30,
2024		September 30,
2023		December 31,
2023
 (In thousands)
Incentive compensation$104,136 $89,142 $143,091 
Royalties80,141 74,801 86,475 
Lease liabilities74,871 76,021 77,254 
Advertising and promotion71,993 105,218 102,217 
10

7.     Supplier Finance Program
Mattel has an agreement with a third-party financial institution that allows certain participating suppliers the opportunity to voluntarily finance payment obligations of Mattel under a supplier finance program. Under this program, participating suppliers may accelerate the timing of collection of their receivables due from Mattel, prior to their scheduled due dates, by selling one or more of their receivables at a discounted price to the third-party financial institution. The range of payment terms Mattel negotiates with suppliers are consistent, regardless of whether the suppliers participate in the supplier finance program and Mattel does not have any economic interest in any suppliers' decision to participate in the supplier finance program. Suppliers participating in the program are able to select which individual Mattel invoices they sell to the third-party financial institution. All Mattel payments of the full amounts due to participating suppliers are paid on the invoice due date based on the terms originally negotiated with the supplier, regardless of whether the individual invoice due to the supplier is sold to the third-party financial institution. Included in Mattel's accounts payable in the consolidated balance sheets as of each of September 30, 2024, September 30, 2023, and December 31, 2023 were $112.3 million, $90.5 million, and $54.3 million of outstanding payment obligations due to suppliers, respectively, under the supplier finance program. All payment activities related to the supplier finance program were presented within operating activities in the consolidated statements of cash flows.
8.     Seasonal Financing
On July 15, 2024, Mattel entered into a revolving credit agreement (the "New Credit Agreement"), among Mattel, as the borrower, Bank of America, N.A., as administrative agent, and the other lenders and financial institutions party thereto, providing for $1.40 billion in aggregate principal amount of senior unsecured revolving credit facilities (the "New Revolving Credit Facility"). The New Revolving Credit Facility matures on July 15, 2029. In connection with the New Revolving Credit Facility, Mattel terminated the commitments and satisfied all outstanding obligations under the revolving credit agreement (the "Prior Credit Agreement"), dated as of September 15, 2022 (as amended), among Mattel, as the borrower, Bank of America, N.A., as administrative agent, and the other lenders and financial institutions party thereto, which provided for a senior secured revolving credit facility in an aggregate principal amount of $1.40 billion (the "Prior Revolving Credit Facility").
As of September 30, 2024, Mattel was in compliance with all covenants contained in the New Credit Agreement. Mattel had no borrowings outstanding under the New Revolving Credit Facility and no other short-term borrowings outstanding as of September 30, 2024. Under the Prior Revolving Credit Facility, Mattel had no borrowings outstanding and no other short-term borrowings outstanding as of September 30, 2023, and December 31, 2023. Outstanding letters of credit under the New Revolving Credit Facility totaled approximately $9 million as of September 30, 2024. Outstanding letters of credit under the Prior Revolving Credit Facility totaled approximately $9 million as of each of September 30, 2023, and December 31, 2023.
Borrowings under the New Revolving Credit Facility will bear interest at a floating rate, which for U.S. Dollar-denominated loans can be, at Mattel's option, either (a) Term SOFR (as defined in the New Credit Agreement), plus an applicable margin ranging from 0.875% to 1.375% per annum, or (b) Base Rate (as defined in the New Credit Agreement), plus an applicable margin ranging from 0.000% to 0.375% per annum, in each case, such applicable margins to be determined based on Mattel's debt rating.
In addition to paying interest on the outstanding principal under the New Revolving Credit Facility, Mattel will be required to pay (i) an unused line fee per annum of the average daily unused portion of the New Revolving Credit Facility, (ii) a letter of credit fronting fee based on a percentage of the aggregate face amount of outstanding letters of credit, and (iii) certain other customary fees and expenses of the lenders and agents.
The New Credit Agreement contains customary covenants, including, but not limited to, restrictions on Mattel's and its subsidiaries' ability to merge and consolidate with other companies, dispose of all or substantially all assets, incur indebtedness, or grant liens or other security interests on assets, in each case, subject to certain customary exceptions. No subsidiaries of Mattel were required to guarantee the New Revolving Credit Facility as of the closing date thereof.
