8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report: July 19, 2004

MATTEL, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-05647	95-1567322
(State or other jurisdiction of corporation)	(Commission File No.)	(I.R.S. Employer Identification No.)

333 Continental Boulevard, El Segundo, California	90245-5012
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (310) 252-2000

N/A

(Former name or former address, if changed since last report)

Item 7.    Financial Statements and Exhibits.

(a)  Financial statements of businesses acquired: None

(b)  Pro forma financial information: None

(c)  Exhibits:

This exhibit is furnished pursuant to Items 9 and 12 hereof and should not be deemed to be “filed” under the Securities Exchange Act of 1934.

99.0 Press release dated July 19, 2004

Item 9.    Regulation FD Disclosure and

Item 12.    Disclosure of Results of Operations and Financial Condition.

On July 19, 2004, Mattel issued a press release regarding its 2004 second quarter results of operations, a copy of which is furnished as Exhibit 99.0 hereto. This exhibit is incorporated herein by reference.

In its 2004 second quarter press release, Mattel includes a non-GAAP financial measure, gross sales, which it uses to analyze its continuing operations and to monitor, assess and identify meaningful trends in its operating and financial performance.

Net sales, as reported in the consolidated statements of operations, include the impact of sales adjustments, such as trade discounts and other allowances. Gross sales represent sales to customers, excluding the impact of sales adjustments. Consistent with its segment reporting, Mattel presents changes in gross sales as a metric for comparing its aggregate, business unit and geographic results to highlight significant trends in Mattel’s business. Changes in gross sales are discussed because most sales adjustments are not allocated to individual brands, making net sales less meaningful. A reconciliation of gross sales to the most directly comparable GAAP financial measure, net sales, is provided in Exhibit II to the press release furnished as Exhibit 99.0 in this Form 8-K.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

MATTEL, INC. Registrant
By:	/s/    ROBERT NORMILE
	Robert Normile Senior Vice President, General Counsel and Secretary

Date: July 19, 2004

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EX-99.0

Exhibit 99.0

For Immediate Release Contacts: News Media Lisa Marie Bongiovanni 310-252-3524 LisaMarie.Bongiovanni@mattel.com Securities Analysts Dianne Douglas 310-252-2703 Dianne.Douglas@mattel.com

MATTEL REPORTS SECOND QUARTER 2004 FINANCIAL RESULTS

Second Quarter Financial Highlights

• Worldwide net sales up 5 percent;

• Domestic gross sales up 1 percent and international gross sales up 12 percent;

• Worldwide gross sales for core brands: Barbie^® down 13 percent; Hot Wheels^® up 37 percent; core Fisher-Price^® up 12 percent and American Girl^® brands up 18 percent;

• Gross margin decreased 70 basis points of net sales; SG&A decreased 30 basis points of net sales;

• Operating income as a percentage of net sales was 5.4 percent, flat with prior year; and

• Earnings per share of $0.06 vs. prior year of $0.05.

EL SEGUNDO, Calif., July 19, 2004 — Mattel, Inc. (NYSE:MAT) today reported 2004 second quarter financial results. For the quarter, the company reported net income of $23.5 million, or $0.06 per share, compared to last year’s second quarter net income of $20.9 million, or $0.05 per share.

“The second quarter was consistent with our expectations that 2004 will be a challenging year. To improve long term performance, we are acutely focused on addressing the top line by reinvigorating the Barbie^® brand and capitalizing on the positive momentum of our electronic learning strategy,” said Robert A. Eckert, chairman and chief executive officer of Mattel. “To that end, we will continue to make strategic investments in the business to drive that growth.”

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Second Quarter Financial Overview

For the quarter, net sales were $804.0 million, a 5 percent increase from $769.0 million last year, which included a benefit from changes in currency exchange rates of 2 percentage points. Additionally, beginning in last year’s fourth quarter, the company changed the way it classifies certain close-out sales resulting in a 1.6 percentage point benefit to net sales for the second quarter of 2004 when compared to the year ago quarter. On a regional basis, second quarter gross sales increased 1 percent in the U.S., and in international markets, second quarter gross sales were up 12 percent, which included a benefit from changes in currency exchange rates of 4 percentage points.

