Mattel (MAT) Slipped Due to Unexpected Incremental Spending

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Soumya Eswaran

Mon, May 18, 2026 astatine 8:27 AM CDT 3 min read

Longleaf Partners, managed by Southeastern Asset Management, released its first-quarter 2026 capitalist letter. A transcript of the missive is disposable to download here. The Fund returned -4.46% successful the quarter, compared to the S&P 500’s -4.33% and the Russell 1000 Value Index’s 2.10% return. The twelvemonth began likewise to the 2nd fractional of 2025, with rising stocks and penalization for caution. February was marked by antithetic sector-wide movements influenced by perceived AI outcomes. Complications arose from the Iran War and expanding backstage recognition risks. The Fund initially lagged the market, but show improved arsenic conditions worsened. The money ended the 4th with a P/V of mid-50s%, which bodes good for promising aboriginal returns. In addition, delight cheque the Fund’s apical 5 holdings to cognize its champion picks successful 2026.

In its first-quarter 2026 capitalist letter, Longleaf Partners Fund highlighted stocks similar Mattel, Inc. (NASDAQ:MAT). Mattel, Inc. (NASDAQ:MAT) is simply a multinational artifact and amusement institution specializes successful manufactures and markets toys, games, and different products. On May 15, 2026, Mattel, Inc. (NASDAQ:MAT) closed astatine $15.15 per share. One-month instrumentality of Mattel, Inc. (NASDAQ:MAT) was 1.61%, and its shares mislaid 24.25% implicit the past 52 weeks. Mattel, Inc. (NASDAQ:MAT) has a marketplace capitalization of $4.40 billion.

Longleaf Partners Fund stated the pursuing regarding Mattel, Inc. (NASDAQ:MAT) successful its Q1 2026 capitalist letter:

"Mattel, Inc. (NASDAQ:MAT) – Children’s toy, media, and user products creator Mattel was a detractor successful the quarter. The banal fell owed to an unexpected $150 cardinal (15% of EBITDA) successful incremental spending connected initiatives including mobile gaming, Brick Shop (Mattel’s rival to LEGO), and nonstop to user marketing. CEO Ynon Kreiz cited a 1 twelvemonth payback connected this spend, but the marketplace remains successful show-me mode and the terms declined proportionate to the 2026 net per stock guidance reduction. This was compounded by 4Q results that missed expectations, particularly successful the US. To the positive, the institution committed to $1.5 cardinal successful stock repurchase implicit the adjacent 3 years, which equates to 33% of shares outstanding astatine today’s price. 2026 should person demonstrated the existent FCF powerfulness of Mattel fixed traction connected IP initiatives including 2 caller movies (Masters of the Universe and Matchbox), 2 caller mobile crippled launches, and licensing momentum with Toy Story 5 and KPop Demon Hunters. Unfortunately, this was delayed, and we are focused connected what we tin bash to amended this situation."

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