10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2014

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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. El Segundo, CA	90245-5012
(Address of principal executive offices)	(Zip Code)

(310) 252-2000

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report):

NONE

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  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

Number of shares outstanding of registrant’s common stock, $1.00 par value, as of July 21, 2014:

337,847,854 shares

MATTEL, INC. AND SUBSIDIARIES

		Page
	PART I
Item 1.	Financial Statements		3
	Consolidated Balance Sheets		3
	Consolidated Statements of Operations		4
	Consolidated Statements of Comprehensive Income		5
	Consolidated Statements of Cash Flows		6
	Notes to Consolidated Financial Statements		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		38
Item 4.	Controls and Procedures		39
	PART II
Item 1.	Legal Proceedings		40
Item 1A.	Risk Factors		40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		40
Item 3.	Defaults Upon Senior Securities		40
Item 4.	Mine Safety Disclosures		40
Item 5.	Other Information		40
Item 6.	Exhibits		41
	Signature		42

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	June 30, 2014			June 30, 2013			December 31, 2013
	(Unaudited; in thousands, except share data)
ASSETS
Current Assets
Cash and equivalents	$	518,217		$	823,019		$	1,039,216
Accounts receivable, net		878,858			945,727			1,260,105
Inventories		885,359			793,611			568,843
Prepaid expenses and other current assets		602,874			564,804			509,829
Total current assets		2,885,308			3,127,161			3,377,993
Noncurrent Assets
Property, plant, and equipment, net		704,433			621,168			659,333
Goodwill		1,398,766			1,072,084			1,083,239
Other noncurrent assets		1,489,989			1,375,979			1,319,061
Total Assets	$	6,478,496		$	6,196,392		$	6,439,626
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Short-term borrowings	$	20,481		$	40,701		$	4,278
Current portion of long-term debt		—			50,000			—
Accounts payable		385,655			337,511			375,328
Accrued liabilities		481,843			584,201			640,155
Income taxes payable		20,651			25,978			27,679
Total current liabilities		908,630			1,038,391			1,047,440
Noncurrent Liabilities
Long-term debt		2,100,000			1,600,000			1,600,000
Other noncurrent liabilities		518,299			636,553			540,627
Total noncurrent liabilities		2,618,299			2,236,553			2,140,627
Stockholders’ Equity
Common stock $1.00 par value, 1.0 billion shares authorized; 441.4 million shares issued		441,369			441,369			441,369
Additional paid-in capital		1,771,095			1,778,242			1,784,445
Treasury stock at cost: 103.7 million shares, 96.2 million shares, and 102.1 million shares, respectively		(2,534,981	)		(2,156,651	)		(2,448,701	)
Retained earnings		3,674,348			3,374,408			3,918,122
Accumulated other comprehensive loss		(400,264	)		(515,920	)		(443,676	)
Total stockholders’ equity		2,951,567			2,921,448			3,251,559
Total Liabilities and Stockholders’ Equity	$	6,478,496		$	6,196,392		$	6,439,626

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

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MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(Unaudited; in thousands, except per share amounts)
Net Sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715
Cost of sales		569,682			569,101			1,034,328			1,024,656
Gross Profit		492,570			600,008			974,101			1,140,059
Advertising and promotion expenses		99,853			113,403			190,687			217,943
Other selling and administrative expenses		391,709			391,815			776,188			761,495
Operating Income		1,008			94,790			7,226			160,621
Interest expense		18,965			18,259			36,211			38,596
Interest (income)		(2,186	)		(1,289	)		(3,465	)		(2,689	)
Other non-operating (income) expense, net		(1,400	)		(909	)		(1,728	)		1,820
(Loss) Income Before Income Taxes		(14,371	)		78,729			(23,792	)		122,894
(Benefit) provision for income taxes		(42,696	)		5,381			(40,899	)		11,035
Net Income	$	28,325		$	73,348		$	17,107		$	111,859
Net Income Per Common Share—Basic	$	0.08		$	0.21		$	0.05		$	0.32
Weighted average number of common shares		338,709			346,614			339,463			345,453
Net Income Per Common Share—Diluted	$	0.08		$	0.21		$	0.05		$	0.32
Weighted average number of common and potential common shares		340,644			350,424			341,594			349,503
Dividends Declared Per Common Share	$	0.38		$	0.36		$	0.76		$	0.72

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

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MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(Unaudited; in thousands)
Net Income	$	28,325		$	73,348		$	17,107		$	111,859
Other Comprehensive Income (Loss), Net of Tax:
Currency translation adjustments		33,506			(37,383	)		37,378			(64,762	)
Defined benefit pension plans net prior service credit and net actuarial loss		2,657			3,434			4,745			6,865
Net unrealized (losses) gains on derivative instruments:
Unrealized holding (losses) gains		(5,536	)		(872	)		(4,308	)		7,266
Reclassification adjustment for realized losses (gains) included in net income		2,830			326			5,597			(803	)
		(2,706	)		(546	)		1,289			6,463
Other Comprehensive Income (Loss), Net of Tax		33,457			(34,495	)		43,412			(51,434	)
Comprehensive Income	$	61,782		$	38,853		$	60,519		$	60,425

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

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MATTEL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Six Months Ended
	June 30, 2014			June 30, 2013
	(Unaudited; in thousands)
Cash Flows From Operating Activities:
Net income	$	17,107		$	111,859
Adjustments to reconcile net income to net cash flows used for operating activities:
Depreciation		97,582			86,647
Amortization		12,242			8,331
Asset impairment		—			14,000
Deferred income taxes		(28,971	)		(26,182	)
Tax benefits from share-based payment arrangements		(16,628	)		(40,113	)
Share-based compensation		24,472			27,581
Increase (decrease) from changes in assets and liabilities:
Accounts receivable		414,563			261,907
Inventories		(231,120	)		(348,613	)
Prepaid expenses and other current assets		(79,710	)		(41,182	)
Accounts payable, accrued liabilities, and income taxes payable		(266,647	)		(344,817	)
Other, net		(22,047	)		4,671
Net cash flows used for operating activities		(79,157	)		(285,911	)
Cash Flows From Investing Activities:
Purchases of tools, dies, and molds		(70,538	)		(59,341	)
Purchases of other property, plant, and equipment		(37,877	)		(55,538	)
Payments for acquisition, net of cash acquired		(423,309	)		—
Proceeds (payments) from foreign currency forward exchange contracts		6,615			(15,135	)
Other, net		367			(2,462	)
Net cash flows used for investing activities		(524,742	)		(132,476	)
Cash Flows From Financing Activities:
Payments of short-term borrowings, net		(4,278	)		(9,844	)
Proceeds from short-term borrowings, net		20,481			40,701
Payments of credit facility renewal costs		—			(4,003	)
Payments of long-term borrowings		(44,587	)		(350,000	)
Proceeds from long-term borrowings, net		495,458			495,260
Share repurchases		(128,165	)		(150,787	)
Payments of dividends on common stock		(257,669	)		(249,083	)
Proceeds from exercise of stock options		14,566			106,826
Tax benefits from share-based payment arrangements		16,628			40,113
Other, net		(29,350	)		(3,436	)
Net cash flows provided by (used for) financing activities		83,084			(84,253	)
Effect of Currency Exchange Rate Changes on Cash		(184	)		(10,052	)
Decrease in Cash and Equivalents		(520,999	)		(512,692	)
Cash and Equivalents at Beginning of Period		1,039,216			1,335,711
Cash and Equivalents at End of Period	$	518,217		$	823,019

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

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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 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 presentation of the financial position and interim results of Mattel, Inc. and its subsidiaries (“Mattel”) as of and for the periods presented have been included. 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 year-end balance sheet data was derived from audited financial statements; however, the accompanying interim notes to the consolidated financial statements do not include all disclosures required by accounting principles generally accepted in the United States of America.

The financial information included herein should be read in conjunction with Mattel’s consolidated financial statements and related notes in its 2013 Annual Report on Form 10-K.

2. Accounts Receivable

Accounts receivable are net of allowances for doubtful accounts of $21.4 million, $35.9 million, and $20.4 million as of June 30, 2014, June 30, 2013, and December 31, 2013, respectively.