For the second quarter, operating income was $43.2 million, an increase of 4 percent compared to the prior year, driven primarily by sales growth. In the second quarter of 2003, operating income included charges of $13.1 million associated with the company’s financial realignment plan, which was completed in the fourth quarter of 2003. From time to time, the company expects to invest in initiatives intended to enhance productivity and improve margins, and while the company will continue to provide information regarding the cost of these initiatives, it will no longer provide the pro forma impact on results.

The company’s balance sheet continued on track with a debt-to-total-capital ratio of 26.3 percent, which is consistent with the company’s long-term goal. During the six months ended June 30, 2004, the company’s cash and short-term investments declined by approximately $789 million, compared to a decline of $684 million in the prior year period, largely due to cash used for share repurchases, which was partially offset by improvements in net cash used for operating activities. During the second quarter, the company acquired 14.2 million shares of its common stock at a cost of $245.9 million.

Second Quarter Sales by Business Unit

Mattel Brands

For the second quarter, worldwide gross sales for the Mattel Brands business unit were $513.3 million, an increase of 4 percent versus a year ago, reflecting a 1 percent decline in domestic sales offset by an 8 percent increase in international sales. Worldwide gross sales

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for the Barbie^® brand were down 13 percent. Worldwide gross sales for the Wheels category, which includes the Hot Wheels^®, Matchbox^® and Tyco^® R/C brands, were up 22 percent. Worldwide gross sales for the Entertainment category, which includes the Games and Puzzles segment, were up 31 percent for the quarter.

Fisher-Price^® Brands

Second quarter worldwide gross sales for the Fisher-Price^® Brands business unit, which includes the Fisher-Price^®, PowerTouch^™, Little People^®, Rescue Heroes^® and Power Wheels^® brands, were $314.6 million, up 6 percent due to strong worldwide sales of core Fisher-Price^® and international sales of Fisher-Price Friends.

American Girl^® Brands

Second quarter gross sales for the American Girl^® Brands business unit, which offers American Girl^® branded products direct to consumers, were $49.1 million, up 18 percent, primarily due to sales generated by the new American Girl Place^® retail store in New York City, which opened in November 2003.

Live Webcast

Mattel will webcast its 2004 second quarter earnings conference call at 5:30 a.m. Pacific time (8:30 a.m. Eastern time) today. The conference call will be simulcast on the “Investors & Media” section of www.mattel.com. To listen to the live call, logon to the Website at least 15 minutes early to register, download and install any necessary audio software. An archive of the call may be accessed beginning two hours after the completion of the live call. To listen to a replay of the call via telephone,

dial + (719) 457-0820. The passcode is 174789. The telephonic playback will be available beginning at 9:30 a.m. Pacific time the morning of the call, until Tuesday, July 20^th at 9 p.m. Pacific time.

Mattel reports its financial results in accordance with generally accepted accounting principles (GAAP). Information required by Securities and Exchange Commission Regulation G, regarding any non-GAAP financial measures provided for analytical purposes, as well as other financial and statistical information, will be available at the time of the webcast on the “Investors & Media” section of www.mattel.com, under the headings “Financial Information”—“Earnings Releases.”

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About Mattel

Mattel, Inc., (NYSE: MAT, www.mattel.com) is the worldwide leader in the design, manufacture and marketing of toys and family products, including Barbie^®, the most popular fashion doll ever created. Leading the toy and game market, the Mattel family is comprised of such best-selling brands as Hot Wheels^®, Matchbox^®, American Girl^®, and Tyco^® R/C, as well as Fisher-Price brands (www.fisher-price.com), including Little People^®, Rescue Heroes^®, Power Wheels^® and a wide array of entertainment-inspired toy lines. With worldwide headquarters in El Segundo, Calif., Mattel employs more than 25,000 people in 36 countries and sells products in more than 150 nations throughout the world. The Mattel vision is to be the world’s premier toy brands—today and tomorrow.