The New Credit Agreement requires the maintenance of (a) an interest coverage ratio of not less than 2.75 to 1.00 as of the end of each fiscal quarter and (b) a total leverage ratio as of the end of each fiscal quarter, not to exceed (x) 3.75 to 1.00 with respect to fiscal quarters ending on March 31, June 30 and December 31 of each year, and (y) 4.00 to 1.00 with respect to fiscal quarters ending on September 30 of each year. The total leverage ratio financial covenant is subject to a step-up to 4.25 to 1.00, with respect to fiscal quarters in which certain material acquisitions are consummated, and for a period of four fiscal quarters thereafter, and subject to certain customary exceptions.
The New Credit Agreement is a material agreement, and failure to comply with its covenants may result in an event of default under the terms of the New Revolving Credit Facility. If Mattel were to default under the terms of the New Revolving Credit Facility, its ability to meet its seasonal financing requirements could be adversely affected.
11

9.     Long-Term Debt
Long-term debt included the following:
September 30,
2024		September 30,
2023		December 31,
2023
 (In thousands)
2010 Senior Notes due October 2040$250,000 $250,000 $250,000 
2011 Senior Notes due November 2041300,000 300,000 300,000 
2019 Senior Notes due December 2027600,000 600,000 600,000 
2021 Senior Notes due April 2026600,000 600,000 600,000 
2021 Senior Notes due April 2029600,000 600,000 600,000 
Debt issuance costs and debt discount(16,740)(21,103)(20,014)
$2,333,260 $2,328,897 $2,329,986 
Less: current portion— — — 
Total long-term debt$2,333,260 $2,328,897 $2,329,986 
Mattel's 2019 Senior Notes due 2027 were issued pursuant to an indenture dated November 20, 2019, and its 2021 Senior Notes due 2026 and 2021 Senior Notes due 2029 were issued pursuant to an indenture dated March 19, 2021. These indentures contain covenants that limit Mattel's (and some of its subsidiaries') ability to, among other things: (i) incur additional debt or issue certain preferred shares; (ii) pay dividends on or make other distributions in respect of their capital stock or make other restricted payments; (iii) make investments in unrestricted subsidiaries; (iv) create liens; (v) enter into certain sale/leaseback transactions; (vi) merge or consolidate, or sell, transfer or otherwise dispose of substantially all of their assets; and (vii) designate subsidiaries as unrestricted. The indentures also provided that certain of these covenants would be suspended if Mattel achieved a debt rating of BBB-, Baa3, and/or BBB- (or higher) from any two of S&P, Moody's, and Fitch, respectively, and no event of default has occurred.
In April 2023, S&P upgraded Mattel's credit rating from BB+ to BBB- and maintained a positive outlook, and in November 2022, Moody's upgraded Mattel's credit rating from Ba1 to Baa3. As a result of the upgraded credit ratings and no events of default, the covenants limiting Mattel's ability to incur additional debt or issue certain preferred shares, pay dividends on or make other distributions in respect of their capital stock or make other restricted payments, and make investments in unrestricted subsidiaries, and certain provisions of the covenant limiting Mattel's ability to merge or consolidate, or sell, transfer or otherwise dispose of substantially all of their assets, are suspended. If Mattel ceases to have credit ratings of BBB-, Baa3, and/or BBB- (or higher) from any two of S&P, Moody's, and Fitch, respectively, Mattel will thereafter be subject to the suspended covenants with respect to future events.