3. Inventories

Inventories include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Raw materials and work in process	$	140,407	$	142,950	$	89,863
Finished goods		744,952		650,661		478,980
	$	885,359	$	793,611	$	568,843

4. Property, Plant, and Equipment

Property, plant, and equipment, net includes the following:

	June 30, 2014			June 30, 2013			December 31, 2013
	(In thousands)
Land	$	27,666		$	26,605		$	27,555
Buildings		272,169			268,985			269,874
Machinery and equipment		709,002			680,861			673,546
Software		317,388			275,626			301,284
Tools, dies, and molds		763,490			709,723			713,749
Capital leases		23,921			23,271			23,271
Leasehold improvements		233,937			221,322			230,271
		2,347,573			2,206,393			2,239,550
Less: accumulated depreciation		(1,643,140	)		(1,585,225	)		(1,580,217	)
	$	704,433		$	621,168		$	659,333

Property, plant, and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over estimated useful lives of 10 to 30 years for buildings, 3 to 10 years for machinery and equipment, 3 to 7 years for software, and 10 to 20 years, not to exceed the lease term, for leasehold improvements. Tools, dies, and molds are depreciated using the straight-line method over 3 years. Estimated useful lives are periodically reviewed and, where appropriate, changes are made prospectively. The carrying value of property, plant, and equipment is reviewed when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Any potential impairment identified is assessed by

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evaluating the operating performance and future undiscounted cash flows of the underlying assets. When property is sold or retired, the cost of the property and the related accumulated depreciation are removed from the consolidated balance sheet, and any resulting gain or loss is included in the results of operations.

5. Goodwill

Goodwill is allocated to various reporting units, which are at the operating segment level, for purposes of evaluating whether goodwill is impaired. Mattel’s reporting units are: (i) North America, (ii) International, and (iii) American Girl. Mattel tests its goodwill for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying value of a reporting unit may exceed its fair value.

The change in the carrying amount of goodwill by operating segment for the six months ended June 30, 2014 is shown below. Brand-specific goodwill held by foreign subsidiaries is allocated to the North America and American Girl operating segments selling those brands, thereby causing a foreign currency translation impact for these operating segments.

	December 31, 2013		Acquisition		Currency Exchange Rate Impact			June 30, 2014
	(In thousands)
North America	$	547,595	$	171,062	$	1,267		$	719,924
International		321,656		139,960		3,262			464,878
American Girl		213,988		—		(24	)		213,964
Total goodwill	$	1,083,239	$	311,022	$	4,505		$	1,398,766

Acquisition of MEGA Brands Inc.

On April 30, 2014, Mattel acquired MEGA Brands Inc., a corporation incorporated under the laws of Canada (“MEGA Brands”), pursuant to the Arrangement Agreement dated as of February 27, 2014, between MEGA Brands, Mattel Overseas Operations Ltd., a corporation incorporated under the laws of Bermuda, Mattel-MEGA Holdings Inc., a corporation incorporated under the laws of Canada (the “Purchasing Subsidiary”), and, with respect to certain provisions thereof, Mattel (the “Arrangement Agreement”). Pursuant to the terms set forth in the Arrangement Agreement, Mattel indirectly acquired, through the Purchasing Subsidiary, 100% of the issued and outstanding common shares and warrants of MEGA Brands for total cash consideration of $454.9 million, including payment for cash acquired of $31.6 million. The acquisition of MEGA Brands will build upon Mattel’s portfolio of brands by expanding into the construction building sets and arts and crafts categories.

The total purchase consideration was allocated to the assets acquired and liabilities assumed based on their estimated fair values. As a result of the acquisition, Mattel recognized $95.0 million of identifiable intangible assets (primarily related to trade names and existing product lines), $48.9 million of net assets acquired (which included $31.6 million of cash, $85.6 million of inventory, $33.6 million of property, plant, and equipment, $67.5 million of accounts payable and accrued liabilities, $44.6 million of long-term debt, and $10.2 million of other net assets), and $311.0 million of goodwill, which is not deductible for tax purposes. The fair values of the identifiable intangible assets related to trade names were based on the relief from royalty method, using Level 3 inputs within the fair value hierarchy, which included forecasted future cash flows, long-term revenue growth rates, royalty rates, and discount rates. The fair values of the identifiable intangible assets related to existing product lines were estimated based on the multi-period excess earnings method, using Level 3 inputs within the fair value hierarchy, which included forecasted future cash flows, long-term revenue growth rates, and discount rates. Goodwill relates to a number of factors built into the purchase price, including the future earnings and cash flow potential of the business, as well as the complementary strategic fit and the resulting synergies it brings to Mattel’s existing operations. Mattel is in the process of finalizing the valuation of the assets acquired and liabilities assumed. The determination of the final values of assets acquired and liabilities assumed may result in adjustments to the values presented and a corresponding adjustment to goodwill.

Additionally, during the three and six months ended June 30, 2014, Mattel recognized approximately $4 million of integration costs and approximately $7 million of transaction costs. Integration and transaction costs are recorded within other selling and administrative expenses in the consolidated statements of operations. The pro forma and actual results of operations for this acquisition have not been presented because they are not material.

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6. Other Noncurrent Assets

Other noncurrent assets include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Nonamortizable identifiable intangibles	$	517,378	$	504,241	$	504,241
Deferred income taxes		424,184		439,937		373,638
Identifiable intangibles (net of amortization of $77.2 million, $68.8 million, and $68.3 million, respectively)		261,636		182,005		176,579
Other		286,791		249,796		264,603
	$	1,489,989	$	1,375,979	$	1,319,061

In connection with the acquisition of MEGA Brands, as more fully described in “Note 5 to the Consolidated Financial Statements—Goodwill” of this Quarterly Report on Form 10-Q, Mattel recognized $95.0 million of amortizable identifiable intangible assets, primarily related to trade names and existing product lines.

Mattel tests nonamortizable intangible assets, including trademarks and trade names, for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying values may exceed the fair values. Mattel also tests its amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable.

During the second quarter of 2013, Mattel changed its brand strategy for Polly Pocket^®, which includes a more focused allocation of resources to support the Polly Pocket brand in specific markets, resulting in a reduction of the forecasted future cash flows of the brand. As a result of the change, Mattel tested the Polly Pocket trade name for impairment. The Polly Pocket trade name, which had a carrying value of approximately $113 million, was previously determined to be a nonamortizable intangible asset. Its fair value was determined to be approximately $99 million based on a discounted cash flow analysis using the multi-period excess earnings method. Level 3 inputs, including forecasted future cash flows, an estimated useful life, and a discount rate, were used in the valuation. As the fair value of the asset was below the carrying value, Mattel recorded an impairment charge of approximately $14 million, which was reflected within other selling and administrative expenses in the consolidated statement of operations for the North America and International operating segments during the second quarter of 2013.

In conjunction with the Polly Pocket trade name impairment test, Mattel reassessed the intangible asset’s nonamortizable classification and determined that the nonamortizable classification could no longer be supported. During the second quarter of 2013, the Polly Pocket trade name was reclassified as an amortizable intangible asset, and the remaining fair value of the asset is being amortized over its estimated remaining useful life.

7. Accrued Liabilities

Accrued liabilities include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Royalties	$	63,366	$	55,904	$	100,542
Advertising and promotion		52,506		9,378		76,453
Taxes other than income taxes		33,530		48,492		70,121
Litigation accrual		—		137,800		—
Other		332,441		332,627		393,039
	$	481,843	$	584,201	$	640,155

8. Seasonal Financing

Mattel maintains and periodically amends or replaces its domestic unsecured committed revolving credit facility with a commercial bank group. The facility is used as a back-up to Mattel’s commercial paper program, which is used as the primary source of financing for the seasonal working capital requirements of its domestic subsidiaries. The agreement governing the credit facility was amended and restated on March 11, 2013 to, among other things, (i) extend the maturity date of the credit facility to March 12, 2018, (ii) increase aggregate commitments under the credit facility to $1.60 billion, with an “accordion feature,” which allows Mattel to increase the aggregate availability under the credit facility to $1.85 billion under certain circumstances, (iii) decrease the applicable interest rate margins to a range of 0.00% to 0.75% above the applicable base rate for base rate loans and 0.88% to 1.75% above the applicable LIBOR for Eurodollar rate loans, in each case depending on Mattel’s senior unsecured long-term debt rating, and (iv) decrease commitment fees to a range of 0.08% to 0.28% of the unused commitments under the credit facility.