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Note: Forward-looking statements with respect to the financial condition, results of operations and business of the company are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in such statements. These include without limitation: the company’s dependence on the timely development, manufacture, introduction and customer acceptance of new products; the seasonality of the toy business; customer concentration and pricing; significant changes in buying and payment patterns of major customers, including as a result of bankruptcy; adverse changes in general economic conditions in the U.S. and internationally, including adverse changes in the retail environment, employment and the stock market; order predictability and supply chain management; the impact of competition on revenues and margins; the supply and cost of raw materials, components, employee benefits and various services; the success of new initiatives; the effect of currency exchange rate fluctuations on reportable income; risks associated with acquisitions and mergers; the possibility of product recalls and related costs; risks associated with foreign operations; negative results of litigation, governmental proceedings or environmental matters; possible work stoppages, slowdowns or strikes; possible outbreaks of SARS or other diseases; political developments and the threat or occurrence of war or terrorist acts; the possibility of catastrophic events; the inherent risk of new initiatives and other risks and uncertainties as may be detailed from time to time in the company’s public announcements and SEC filings. This release contains forward-looking statements about the Company’s challenges in 2004, growth in the Barbie brand and electronic learning category, the company’s debt-to-equity ratio goal, and strategic initiatives to drive growth. Mattel does not update forward-looking statements and expressly disclaims any obligation to do so.

MATTEL, INC. AND SUBSIDIARIES EXHIBIT I

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(In millions, except per share and percentage information)	For the Three Months Ended June 30,												For the Six Months Ended June 30,
	2004					2003					Yr / Yr % Change		2004					2003					Yr / Yr % Change
	$ Amt			% Net Sales		$ Amt			% Net Sales				$ Amt			% Net Sales		$ Amt			% Net Sales
Net Sales (a)	$	804.0				$	769.0				5	%	$	1,584.9				$	1,514.3				5	%
Cost of sales (a)		437.7		54.4	%		412.7		53.7	%	6	%		866.9		54.7	%		790.0		52.2	%	10	%
Gross Profit		366.3		45.6	%		356.3		46.3	%	3	%		718.0		45.3	%		724.3		47.8	%	-1	%
Advertising and promotion expenses		84.4		10.5	%		80.8		10.5	%	5	%		171.8		10.9	%		164.6		10.9	%	4	%
Other selling and administrative expenses		238.7		29.7	%		230.5		30.0	%	4	%		490.3		30.9	%		453.4		29.9	%	8	%
Restructuring and other charges		—		0.0	%		3.3		0.4	%	-100	%		—		0.0	%		12.0		0.8	%	-100	%
Operating Income		43.2		5.4	%		41.7		5.4	%	4	%		55.9		3.5	%		94.3		6.2	%	-41	%
Interest expense		16.4		2.0	%		18.2		2.4	%	-10	%		31.6		2.0	%		35.6		2.4	%	-11	%
Interest (income)		(4.1	)	-0.5	%		(5.3	)	-0.7	%	-21	%		(9.0	)	-0.6	%		(11.7	)	-0.8	%	-23	%
Other non-operating (income), net		(1.5	)	-0.1	%		—		0.0	%				(11.5	)	-0.7	%		(3.0	)	-0.2	%
Income Before Income Taxes		32.4		4.0	%		28.8		3.7	%	13	%		44.8		2.8	%		73.4		4.8	%	-39	%
Provision for income taxes		8.9					7.9							12.3					19.7
Net Income	$	23.5		2.9	%	$	20.9		2.7	%	13	%	$	32.5		2.1	%	$	53.7		3.5	%	-39	%
EPS—Basic	$	0.06				$	0.05						$	0.08				$	0.12
Average Number of Common Shares Outstanding—Basic		419.2					439.7							423.7					439.0
EPS—Diluted	$	0.06				$	0.05						$	0.08				$	0.12
Average Number of Common and Common Equivalent Shares Outstanding—Diluted		422.9					445.5							427.6					444.7

(a) Close out sales for the three- and six-months ended June 30, 2003, totaling $12.0 million and $25.3 million, respectively, are classified as a reduction of cost of sales.