10.     Accumulated Other Comprehensive Income (Loss)
The following tables present changes in the accumulated balances for each component of other comprehensive income (loss), including current period other comprehensive income (loss) and reclassifications from accumulated other comprehensive income (loss):
 For the Three Months Ended September 30, 2024
 Derivative
Instruments		Employee Benefit PlansCurrency
Translation
Adjustments		Total
 (In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2024$5,268 $(140,469)$(799,916)$(935,117)
Other comprehensive income (loss) before reclassifications(13,288)16 24,442 11,170 
Amounts reclassified from accumulated other comprehensive income (loss)7,264 978 — 8,242 
Net change in other comprehensive income (loss)(6,024)994 24,442 19,412 
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2024$(756)$(139,475)$(775,474)$(915,705)
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 For the Nine Months Ended September 30, 2024
 Derivative
Instruments		Employee Benefit PlansCurrency
Translation
Adjustments		Total
 (In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2023$(3,463)$(142,916)$(758,589)$(904,968)
Other comprehensive income (loss) before reclassifications9,764 50 (16,885)(7,071)
Amounts reclassified from accumulated other comprehensive income (loss)(7,057)3,391 — (3,666)
Net change in other comprehensive income (loss)2,707 3,441 (16,885)(10,737)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2024$(756)$(139,475)$(775,474)$(915,705)
 For the Three Months Ended September 30, 2023
 Derivative
Instruments		Employee Benefit PlansCurrency
Translation
Adjustments		Total
 (In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2023$5,221 $(137,042)$(765,431)$(897,252)
Other comprehensive income (loss) before reclassifications7,521 5 (39,273)(31,747)
Amounts reclassified from accumulated other comprehensive income (loss)(5,801)659 — (5,142)
Net change in other comprehensive income (loss)1,720 664 (39,273)(36,889)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2023$6,941 $(136,378)$(804,704)$(934,141)
 For the Nine Months Ended September 30, 2023
 Derivative
Instruments		Employee Benefit PlansCurrency
Translation
Adjustments		Total
 (In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2022$22,732 $(138,498)$(795,712)$(911,478)
Other comprehensive income (loss) before reclassifications(1,729)20 (8,992)(10,701)
Amounts reclassified from accumulated other comprehensive income (loss)(14,062)2,100 — (11,962)
Net change in other comprehensive income (loss)(15,791)2,120 (8,992)(22,663)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of September 30, 2023$6,941 $(136,378)$(804,704)$(934,141)


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The following tables present the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statements of operations:
For the Three Months Ended
September 30, 2024September 30, 2023Statements of Operations
Classification
(In thousands) 
Derivative Instruments:
(Loss) gain on foreign currency forward exchange and other contracts$(7,275)$5,784 Cost of sales
Tax effect11 17 Provision/benefit from income taxes
$(7,264)$5,801 Net income/loss
Employee Benefit Plans:
Amortization of prior service credit (a)$460 $472 Other non-operating income/expense, net
Recognized actuarial loss (a)(1,902)(1,410)Other non-operating income/expense, net
(1,442)(938)
Tax effect464 279 Provision/benefit from income taxes
$(978)$(659)Net income/loss
For the Nine Months Ended
September 30, 2024September 30, 2023Statements of Operations
Classification
(In thousands) 
Derivative Instruments:
Gain on foreign currency forward exchange and other contracts$7,023 $13,709 Cost of sales
Tax effect34 353 Provision/benefit from income taxes
$7,057 $14,062 Net income/loss
Employee Benefit Plans:
Amortization of prior service credit (a)$1,383 $1,416 Other non-operating income/expense, net
Recognized actuarial loss (a)(5,693)(4,229)Other non-operating income/expense, net
(4,310)(2,813)
Tax effect919 713 Provision/benefit from income taxes
$(3,391)$(2,100)Net income/loss
(a)The amortization of prior service credit and recognized actuarial loss are included in the computation of net periodic benefit cost. Refer to "Note 15 to the Consolidated Financial Statements—Employee Benefit Plans" for additional information regarding Mattel's net periodic benefit cost.
Currency Translation Adjustments
During the nine months ended September 30, 2024, currency translation adjustments resulted in a net loss of $16.9 million, primarily due to the weakening of the Mexican peso and Brazilian real against the U.S. dollar, partially offset by the strengthening of the British pound sterling against the U.S. dollar.
During the nine months ended September 30, 2023, currency translation adjustments resulted in a net loss of $9.0 million, primarily due to the weakening of the Russian ruble and Malaysian ringgit against the U.S. dollar, partially offset by the strengthening of the Mexican peso, British pound sterling, and Brazilian real against the U.S. dollar.
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11.     Foreign Currency Transaction Exposure
Currency transaction gains (losses) included in the consolidated statements of operations were as follows:
 For the Three Months Ended
 September 30,
2024		September 30,
2023		Statements of Operations Classification
 (In thousands)
Currency transaction (losses), net$(10,047)$(2,276)Operating income/expense
Currency transaction gains, net4,758 3,301 Other non-operating income/expense, net
Currency transaction (losses) gains, net$(5,289)$1,025 
 For the Nine Months Ended
 September 30,
2024		September 30,
2023		Statements of Operations Classification
 (In thousands)
Currency transaction (losses), net$(16,087)$(11,987)Operating income/expense
Currency transaction (losses) gains, net(226)5,390 Other non-operating income/expense, net
Currency transaction (losses), net$(16,313)$(6,597)
12.     Derivative Instruments
Mattel seeks to mitigate its exposure to foreign currency transaction risk by monitoring its foreign currency transaction exposure for the year and partially hedging such exposure using foreign currency forward exchange contracts. Mattel uses foreign currency forward exchange contracts as cash flow hedges primarily to hedge its purchases and sales of inventory denominated in foreign currencies. These contracts have maturity dates of up to 24 months. These derivative instruments have been designated as effective cash flow hedges, whereby the unsettled hedges are reported in Mattel's consolidated balance sheets at fair value, with changes in the fair value of the hedges reflected in other comprehensive income ("OCI"). Realized gains and losses for these contracts are recorded in the consolidated statements of operations in the period in which the inventory is sold to customers. Mattel uses foreign currency forward exchange contracts to hedge intercompany loans and advances denominated in foreign currencies. Due to the short-term nature of the contracts involved, Mattel does not use hedge accounting for these contracts, and as such, changes in fair value are recorded in the period of change in the consolidated statements of operations. Mattel utilizes derivative contracts to hedge certain purchases of commodities, which were not material. As of September 30, 2024, September 30, 2023, and December 31, 2023, Mattel held foreign currency forward exchange contracts and other commodity derivative instruments, with notional amounts of approximately $748 million, $636 million, and $609 million, respectively.