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The amended credit facility has a borrowing capacity of up to $1.60 billion over a term of five years. Prior to the amendment, the facility permitted Mattel to borrow up to $1.40 billion and had two years remaining to maturity. The proportion of unamortized debt issuance costs from the prior facility renewal related to creditors involved in both the prior facility and amended facility and borrowing costs incurred as a result of the amendment were deferred, and such costs will be amortized over the term of the amended facility.

Mattel is required to meet financial ratio covenants at the end of each quarter and fiscal year, using the formulae specified in the credit agreement to calculate the ratios. Mattel was in compliance with such covenants at June 30, 2014.

The credit agreement is a material agreement and failure to comply with the financial ratio covenants may result in an event of default under the terms of the credit facility. If Mattel were to default under the terms of the credit facility, its ability to meet its seasonal financing requirements could be adversely affected.

9. Long-Term Debt

Long-term debt includes the following:

	June 30, 2014		June 30, 2013			December 31, 2013
	(In thousands)
Medium-term notes	$	—	$	50,000		$	—
2010 Senior Notes due October 2020 and October 2040		500,000		500,000			500,000
2011 Senior Notes due November 2016 and November 2041		600,000		600,000			600,000
2013 Senior Notes due March 2018 and March 2023		500,000		500,000			500,000
2014 Senior Notes due May 2019		500,000		—			—
		2,100,000		1,650,000			1,600,000
Less: current portion		—		(50,000	)		—
Total long-term debt	$	2,100,000	$	1,600,000		$	1,600,000

In May 2014, Mattel issued $500.0 million aggregate principal amount of 2.35% senior unsecured notes due May 6, 2019 (“2014 Senior Notes”). Interest on the 2014 Senior Notes is payable semi-annually on May 6 and November 6 of each year, beginning November 6, 2014. Mattel may redeem all or part of the 2014 Senior Notes at any time or from time to time at its option, at a redemption price equal to the greater of (i) 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest to but excluding the redemption date, and (ii) a “make-whole” amount based on the yield of a comparable US Treasury security plus 12.5 basis points.

During the second quarter of 2014, Mattel repaid $44.6 million of long-term borrowings assumed through the acquisition of MEGA Brands.

During the fourth quarter of 2013, Mattel repaid $50.0 million of its Medium-term notes in connection with their scheduled maturities.

10. Other Noncurrent Liabilities

Other noncurrent liabilities include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Benefit plan liabilities	$	191,817	$	279,005	$	193,046
Noncurrent tax liabilities		157,639		202,441		186,055
Other		168,843		155,107		161,526
	$	518,299	$	636,553	$	540,627

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11. Accumulated Other Comprehensive Income (Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income (loss):

	For the Three Months Ended June 30, 2014
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2014	$	(6,794	)	$	(129,858	)	$	(297,069	)	$	(433,721	)
Other comprehensive (loss) income before reclassifications		(5,536	)		464			33,506			28,434
Amounts reclassified from accumulated other comprehensive income (loss)		2,830			2,193			—			5,023
Net (decrease) increase in other comprehensive income		(2,706	)		2,657			33,506			33,457
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2014	$	(9,500	)	$	(127,201	)	$	(263,563	)	$	(400,264	)
	For the Six Months Ended June 30, 2014
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2013	$	(10,789	)	$	(131,946	)	$	(300,941	)	$	(443,676	)
Other comprehensive (loss) income before reclassifications		(4,308	)		372			37,378			33,442
Amounts reclassified from accumulated other comprehensive income (loss)		5,597			4,373			—			9,970
Net increase in other comprehensive income		1,289			4,745			37,378			43,412
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2014	$	(9,500	)	$	(127,201	)	$	(263,563	)	$	(400,264	)
	For the Three Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2013	$	4,426		$	(187,225	)	$	(298,626	)	$	(481,425	)
Other comprehensive (loss) income before reclassifications		(872	)		314			(37,383	)		(37,941	)
Amounts reclassified from accumulated other comprehensive income (loss)		326			3,120			—			3,446
Net (decrease) increase in other comprehensive income		(546	)		3,434			(37,383	)		(34,495	)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)
	For the Six Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2012	$	(2,583	)	$	(190,656	)	$	(271,247	)	$	(464,486	)
Other comprehensive income (loss) before reclassifications		7,266			625			(64,762	)		(56,871	)
Amounts reclassified from accumulated other comprehensive income (loss)		(803	)		6,240			—			5,437
Net increase (decrease) in other comprehensive income		6,463			6,865			(64,762	)		(51,434	)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)

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The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statement of operations:

	For the Three Months Ended June 30, 2014			For the Three Months Ended June 30, 2013			Statements of Operations Classification
	(In thousands)
Derivative Instruments
Loss on foreign currency forward exchange contracts	$	(2,859	)	$	(318	)	Cost of sales
		29			(8	)	Provision for income taxes
	$	(2,830	)	$	(326	)	Net income
Defined Benefit Pension Plans
Amortization of prior service credit	$	264		$	126		(a)
Recognized actuarial loss		(3,664	)		(5,146	)	(a)
		(3,400	)		(5,020	)
		1,207			1,900		Provision for income taxes
	$	(2,193	)	$	(3,120	)	Net income
	For the Six Months Ended June 30, 2014			For the Six Months Ended June 30, 2013			Statements of Operations Classification
	(In thousands)
Derivative Instruments
(Loss) gain on foreign currency forward exchange contracts	$	(5,577	)	$	813		Cost of sales
		(20	)		(10	)	Provision for income taxes
	$	(5,597	)	$	803		Net income
Defined Benefit Pension Plans
Amortization of prior service credit	$	528		$	252		(a)
Recognized actuarial loss		(7,326	)		(10,292	)	(a)
		(6,798	)		(10,040	)
		2,425			3,800		Provision for income taxes
	$	(4,373	)	$	(6,240	)	Net income

(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” of this Quarterly Report on Form 10-Q for additional information regarding Mattel’s net periodic benefit cost.

Currency Translation Adjustments

Mattel’s reporting currency is the US dollar. The translation of its net investments in subsidiaries with non-US dollar functional currencies subjects Mattel to the impact of currency exchange rate fluctuations in its results of operations and financial position. Assets and liabilities of subsidiaries with non-US dollar functional currencies are translated into US dollars at fiscal period-end

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exchange rates. Income, expense, and cash flow items are translated at weighted average exchange rates prevailing during the fiscal period. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive income (loss) within stockholders’ equity. Currency translation adjustments resulted in a net gain of $37.4 million for the six months ended June 30, 2014, primarily due to the strengthening of the British pound sterling, Brazilian real, and Australian dollar against the US dollar, partially offset by the weakening of the Euro. Currency translation adjustments resulted in a net loss of $64.8 million for the six months ended June 30, 2013, primarily due to the weakening of the Euro, Brazilian real, British pound sterling, and Australian dollar against the US dollar.

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 generally have maturity dates of up to 18 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. Additionally, 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. As of June 30, 2014, June 30, 2013, and December 31, 2013, Mattel held foreign currency forward exchange contracts with notional amounts of approximately $1.43 billion, $1.43 billion, and $1.55 billion, respectively.

The following table presents Mattel’s derivative assets and liabilities:

	Asset Derivatives
	Balance Sheet Classification	Fair Value
		June 30, 2014		June 30, 2013		December 31, 2013
				(In thousands)
Derivatives designated as hedging instruments:
Foreign currency forward exchange contracts	Prepaid expenses and other current assets	$	2,938	$	7,389	$	415
Foreign currency forward exchange contracts	Other noncurrent assets		541		—		—
Total derivatives designated as hedging instruments		$	3,479	$	7,389	$	415
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Prepaid expenses and other current assets	$	4,323	$	—	$	1,895
Total		$	7,802	$	7,389	$	2,310
	Liability Derivatives
	Balance Sheet Classification	Fair Value
		June 30, 2014		June 30, 2013		December 31, 2013
				(In thousands)
Derivatives designated as hedging instruments:
Foreign currency forward exchange contracts	Accrued liabilities	$	10,028	$	2,436	$	12,432
Foreign currency forward exchange contracts	Other noncurrent liabilities		75		—		470
Total derivatives designated as hedging instruments		$	10,103	$	2,436	$	12,902
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Accrued liabilities	$	299	$	2,642	$	1,711
Total		$	10,402	$	5,078	$	14,613

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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:

	For the Three Months Ended June 30, 2014						For the Three Months Ended June 30, 2013						Statements of Operations Classification
	Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations			Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations
	(In thousands)
Derivatives designated as hedging instruments
Foreign currency forward exchange contracts	$	(5,536	)	$	(2,830	)	$	(872	)	$	(326	)	Cost of sales
	For the Six Months Ended June 30, 2014						For the Six Months Ended June 30, 2013						Statements of Operations Classification
	Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations			Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations
	(In thousands)
Derivatives designated as hedging instruments
Foreign currency forward exchange contracts	$	(4,308	)	$	(5,597	)	$	7,266		$	803		Cost of sales

The net losses of $2.8 million and $5.6 million reclassified from accumulated other comprehensive loss to the consolidated statements of operations for the three and six months ended June 30, 2014, respectively, and the net loss of $0.3 million and net gain of $0.8 million reclassified from accumulated other comprehensive loss to the consolidated statements of operations for the three and six months ended June 30, 2013, respectively, are offset by the changes in cash flows associated with the underlying hedged transactions.