MATTEL, INC. AND SUBSIDIARIES EXHIBIT II

WORLDWIDE GROSS SALES INFORMATION (Unaudited)

	Three Months Ended June 30,										Six Months Ended June 30,
(In millions, except percentage information)	2004					2003					2004					2003
Worldwide Gross Sales (a):
Mattel Brands	$	513.3				$	494.7				$	1,045.4				$	1,027.0
% Change				4	%				-9	%				2	%				-4	%
Pos./(Neg.) Impact of Currency (in % pts)				2					5					4					5
Fisher-Price Brands		314.6					295.6					578.6					528.9
% Change				6	%				0	%				9	%				1	%
Pos./(Neg.) Impact of Currency (in % pts)				1					3					2					2
American Girl Brands		49.1					41.6					103.2					88.0
% Change				18	%				-3	%				17	%				-6	%
Other		2.3					1.3					5.6					1.8
Gross Sales	$	879.3				$	833.2				$	1,732.8				$	1,645.7
% Change				6	%				-6	%				5	%				-3	%
Pos./(Neg.) Impact of Currency (in % pts)				2					4					3					4
Reconciliation of GAAP to Non-GAAP Financial Measure:
Gross Sales	$	879.3				$	833.2				$	1,732.8				$	1,645.7
Sales Adjustments		(75.3	)				(64.2	)				(147.9	)				(131.4	)
Net Sales (a)	$	804.0				$	769.0				$	1,584.9				$	1,514.3
% Change				5	%				-4	%				5	%				-2	%
Pos./(Neg.) Impact of Currency (in % pts)				2					4					3					4

(a) Close out sales for the three- and six-months ended June 30, 2003, totaling $12.0 million and $25.3 million, respectively, are classified as a reduction of cost of sales. Please refer to Mattel’s Current Report on Form 8-K dated February 3, 2004, for discussion of annual and quarterly close out sales amounts impacting worldwide gross sales.

MATTEL, INC. AND SUBSIDIARIES EXHIBIT III

CONDENSED CONSOLIDATED BALANCE SHEETS

	At June 30,				At Dec. 31, 2003
(In millions)	2004		2003
	(Unaudited)		(Unaudited)
Assets
Cash and short-term investments	$	363.5	$	582.8	$	1,152.7
Accounts receivable, net		622.7		603.7		543.9
Inventories		557.5		540.4		388.7
Prepaid expenses and other current assets		266.9		258.7		309.6
Total current assets		1,810.6		1,985.6		2,394.9
Property, plant and equipment, net		603.2		604.3		625.9
Other assets		1,494.2		1,492.0		1,490.2
Total Assets	$	3,908.0	$	4,081.9	$	4,511.0
Liabilities and Stockholders’ Equity
Short-term borrowings	$	76.3	$	23.9	$	19.6
Current portion of long-term debt		41.0		162.2		52.3
Accounts payable and accrued liabilities		761.1		806.8		1,142.7
Income taxes payable		219.4		163.9		253.2
Total current liabilities		1,097.8		1,156.8		1,467.8
Long-term debt		588.6		629.6		589.1
Other long-term liabilities		242.0		202.6		237.9
Stockholders’ equity		1,979.6		2,092.9		2,216.2
Total Liabilities and Stockholders’ Equity	$	3,908.0	$	4,081.9	$	4,511.0

SUPPLEMENTAL BALANCE SHEET AND CASH FLOW DATA (Unaudited)

	At June 30,
(In millions, except days and percentage information)	2004			2003
Key Balance Sheet Data:
Accounts Receivable, Net
Days of Sales Outstanding (DSO)		70			71
Inventories
Days of Supply (DOS)		57			54
Total Debt Outstanding	$	705.9		$	815.7
Total Debt-to-Total Capitalization		26.3	%		28.0	%
	Six Months Ended June 30,
(In millions)	2004			2003
Preliminary Condensed Cash Flow Data (a):
Cash Flows (Used For) Operating Activities	$	(518	)	$	(600	)
Cash Flows (Used For) Investing Activities		(63	)		(91	)
Cash Flows (Used For) From Financing Activities and Other		(208	)		7
Decrease in Cash and Short-term Investments	$	(789	)	$	(684	)

(a) Amounts shown are preliminary estimates. Actual amounts will be reported in Mattel’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2004.