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The following tables present Mattel's derivative assets and liabilities:
 Derivative Assets
 Balance Sheet ClassificationFair Value
September 30,
2024		September 30,
2023		December 31,
2023
(In thousands)
Derivatives Designated as Hedging Instruments:
Foreign currency forward exchange and other contractsPrepaid expenses and other current assets$2,196 $13,308 $2,198 
Foreign currency forward exchange and other contractsOther noncurrent assets34 747 52 
Total Derivatives Designated as Hedging Instruments$2,230 $14,055 $2,250 
Derivatives Not Designated as Hedging Instruments:
Foreign currency forward exchange and other contractsPrepaid expenses and other current assets$1,251 $519 $578 
Total Derivatives Not Designated as Hedging Instruments$1,251 $519 $578 
$3,481 $14,574 $2,828 
 Derivative Liabilities
 Balance Sheet ClassificationFair Value
 September 30,
2024		September 30,
2023		December 31,
2023
(In thousands)
Derivatives Designated as Hedging Instruments:
Foreign currency forward exchange and other contractsAccrued liabilities$8,571 $1,997 $7,520 
Foreign currency forward exchange and other contractsOther noncurrent liabilities2,026 14 1,575 
Total Derivatives Designated as Hedging Instruments$10,597 $2,011 $9,095 
Derivatives Not Designated as Hedging Instruments:
Foreign currency forward exchange and other contractsAccrued liabilities$608 $323 $449 
Foreign currency forward exchange and other contractsOther noncurrent liabilities— — 20 
Total Derivatives Not Designated as Hedging Instruments$608 $323 $469 
$11,205 $2,334 $9,564 
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The following tables present the classification and amount of gains and losses, net of tax, from derivatives reported in the consolidated statements of operations:
Derivatives Designated as Hedging Instruments
For the Three Months Ended
 September 30,
2024		September 30,
2023		Statements of
Operations
Classification
 (In thousands)
Foreign Currency Forward Exchange and Other Contracts:
Amount of (losses) gains recognized in OCI$(13,288)$7,521 
Amount of (losses) gains reclassified from accumulated OCI to the consolidated statements of operations(7,264)5,801 Cost of sales
Derivatives Designated as Hedging Instruments
For the Nine Months Ended
 September 30,
2024		September 30,
2023		Statements of
Operations
Classification
 (In thousands)
Foreign Currency Forward Exchange and Other Contracts:
Amount of gains (losses) recognized in OCI$9,764 $(1,729)
Amount of gains reclassified from accumulated OCI to the consolidated statements of operations7,057 14,062 Cost of sales
The net gains reclassified from accumulated other comprehensive loss to the consolidated statements of operations during the three and nine months ended September 30, 2024 and 2023, respectively, were offset by changes in cash flows associated with the underlying hedged transactions.
 Derivatives Not Designated as Hedging Instruments
For the Three Months Ended
September 30,
2024		September 30,
2023		Statements of
Operations
Classification
 (In thousands)
Amount of Net Gains (Losses) Recognized in the Statements of Operations:
Foreign currency forward exchange and other contracts$1,845 $6,805 Other non-operating income/expense, net
 Derivatives Not Designated as Hedging Instruments
For the Nine Months Ended
September 30,
2024		September 30,
2023		Statements of
Operations
Classification
 (In thousands)
Amount of Net Gains (Losses) Recognized in the Statements of Operations:
Foreign currency forward exchange and other contracts$2,195 $25,083 Other non-operating income/expense, net
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The net gains and losses recognized in the consolidated statements of operations during the three and nine months ended September 30, 2024 and September 30, 2023, respectively, were offset by foreign currency transaction gains and losses on the related derivative balances.