	Amount of Gain (Loss) Recognized in the Statements of Operations						Statements of Operations Classification
	For the Three Months Ended June 30, 2014			For the Three Months Ended June 30, 2013
	(In thousands)
Derivatives not designated as hedging instruments
Foreign currency forward exchange contracts	$	2,216		$	(3,546	)	Non-operating income/expense
Foreign currency forward exchange contracts		(1,085	)		(372	)	Cost of sales
Total	$	1,131		$	(3,918	)
	Amount of Gain (Loss) Recognized in the Statements of Operations						Statements of Operations Classification
	For the Six Months Ended June 30, 2014			For the Six Months Ended June 30, 2013
	(In thousands)
Derivatives not designated as hedging instruments
Foreign currency forward exchange contracts	$	9,769		$	(17,321	)	Non-operating income/expense
Foreign currency forward exchange contracts		686			31		Cost of sales
Total	$	10,455		$	(17,290	)

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The net gains of $1.1 million and $10.5 million recognized in the consolidated statements of operations for the three and six months ended June 30, 2014, respectively, and the net losses of $3.9 million and $17.3 million recognized in the consolidated statements of operations for the three and six months ended June 30, 2013, respectively, are offset by foreign currency transaction gains and losses on the related hedged balances.

13. Fair Value Measurements

The following table presents information about Mattel’s assets and liabilities measured and reported in the financial statements at fair value and indicates 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.

Mattel’s financial assets and liabilities measured and reported at fair value on a recurring basis include the following:

	June 30, 2014
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	7,802	$	—	$	7,802
Auction rate security (b)		—		—		31,312		31,312
Total assets	$	—	$	7,802	$	31,312	$	39,114
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	10,402	$	—	$	10,402
	June 30, 2013
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	7,389	$	—	$	7,389
Auction rate security (b)		—		—		23,222		23,222
Total assets	$	—	$	7,389	$	23,222	$	30,611
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	5,078	$	—	$	5,078
	December 31, 2013
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	2,310	$	—	$	2,310
Auction rate security (b)		—		—		28,895		28,895
Total assets	$	—	$	2,310	$	28,895	$	31,205
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	14,613	$	—	$	14,613

(a) The fair value of the foreign currency forward exchange contracts is 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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(b) The fair value of the auction rate security is estimated using a discounted cash flow model based on (i) estimated interest rates, timing, and amount of cash flows, (ii) credit spreads, recovery rates, and credit quality of the underlying securities, (iii) illiquidity considerations, and (iv) market correlation.

The following table presents information about Mattel’s auction rate security measured and reported at fair value on a recurring basis using significant Level 3 inputs:

	Level 3
	(In thousands)
Balance at December 31, 2013	$	28,895
Unrealized gain		2,417
Balance at June 30, 2014	$	31,312

Other Financial Instruments

Mattel’s financial instruments include cash and equivalents, accounts receivable and payable, short-term borrowings, and accrued liabilities. The fair values of these instruments approximate their carrying values because of their short-term nature and are classified as Level 2 within the fair value hierarchy.

The estimated fair value of Mattel’s long-term debt, including the current portion, was $2.19 billion (compared to a carrying value of $2.10 billion) as of June 30, 2014, $1.69 billion (compared to a carrying value of $1.65 billion) as of June 30, 2013, and $1.62 billion (compared to a carrying value of $1.60 billion) as of December 31, 2013. The estimated fair values have been calculated based on broker quotes or rates for the same or similar instruments and are classified as Level 2 within the fair value hierarchy.

14. Earnings Per Share

Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method. Certain of Mattel’s restricted stock units (“RSUs”) are considered participating securities because they contain nonforfeitable rights to dividend equivalents.

Under the two-class method, net income is reduced by the amount of dividends declared in the period for each class of common stock and participating securities. The remaining undistributed earnings are then allocated to common stock and participating securities as if all of the net income for the period had been distributed. Basic earnings per common share excludes dilution and is calculated by dividing net income allocable to common shares by the weighted average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net income allocable to common shares by the weighted average number of common shares for the period, as adjusted for the potential dilutive effect of non-participating share-based awards. The following table reconciles earnings per common share for the three and six months ended June 30, 2014 and 2013:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands, except per share amounts)
Basic:
Net income	$	28,325		$	73,348		$	17,107		$	111,859
Less: net income allocable to participating RSUs (a)		(265	)		(725	)		(199	)		(1,131	)
Net income available for basic common shares	$	28,060		$	72,623		$	16,908		$	110,728
Weighted average common shares outstanding		338,709			346,614			339,463			345,453
Basic net income per common share	$	0.08		$	0.21		$	0.05		$	0.32
Diluted:
Net income	$	28,325		$	73,348		$	17,107		$	111,859
Less: net income allocable to participating RSUs (a)		(270	)		(730	)		(212	)		(1,147	)
Net income available for diluted common shares	$	28,055		$	72,618		$	16,895		$	110,712
Weighted average common shares outstanding		338,709			346,614			339,463			345,453
Weighted average common equivalent shares arising from:
Dilutive stock options and non-participating RSUs		1,935			3,810			2,131			4,050
Weighted average number of common and potential common shares		340,644			350,424			341,594			349,503
Diluted net income per common share	$	0.08		$	0.21		$	0.05		$	0.32

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(a) During the three and six months ended June 30, 2014 and 2013, Mattel allocated a proportionate share of both dividends and undistributed earnings to participating RSUs.

The calculation of potential common shares assumes the exercise of dilutive stock options and vesting of non-participating RSUs, net of assumed treasury share repurchases at average market prices. Nonqualified stock options and non-participating RSUs totaling 1.5 million and 0.1 million shares were excluded from the calculation of diluted net income per common share for the three months ended June 30, 2014 and 2013, respectively, because they were antidilutive. Nonqualified stock options and non-participating RSUs totaling 1.4 million and 0.1 million shares were excluded from the calculation of diluted net income per common share for the six months ended June 30, 2014 and 2013, respectively, because they were 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 “Note 4 to the Consolidated Financial Statements–Employee Benefit Plans” in its 2013 Annual Report on Form 10-K.

A summary of the components of net periodic benefit cost for Mattel’s defined benefit pension plans is as follows:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Service cost	$	2,715		$	3,789		$	5,312		$	7,688
Interest cost		6,978			6,635			13,919			13,265
Expected return on plan assets		(8,020	)		(7,329	)		(16,023	)		(14,658	)
Amortization of prior service credit		(264	)		(126	)		(528	)		(252	)
Recognized actuarial loss		3,589			5,106			7,176			10,212
	$	4,998		$	8,075		$	9,856		$	16,255
A summary of the components of net periodic benefit cost for Mattel’s postretirement benefit plans is as follows:
	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Service cost	$	20		$	22		$	40		$	44
Interest cost		452			338			904			676
Recognized actuarial loss		75			40			150			80
	$	547		$	400		$	1,094		$	800

During the six months ended June 30, 2014, Mattel made cash contributions totaling approximately $7 million and $1 million to its defined benefit pension and postretirement benefit plans, respectively.

16. Share-Based Payments

Mattel has various stock compensation plans, which are more fully described in “Note 7 to the Consolidated Financial Statements–Share-Based Payments” in its 2013 Annual Report on Form 10-K. Under the Mattel, Inc. 2010 Equity and Long-Term Compensation Plan, Mattel has the ability to grant nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, RSUs, performance awards, dividend equivalent rights, and shares of common stock to officers, employees, and other persons providing services to Mattel. Stock options are granted with exercise prices at the fair market value of Mattel’s common stock on the applicable grant date and expire no later than ten years from the date of grant. Both stock options and time-vesting RSUs generally provide for vesting over a period of three years from the date of grant.

