Mattel (MAT) - Get Mattel, Inc. Report stock jumped on Friday, climbing more than 6% in premarket trading after the toy maker raised its 2021 sales forecast, saying higher prices resulting from ongoing supply disruptions aren’t deterring consumers from spending on the likes of Barbie, Hot Wheels and Star Wars-branded holiday gifts.
Mattel stock was up 6.4% in premarket trading on Friday after the company posted third-quarter net sales of $1.76 billion, an 8% gain over the year-earlier quarter, aided by higher prices and as customers looking to keep their children entertained during the pandemic.
Analysts polled by FactSet had estimated sales of $1.69 billion. On an adjusted basis, Mattel earned 84 cents a share, beating estimates of 72 cents a share.
While demand for toys is at an all-time high, severe global supply chain bottlenecks have threatened to keep store shelves bare this holiday season, leaving retailers and suppliers scrambling for ways to speed up product shipments.
Even so, Mattel CEO Ynon Kreiz said the company has already taken supply chain issues into account and has pulled forward production, added more freight capacity and secured access to additional ports to ensure its supply keeps up with demand from retailers and consumers.
"We've been working through supply chain disruptions, it's not a normal year. But even with that, we expect to have lots of toys under trees this Christmas holiday," Kreiz told Reuters in a post-earnings interview.
Mattel said it now expects net sales to increase by approximately 15% over last year, up from its previous guidance range of between 12% and 14%. The company left its adjusted gross margin guidance unchanged at a range of 47.6% to 48.1%.
At last check, shares of Mattel were up 6.74% at $21.70. The stock is up nearly 18% year to date.