13.     Fair Value Measurements
The following tables present information about Mattel's financial assets and liabilities measured and reported in the financial statements at fair value on a recurring basis as of September 30, 2024, September 30, 2023, and December 31, 2023 and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value. The three levels of the fair value hierarchy are as follows:
•Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
•Level 2 – Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.
•Level 3 – Valuations based on inputs that are unobservable, supported by little or no market activity, and that are significant to the fair value of the assets or liabilities.
September 30, 2024
Level 1Level 2Level 3Total
(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)$— $3,481 $— $3,481 
Liabilities:
Foreign currency forward exchange and other contracts (a)$— $11,205 $— $11,205 
September 30, 2023
Level 1Level 2Level 3Total
(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)$— $14,574 $— $14,574 
Liabilities:
Foreign currency forward exchange and other contracts (a)$— $2,334 $— $2,334 
December 31, 2023
Level 1Level 2Level 3Total
(In thousands)
Assets:
Foreign currency forward exchange and other contracts (a)$— $2,828 $— $2,828 
Liabilities:
Foreign currency forward exchange and other contracts (a)$— $9,564 $— $9,564 
(a)The fair value of the foreign currency forward exchange and other contracts was based on dealer quotes of market forward rates and reflects the amount that Mattel would receive or pay at their maturity dates for contracts involving the same notional amounts, currencies, and maturity dates.
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Other Financial Instruments
Mattel's financial instruments included cash and equivalents, accounts receivable and payable, accrued liabilities, short-term borrowings, and long-term debt. The fair values of these instruments, excluding long-term debt, approximate their carrying amounts because of their short-term nature. Cash and equivalents were classified as Level 1 and all other financial instruments were classified as Level 2 within the fair value hierarchy.
The estimated fair value of Mattel's long-term debt was $2.31 billion (compared to a carrying amount of $2.35 billion) as of September 30, 2024, $2.13 billion (compared to a carrying amount of $2.35 billion) as of September 30, 2023, and $2.23 billion (compared to a carrying amount of $2.35 billion) as of December 31, 2023. The estimated fair values have been calculated based on broker quotes or rates for the same or similar instruments and were classified as Level 2 within the fair value hierarchy.
14.     Earnings Per Share
The following table reconciles basic and diluted earnings per common share for the three and nine months ended September 30, 2024 and 2023: 
 For the Three Months EndedFor the Nine Months Ended
 September 30,
2024		September 30,
2023		September 30,
2024		September 30,
2023
 (In thousands, except per share amounts)
Basic:
Net income$372,376 $146,319 $400,955 $67,034 
Weighted-average number of common shares339,059 354,139 342,707 354,559 
Basic net income per common share$1.10 $0.41 $1.17 $0.19 
Diluted:
Net income$372,376 $146,319 $400,955 $67,034 
Weighted-average number of common shares339,059 354,139 342,707 354,559 
Dilutive share-based awards (a)2,157 3,335 2,673 3,418 
Weighted-average number of common and potential common shares341,216 357,474 345,380 357,977 
Diluted net income per common share$1.09 $0.41 $1.16 $0.19 
(a)For the three and nine months ended September 30, 2024, 6.9 million and 7.7 million share-based awards, respectively, were excluded from the calculation of diluted net income per common share because their effect would be antidilutive. For the three and nine months ended September 30, 2023, 6.5 million and 11.5 million share-based awards, respectively, were excluded from the calculation of diluted net income per common share because their effect would be antidilutive.
15.    Employee Benefit Plans
Mattel and certain of its subsidiaries have qualified and nonqualified retirement plans covering substantially all employees of these companies, which are more fully described in Part II, Item 8 "Financial Statements and Supplementary Data—Note 4 to the Consolidated Financial Statements–Employee Benefit Plans" in the 2023 Annual Report on Form 10-K.
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The components of Mattel's net periodic benefit cost for defined benefit pension plans were as follows:
 For the Three Months EndedFor the Nine Months Ended
 September 30,
2024		September 30,
2023		September 30,
2024		September 30,
2023
 (In thousands)
Service cost$851 $848 $2,548 $2,548 
Interest cost5,059 5,234 15,142 15,670 
Expected return on plan assets(4,693)(5,103)(14,052)(15,280)
Amortization of prior service cost49