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Compensation expense, included within other selling and administrative expenses in the consolidated statement of operations, related to stock options and RSUs is as follows:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In thousands)
Stock option compensation expense	$	1,674	$	1,609	$	4,234	$	4,218
RSU compensation expense		10,105		12,110		20,238		23,363
	$	11,779	$	13,719	$	24,472	$	27,581

As of June 30, 2014, total unrecognized compensation cost related to unvested share-based payments totaled $67.5 million and is expected to be recognized over a weighted-average period of 1.7 years.

Mattel uses treasury shares purchased under its share repurchase program to satisfy stock option exercises and the vesting of RSUs. Cash received for stock option exercises for the six months ended June 30, 2014 and 2013 was $14.6 million and $106.8 million, respectively.

17. Other Selling and Administrative Expenses

Other selling and administrative expenses include the following:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In thousands)
Design and development	$	51,562	$	47,411	$	101,059	$	95,384
Identifiable intangible asset amortization		7,622		2,928		10,253		5,731

18. Foreign Currency Transaction Gains and Losses

Currency exchange rate fluctuations may impact Mattel’s results of operations and cash flows. Mattel’s currency transaction exposures include gains and losses realized on unhedged inventory purchases and unhedged receivables and payables balances that are denominated in a currency other than the applicable functional currency. Gains and losses on unhedged inventory purchases and other transactions associated with operating activities are recorded in the components of operating income to which they relate in the consolidated statements of operations. For hedges of intercompany loans and advances, which do not qualify for hedge accounting treatment, the gains or losses on the hedges resulting from changes in fair value as well as the offsetting transaction gains or losses on the related hedged items, along with unhedged items, are recognized in other non-operating income (expense), net in the consolidated statements of operations. Inventory purchase and sale transactions denominated in the Euro, British pound sterling, Mexican peso, Brazilian real, and Indonesian rupiah are the primary transactions that cause foreign currency transaction exposure for Mattel.

Currency transaction gains (losses) included in the consolidated statements of operations are as follows:

	For the Three Months Ended					For the Six Months Ended
	June 30, 2014		June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Operating income	$	7,722	$	3,235		$	15,791		$	14,115
Other non-operating income (expense), net		8		(1,054	)		(924	)		(922	)
Net transaction gains	$	7,730	$	2,181		$	14,867		$	13,193

19. Income Taxes

Mattel’s benefit for income taxes was $40.9 million for the six months ended June 30, 2014, as compared to a provision for income taxes of $11.0 million for the six months ended June 30, 2013. During the three and six months ended June 30, 2014, Mattel recognized net discrete tax benefits of $40.1 million and $36.4 million, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions around the world, settlements, and enacted tax law changes. During the three and six months ended June 30, 2013, Mattel recognized net discrete tax benefits of $11.2 million and $15.2 million, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions around the world, settlements, and enacted tax law changes.

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In the first quarter of 2014, Mattel adopted Accounting Standards Update (“ASU”) 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists, which generally requires an unrecognized tax benefit, or a portion of an unrecognized tax benefit, to be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. However, to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date to settle any additional income taxes that would result from the disallowance of a tax position or the applicable tax law does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. Mattel reclassified unrecognized tax benefits of approximately $44 million, primarily recorded within other noncurrent liabilities, against its noncurrent deferred tax assets upon adoption in the first quarter of 2014. There was no impact on Mattel’s operating results.

In the normal course of business, Mattel is regularly audited by federal, state, and foreign tax authorities. In May 2014, the IRS completed its audit of Mattel’s 2010 and 2011 federal income tax returns. Additionally, the statutes of limitations lapsed with respect to other domestic and foreign jurisdictions. As a result of these events, Mattel recognized net discrete tax benefits of $40.1 million during the three months ended June 30, 2014.

Based on the current status of federal, state, and foreign audits, Mattel believes it is reasonably possible that in the next twelve months, the total unrecognized tax benefits could decrease by approximately $38 million related to the settlement of tax audits and/or the expiration of statutes of limitations. The ultimate settlement of any particular issue with the applicable taxing authority could have a material impact on Mattel’s consolidated financial statements.

20. Contingencies

Litigation Related to Carter Bryant and MGA Entertainment, Inc.

In April 2004, Mattel filed a lawsuit in Los Angeles County Superior Court against Carter Bryant (“Bryant”), a former Mattel design employee. The suit alleges that Bryant aided and assisted a Mattel competitor, MGA Entertainment, Inc. (“MGA”), during the time he was employed by Mattel, in violation of his contractual and other duties to Mattel. In September 2004, Bryant asserted counterclaims against Mattel, including counterclaims in which Bryant sought, as a putative class action representative, to invalidate Mattel’s Confidential Information and Proprietary Inventions Agreements with its employees. Bryant also removed Mattel’s suit to the United States District Court for the Central District of California. In December 2004, MGA intervened as a party-defendant in Mattel’s action against Bryant, asserting that its rights to Bratz properties are at stake in the litigation.

Separately, in November 2004, Bryant filed an action against Mattel in the United States District Court for the Central District of California. The action sought a judicial declaration that Bryant’s purported conveyance of rights in Bratz was proper and that he did not misappropriate Mattel property in creating Bratz.

In April 2005, MGA filed suit against Mattel in the United States District Court for the Central District of California. MGA’s action alleges claims of trade dress infringement, trade dress dilution, false designation of origin, unfair competition, and unjust enrichment. The suit alleges, among other things, that certain products, themes, packaging, and/or television commercials in various Mattel product lines have infringed upon products, themes, packaging, and/or television commercials for various MGA product lines, including Bratz. The complaint also asserts that various alleged Mattel acts with respect to unidentified retailers, distributors, and licensees have damaged MGA and that various alleged acts by industry organizations, purportedly induced by Mattel, have damaged MGA. MGA’s suit alleges that MGA has been damaged in an amount “believed to reach or exceed tens of millions of dollars” and further seeks punitive damages, disgorgement of Mattel’s profits and injunctive relief.

In June 2006, the three cases were consolidated in the United States District Court for the Central District of California. On July 17, 2006, the Court issued an order dismissing all claims that Bryant had asserted against Mattel, including Bryant’s purported counterclaims to invalidate Mattel’s Confidential Information and Proprietary Inventions Agreements with its employees, and Bryant’s claims for declaratory relief.

In November 2006, Mattel asked the Court for leave to file an Amended Complaint that included not only additional claims against Bryant, but also included claims for copyright infringement, Racketeer Influenced and Corrupt Organizations (“RICO”) violations, misappropriation of trade secrets, intentional interference with contract, aiding and abetting breach of fiduciary duty and breach of duty of loyalty, and unfair competition, among others, against MGA, its Chief Executive Officer Isaac Larian, certain MGA affiliates and an MGA employee. The RICO claim alleged that MGA stole Bratz and then, by recruiting and hiring key Mattel employees and directing them to bring with them Mattel confidential and proprietary information, unfairly competed against Mattel using Mattel’s trade secrets, confidential information, and key employees to build their business. On January 12, 2007, the Court granted Mattel leave to file these claims as counterclaims in the consolidated cases, which Mattel did that same day.

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Mattel sought to try all of its claims in a single trial, but in February 2007, the Court decided that the consolidated cases would be tried in two phases, with the first trial to determine claims and defenses related to Mattel’s ownership of Bratz works and whether MGA infringed those works. On May 19, 2008, Bryant reached a settlement agreement with Mattel and is no longer a defendant in the litigation. In the public stipulation entered by Mattel and Bryant in connection with the resolution, Bryant agreed that he was and would continue to be bound by all prior and future Court Orders relating to Bratz ownership and infringement, including the Court’s summary judgment rulings.

