If Mattel (MAT - Get Report) wants to stay alive, it may want to get moving on slashing costs. To be sure, it has a big opportunity to do so. 

UBS' research team points out that Mattel's top line sales are 25% lower from their 2013 peak, yet costs and operating expenses are only down 4% during that stretch. One sign of the waste that is ripe for cleanup: UBS estimates that Mattel has 8,000 vendors that are paid $25,000 or less. The company would be wise to consolidate its vendor base to extract cost savings, UBS suggests. 

At least Mattel's new CEO Margo Georgiadis, a former Google (GOOGL - Get Report) executive, is aware of the opportunity and looks ready to act. After meeting with management, UBS believes Mattel's net cost savings guidance of $515 million by 2020 could prove conservative. 

Mattel said it lost $281.3 million in the fourth quarter vs. a $173.8 million profit in the same period a year ago. For 2017 as a whole, Mattel lost a dizzying $1.05 billion, down sharply from a 2016 profit of $318 million.

Shares of the Barbie and Hot Wheels toy maker have plunged 36% over the past year.

The company faced headwinds on many other fronts last year, including a recent Chapter 11 filing and massive store closings by retailer Toys "R" Us. The chain reportedly accounted for some 20% of Mattel's U.S. sales and 11% of sales internationally.

In addition, Mattel blamed poor North American results on tighter retailer inventory management and "certain under-performing brands." The company said that internationally, results suffered from "inventory-management efforts, unfavorable product mix, and higher freight and logistics expenses."

-Michelle Lodge contributed to this story.

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