The first phase of the first trial, which began on May 27, 2008, resulted in a unanimous jury verdict on July 17, 2008 in favor of Mattel. The jury found that almost all of the Bratz design drawings and other works in question were created by Bryant while he was employed at Mattel; that MGA and Isaac Larian intentionally interfered with the contractual duties owed by Bryant to Mattel, aided and abetted Bryant’s breaches of his duty of loyalty to Mattel, aided and abetted Bryant’s breaches of the fiduciary duties he owed to Mattel, and converted Mattel property for their own use. The same jury determined that defendants MGA, Larian, and MGA Entertainment (HK) Limited infringed Mattel’s copyrights in the Bratz design drawings and other Bratz works, and awarded Mattel total damages of approximately $100 million against the defendants. On December 3, 2008, the Court issued a series of orders rejecting MGA’s equitable defenses and granting Mattel’s motions for equitable relief, including an order enjoining the MGA party defendants from manufacturing, marketing, or selling certain Bratz fashion dolls or from using the “Bratz” name. The Court stayed the effect of the December 3, 2008 injunctive orders until further order of the Court and entered a further specified stay of the injunctive orders on January 7, 2009.

The parties filed and argued additional motions for post-trial relief, including a request by MGA to enter judgment as a matter of law on Mattel’s claims in MGA’s favor and to reduce the jury’s damages award to Mattel. Mattel additionally moved for the appointment of a receiver. On April 27, 2009, the Court entered an order confirming that Bratz works found by the jury to have been created by Bryant during his Mattel employment were Mattel’s property and that hundreds of Bratz female fashion dolls infringe Mattel’s copyrights. The Court also upheld the jury’s award of damages in the amount of $100 million and ordered an accounting of post-trial Bratz sales. The Court further vacated the stay of the December 3, 2008 orders, except to the extent specified by the Court’s January 7, 2009 modification.

MGA appealed the Court’s equitable orders to the Court of Appeals for the Ninth Circuit. On December 9, 2009, the Ninth Circuit heard oral argument on MGA’s appeal and issued an order staying the District Court’s equitable orders pending a further order to be issued by the Ninth Circuit. The Ninth Circuit opinion vacating the relief ordered by the District Court was issued on July 22, 2010. The Ninth Circuit stated that, because of several jury instruction errors it identified, a significant portion—if not all—of the jury verdict and damage award should be vacated.

In its opinion, the Ninth Circuit found that the District Court erred in concluding that Mattel’s Invention Agreement unambiguously applied to “ideas;” that it should have considered extrinsic evidence in determining the application of the agreement; and if the conclusion turns on conflicting evidence, it should have been up to the jury to decide. The Ninth Circuit also concluded that the District Judge erred in transferring the entire brand to Mattel based on misappropriated names and that the Court should have submitted to the jury, rather than deciding itself, whether Bryant’s agreement assigned works created outside the scope of his employment and whether Bryant’s creation of the Bratz designs and sculpt was outside of his employment. The Court then went on to address copyright issues which would be raised after a retrial, since Mattel “might well convince a properly instructed jury” that it owns Bryant’s designs and sculpt. The Ninth Circuit stated that the sculpt itself was entitled only to “thin” copyright protection against virtually identical works, while the Bratz sketches were entitled to “broad” protection against substantially similar works; in applying the broad protection, however, the Ninth Circuit found that the lower court had erred in failing to filter out all of the unprotectable elements of Bryant’s sketches. This mistake, the Court said, caused the lower court to conclude that all Bratz dolls were substantially similar to Bryant’s original sketches.

Judge Stephen Larson, who presided over the first trial, retired from the bench during the course of the appeal, and the case was transferred to Judge David O. Carter. After the transfer, Judge Carter granted Mattel leave to file a Fourth Amended Answer and Counterclaims which focused on RICO, trade secret and other claims, and added additional parties, and subsequently granted in part and denied in part a defense motion to dismiss those counterclaims.

Later, on August 16, 2010, MGA asserted several new claims against Mattel in response to Mattel’s Fourth Amended Answer and Counterclaims, including claims for alleged trade secret misappropriation, an alleged violation of RICO, and wrongful injunction. Mattel moved to strike and/or dismiss these claims, as well as certain MGA allegations regarding Mattel’s motives for filing suit. The Court granted that motion as to the wrongful injunction claim, which it dismissed with prejudice, and as to the allegations about Mattel’s motives, which it struck. The Court denied the motion as to MGA’s trade secret misappropriation claim and its claim for violations of RICO.

The Court resolved summary judgment motions in late 2010. Among other rulings, the Court dismissed both parties’ RICO claims; dismissed Mattel’s claim for breach of fiduciary duty and portions of other claims as “preempted” by the trade secrets act; dismissed MGA’s trade dress infringement claims; dismissed MGA’s unjust enrichment claim; dismissed MGA’s common law unfair competition claim; and dismissed portions of Mattel’s copyright infringement claim as to “later generation” Bratz dolls.

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Trial of all remaining claims began in early January 2011. During the trial, and before the case was submitted to the jury, the Court granted MGA’s motions for judgment as to Mattel’s claims for aiding and abetting breach of duty of loyalty and conversion. The Court also granted a defense motion for judgment on portions of Mattel’s claim for misappropriation of trade secrets relating to thefts by former Mattel employees located in Mexico.

The jury reached verdicts on the remaining claims in April 2011. In those verdicts, the jury ruled against Mattel on its claims for ownership of Bratz-related works, for copyright infringement, and for misappropriation of trade secrets. The jury ruled for MGA on its claim of trade secret misappropriation as to 26 of its claimed trade secrets and awarded $88.5 million in damages. The jury ruled against MGA as to 88 of its claimed trade secrets. The jury found that Mattel’s misappropriation was willful and malicious.

In early August 2011, the Court ruled on post-trial motions. The Court rejected MGA’s unfair competition claims and also rejected Mattel’s equitable defenses to MGA’s misappropriation of trade secrets claim. The Court reduced the jury’s damages award of $88.5 million to $85.0 million. The Court awarded MGA an additional $85.0 million in punitive damages and approximately $140 million in attorney’s fees and costs. The Court entered a judgment which totaled approximately $310 million in favor of MGA.

On August 11, 2011, Mattel appealed the judgment, challenging on appeal the entirety of the District Court’s monetary award in favor of MGA, including both the award of $170 million in damages for alleged trade secret misappropriation and approximately $140 million in attorney’s fees and costs. On January 24, 2013, the Ninth Circuit Court of Appeals issued a ruling on Mattel’s appeal. In that ruling, the Court found that MGA’s claim for trade secrets misappropriation was not compulsory to any Mattel claim and could not be filed as a counterclaim-in-reply. Accordingly, the Court of Appeals vacated the portion of the judgment awarding damages and attorney’s fees and costs to MGA for prevailing on its trade secrets misappropriation claim, totaling approximately $172.5 million. It ruled that, on remand, the District Court must dismiss MGA’s trade secret claim without prejudice. In its ruling, the Court of Appeals also affirmed the District Court’s award of attorney’s fees and costs under the Copyright Act. Accordingly, Mattel recorded a litigation accrual of approximately $138 million during the fourth quarter of 2012 to cover these fees and costs.

Because multiple claimants asserted rights to the attorney’s fees portion of the judgment, on February 13, 2013, Mattel filed a motion in the district court for orders permitting Mattel to interplead the proceeds of the judgment and releasing Mattel from liability to any claimant based on Mattel’s payment of the judgment.

On February 27, 2013, MGA filed a motion for leave to amend its prior complaint in the existing federal court lawsuit so that it could reassert its trade-secrets claim. Mattel opposed that motion. On December 17, 2013, the district court denied MGA’s motion for leave to amend and entered an order dismissing MGA’s trade-secrets claim without prejudice. Also on December 17, 2013, following a settlement between MGA and certain insurance carriers, the district court denied Mattel’s motion for leave to interplead the proceeds of the judgment.

On December 21, 2013, a stipulation regarding settlement with insurers and payment of judgment was filed in the district court, which provided that (i) Mattel would pay approximately $138 million, including accrued interest, in full satisfaction of the copyright fees judgment, (ii) all parties would consent to entry of an order exonerating and discharging the appeal bond posted by Mattel, and (iii) MGA’s insurers would dismiss all pending actions related to the proceeds of the copyright fees judgment, including an appeal by Evanston Insurance Company in an action against Mattel that was pending in the Ninth Circuit. On December 23, 2013, Mattel paid the copyright fees judgment in the total sum, including interest, of approximately $138 million. On December 26, 2013, the court entered an order exonerating and discharging the appeal bond posted by Mattel, and on December 27, 2013, MGA filed an acknowledgment of satisfaction of judgment. On December 30, 2013, Evanston Insurance Company’s appeal in its action against Mattel was dismissed.

On January 13, 2014, MGA filed a new, but virtually identical, trade-secrets claim against Mattel in Los Angeles County Superior Court. Mattel was served with the complaint on January 23, 2014. In its complaint, MGA purports to seek damages in excess of $1 billion. Mattel believes that MGA’s claim should be barred as a matter of law, and intends to vigorously defend against it. Accordingly, Mattel believes that the risk that Mattel will incur a loss on this claim is remote, and therefore, a liability has not been accrued as of June 30, 2014.

Litigation Related to Yellowstone do Brasil Ltda.

Yellowstone do Brasil Ltda. (formerly known as Trebbor Informática Ltda.) was a customer of Mattel’s subsidiary Mattel do Brasil Ltda. when a commercial dispute arose between Yellowstone and Mattel do Brasil regarding the supply of product and related payment terms. As a consequence of the dispute, in April 1999, Yellowstone filed a declarative action against Mattel do Brasil requesting the annulment of its security bonds and promissory notes given to Mattel as well as requesting the court to find Mattel do Brasil liable for damages incurred as a result of Mattel do Brasil’s alleged abrupt and unreasonable breach of an oral exclusive distribution agreement between the parties relating to the supply and sale of toys in Brazil. Yellowstone’s complaint sought alleged loss of profits of approximately $1 million (historical value), plus an unspecified amount of damages consisting of: (i) compensation for all investments made by Yellowstone to develop Mattel do Brasil’s business; (ii) reimbursement of the amounts paid by Yellowstone to terminate labor and civil contracts in connection with the business; (iii) compensation for alleged unfair competition and for the goodwill of trade; and (iv) compensation for non-pecuniary damages.

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Mattel do Brasil filed its defenses to these claims and simultaneously presented a counterclaim for unpaid accounts receivable for goods supplied to Yellowstone in the approximate amount of $4 million (historical value).

During the evidentiary phase a first accounting report was submitted by a court-appointed expert. Such report stated that Yellowstone had invested approximately $3 million in its business (historical value). Additionally, the court-appointed expert calculated a loss of profits compensation of approximately $1 million (historical value). Mattel do Brasil challenged the report since it was not made based on the official accounting documents of Yellowstone and since the report calculated damages based only on documents unilaterally submitted by Yellowstone.

The trial court accepted the challenge and ruled that a second accounting examination should take place in the lawsuit. Yellowstone appealed the decision but it was upheld by the appeals court.

The second court-appointed expert’s report submitted at trial did not assign a value to any of Yellowstone’s claims and found no evidence of causation between Mattel do Brasil’s actions and such claims.

In January 2010, the trial court ruled in favor of Mattel do Brasil and denied all of Yellowstone’s claims based primarily on the lack of any causal connection between the acts of Mattel do Brasil and Yellowstone’s alleged damages. Additionally, the court upheld Mattel do Brasil’s counterclaim and ordered Yellowstone to pay Mattel do Brasil approximately $4 million (historical value). The likelihood of Mattel do Brasil recovering this amount was uncertain due to the fact that Yellowstone was declared insolvent and filed for bankruptcy protection. In February 2010, Yellowstone filed a motion seeking clarification of the decision which was denied.

In September 2010, Yellowstone filed a further appeal. Under Brazilian law, the appeal was de novo and Yellowstone restated all of the arguments it made at the trial court level. Yellowstone did not provide any additional information supporting its unspecified alleged damages. The appeals court held hearings on the appeal in March and April 2013. On July 26, 2013, the appeals court awarded Yellowstone approximately $17 million in damages, as adjusted for inflation and interest. The appeals court also awarded Mattel approximately $8 million on its counterclaim, as adjusted for inflation. On August 2, 2013, Mattel filed a motion for clarification since the written decision contained clear errors in terms of amounts awarded and interest and inflation adjustments. Mattel’s motion also asked the court to decide whether Yellowstone’s award could be offset by the counterclaim award, despite Yellowstone’s status as a bankrupt entity. Yellowstone also filed a motion for clarification on August 5, 2013. A decision on the clarification motions is expected in the third quarter of 2014. Mattel intends to appeal the appeals court decision to the Superior Court based on both procedural and substantive grounds.

Mattel believes that it is reasonably possible that a loss in this matter could range from $0 to approximately $22 million. The high end of this range, approximately $22 million, is based on the calculation of the current amount of the damages and loss of profits, including interest and inflation adjustments, reported in the first court-appointed examination report submitted in the lawsuit, plus attorney’s fees. Mattel do Brasil may be entitled to offset its counterclaim award of approximately $9 million, current amount including inflation adjustment, against such loss. The existence of pending motions for clarification filed by both parties and the resulting clarification decision expected to be issued in the third quarter of 2014, as well as the procedural aspects of an appeal to the Superior Court, adds some uncertainty to the final outcome of the matter. Mattel is awaiting the outcome of the clarification decision before it files an appeal with the Superior Court. Mattel believes, however, that it has valid legal grounds for appeal of the appeals court decision and does not believe that a loss is probable for this matter. Accordingly, a liability has not been accrued as of June 30, 2014. Mattel may be required by the trial court to place a bond or the full amount of the damage award in escrow pending an appeal decision by the Superior Court.

21. Segment Information

Mattel, through its subsidiaries, sells a broad variety of toy products which are grouped into four major brand categories, including the introduction of the Construction and Arts & Crafts brand category in the second quarter of 2014:

Mattel Girls & Boys Brands—including Barbie^® fashion dolls and accessories (“Barbie”), Monster High^®, Disney Classics^®, Ever After High^®, Little Mommy^®, and Polly Pocket (collectively “Other Girls”), Hot Wheels^® and Matchbox^® vehicles and play sets (collectively “Wheels”), and CARS^®, Disney Planes™, Radica^®, Toy Story^®, Max Steel^®, WWE^® Wrestling, Batman^®, and games and puzzles (collectively “Entertainment”).

Fisher-Price Brands—including Fisher-Price^®, Little People^®, BabyGear™, Laugh & Learn^®, and Imaginext^® (collectively “Core Fisher-Price”), Thomas & Friends^®, Dora the Explorer^®, Mickey Mouse^® Clubhouse, and Disney Jake and the Never Land Pirates^® (collectively “Fisher-Price Friends”), and Power Wheels^®.

American Girl Brands—including My American Girl^®, the historical collection, and Bitty Baby^®. American Girl Brands products are sold directly to consumers via its catalog, website, and proprietary retail stores. Its children’s publications are also sold to certain retailers.

Construction and Arts & Crafts Brands—including MEGA BLOKS^®, RoseArt^®, and Board Dudes^®.

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Mattel’s operating segments are: (i) North America, which consists of the US and Canada, (ii) International, and (iii) American Girl. The North America and International segments sell products in the Mattel Girls & Boys Brands, Fisher-Price Brands, and Construction and Arts & Crafts Brands categories, although some are developed and adapted for particular international markets.

Segment Data

The following tables present information about revenues, income, and assets by segment. Mattel does not include sales adjustments such as trade discounts and other allowances in the calculation of segment revenues (referred to as “gross sales” and reconciled to net sales in Part I, Item 2 “Non-GAAP Financial Measure” of this Quarterly Report on Form 10-Q). Mattel records these adjustments in its financial accounting systems at the time of sale to each customer, but the adjustments are not allocated to individual products. For this reason, Mattel’s chief operating decision maker uses gross sales by segment as one of the metrics to measure segment performance. Such sales adjustments are included in the determination of segment income from operations based on the adjustments recorded in the financial accounting systems. Segment income represents each segment’s operating income, while consolidated operating income represents income from operations before net interest, other non-operating (income) expense, and income taxes as reported in the consolidated statements of operations. The corporate and other expense category includes costs not allocated to individual segments, including charges related to incentive compensation, share-based payments, and corporate headquarters functions managed on a worldwide basis, and the impact of changes in foreign currency rates on intercompany transactions.

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Revenues by Segment
North America	$	513,463		$	566,471		$	954,894		$	1,022,940
International		569,936			627,896			1,059,175			1,154,907
American Girl		87,731			83,757			198,289			188,707
Gross sales		1,171,130			1,278,124			2,212,358			2,366,554
Sales adjustments		(108,878	)		(109,015	)		(203,929	)		(201,839	)
Net sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715
Segment Income (Loss)
North America	$	39,497		$	83,966		$	88,220		$	152,093
International		30,854			77,100			62,334			139,095
American Girl		(1,263	)		(4,792	)		7,981			7,163
		69,088			156,274			158,535			298,351
Corporate and other expense (a)		(68,080	)		(61,484	)		(151,309	)		(137,730	)
Operating income		1,008			94,790			7,226			160,621
Interest expense		18,965			18,259			36,211			38,596
Interest (income)		(2,186	)		(1,289	)		(3,465	)		(2,689	)
Other non-operating (income) expense, net		(1,400	)		(909	)		(1,728	)		1,820
(Loss) Income before income taxes	$	(14,371	)	$	78,729		$	(23,792	)	$	122,894

(a) Corporate and other expense includes severance and other termination-related costs of $12.6 million and $34.1 million for the three and six months ended June 30, 2014, respectively, and $8.0 million and $13.5 million for the three and six months ended June 30, 2013, respectively, and share-based compensation expense of $11.8 million and $24.5 million for the three and six months ended June 30, 2014, respectively, and $13.7 million and $27.6 million for the three and six months ended June 30, 2013, respectively.

Segment assets are comprised of accounts receivable and inventories, net of applicable reserves and allowances.

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Assets by Segment
North America	$	700,968	$	645,334	$	723,886
International		835,707		850,907		920,770
American Girl		135,395		117,011		100,438
		1,672,070		1,613,252		1,745,094
Corporate and other		92,147		126,086		83,854
Accounts receivable and inventories, net	$	1,764,217	$	1,739,338	$	1,828,948

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The table below presents worldwide revenues by brand category:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Worldwide Revenues by Brand Category
Mattel Girls & Boys Brands	$	688,977		$	792,428		$	1,345,838		$	1,484,598
Fisher-Price Brands		328,766			396,730			600,209			683,995
American Girl Brands		83,146			78,174			189,084			178,629
Construction and Arts & Crafts Brands		61,600			—			61,600			—
Other		8,641			10,792			15,627			19,332
Gross sales		1,171,130			1,278,124			2,212,358			2,366,554
Sales adjustments		(108,878	)		(109,015	)		(203,929	)		(201,839	)
Net sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715

22. New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) 605, Revenue Recognition, and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance establishes a five-step model to achieve that core principle and also requires additional disclosures about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. ASU 2014-09 will be effective for interim and annual reporting periods beginning after December 15, 2016. Early application is not permitted. Mattel is currently evaluating the impact of the adoption of ASU 2014-09 on its operating results and financial position.

In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, which requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. ASU 2014-12 will be effective for interim and annual reporting periods beginning after December 15, 2015. Early application is permitted. Mattel is currently evaluating the impact of the adoption of ASU 2014-12 on its operating results and financial position.

23. Subsequent Event

On July 17, 2014, Mattel announced that its Board of Directors declared a third quarter dividend of $0.38 per common share. The dividend is payable on September 19, 2014 to stockholders of record on August 27, 2014.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

In the discussion that follows, “Mattel” refers to Mattel, Inc. and/or one or more of its family of companies.

The following discussion should be read in conjunction with the consolidated financial information and related notes that appear in Part I, Item 1 of this Quarterly Report on Form 10-Q. Mattel’s business is seasonal with consumers making a large percentage of all toy purchases during the traditional holiday season; therefore, results of operations are comparable only with corresponding periods.

Factors That May Affect Future Results

(Cautionary Statement Under the Private Securities Litigation Reform Act of 1995)

Mattel is including this Cautionary Statement to caution readers and to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (the “Act”) for forward-looking statements. This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the Act. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believes,” “expects,” “anticipates,” “intends,” “plans,” “seeks,” “aims,” “estimates,” “projects,” “on track” or words of similar meaning, or future or conditional verbs, such as “will,” “should,” “could,” or “may.” A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. Investors should not place undue reliance on the forward-looking statements, which speak only as of the date of this Form 10-Q. These forward-looking statements are all based on currently available operating, financial, economic and competitive information and are subject to various risks and uncertainties. The Company’s actual future results and trends may differ materially depending on a variety of factors, including, but not limited to, the risks and uncertainties detailed in Part 1, Item 1A “Risk Factors” in Mattel’s 2013 Annual Report on Form 10-K.

Overview

Mattel designs, manufactures, and markets a broad variety of toy products worldwide which are sold to its customers and directly to consumers. Mattel’s vision is “creating the future of play.” Mattel’s objectives are to grow its share in the marketplace, continue to improve its operating margins, and create long-term stockholder value. To achieve these objectives, management has established the following strategies:

The first strategy is to deliver consistent growth by investing in its core brands, optimizing entertainment partnerships, building new franchises, and working to expand and leverage its international footprint.

The second strategy is to optimize operating margins through sustaining gross margins within the low-to-mid 50% range in the near-term and above 50% in the long-term, and delivering on cost savings initiatives.

The third strategy is to generate significant cash flow and continue its disciplined, opportunistic, and value-enhancing deployment.

Mattel believes its products are among the most widely recognized toy products in the world. Mattel’s portfolio of brands and products are grouped into the following categories:

Mattel Girls & Boys Brands—including Barbie fashion dolls and accessories (“Barbie”), Monster High, Disney Classics, Ever After High, Little Mommy, and Polly Pocket (collectively “Other Girls”), Hot Wheels and Matchbox vehicles and play sets (collectively “Wheels”), and CARS, Disney Planes, Radica, Toy Story, Max Steel, WWE Wrestling, Batman, and games and puzzles (collectively “Entertainment”).

Fisher-Price Brands—including Fisher-Price, Little People, BabyGear, Laugh & Learn, and Imaginext (collectively “Core Fisher-Price”), Thomas & Friends, Dora the Explorer, Mickey Mouse Clubhouse, and Disney Jake and the Never Land Pirates (collectively “Fisher-Price Friends”), and Power Wheels.

American Girl Brands—including My American Girl, the historical collection, and Bitty Baby. American Girl Brands products are sold directly to consumers via its catalog, website, and proprietary retail stores. Its children’s publications are also sold to certain retailers.

Construction and Arts & Crafts Brands—including MEGA BLOKS, RoseArt, and Board Dudes.

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Second Quarter 2014 Overview

Although Mattel’s results for the second quarter did not meet management’s expectations, Mattel made significant progress across a number of initiatives to be better positioned in the second half of the year and beyond. These initiatives include completing the acquisition of MEGA Brands, reducing inventory levels, strengthening its management team, shifting marketing spend to the back half of the year, and tightly managing other selling and administrative expenses. As Mattel moves into the second half of the year and the holiday season, it will focus on improving its operating results by bringing innovative products to market, making additional advertising investments, and optimizing the effectiveness of its marketing spend.

Mattel’s second quarter 2014 financial highlights include the following:

• Net sales for the second quarter of 2014 were $1.06 billion, down 9% as compared to second quarter of 2013 net sales of $1.17 billion.

• Gross profit as a percentage of net sales for the second quarter of 2014 was 46.4%, a decrease of 490 basis points from the second quarter of 2013.

• Other selling and administrative expenses in the second quarter of 2014 were $391.7 million, including MEGA Brands’ transaction, integration, and amortization costs of approximately $16 million, as compared to other selling and administrative expenses of $391.8 million, including an asset impairment charge of approximately $14 million, during the second quarter of 2013.

• Operating income in the second quarter of 2014 was $1.0 million, as compared to $94.8 million in 2013.

• Mattel paid a second quarter dividend of $0.38 per common share, an increase of 6% as compared to the second quarter 2013 dividend of $0.36 per common share.

• Mattel repurchased 2.6 million shares of its common stock during the second quarter of 2014 at a cost of approximately $100 million.

Results of Operations—Second Quarter

Consolidated Results

Net sales for the second quarter of 2014 were $1.06 billion, a 9% decrease, as compared to $1.17 billion in the second quarter of 2013, with an unfavorable impact from changes in currency exchange rates of 1 percentage point. Net income for the second quarter of 2014 was $28.3 million, or $0.08 per diluted share, as compared to net income of $73.3 million, or $0.21 per diluted share, in the second quarter of 2013. Net income for the second quarter of 2014 was negatively impacted by lower sales volume and lower gross margins, partially offset by a net discrete tax benefit and lower advertising and promotion expenses.

The following table provides a summary of Mattel’s consolidated results for the second quarter of 2014 and 2013 (in millions, except percentage and basis point information):

	For the Three Months Ended June 30,												Year/Year Change
	2014						2013
	Amount			% of Net Sales			Amount			% of Net Sales			%			Basis Points of Net Sales
Net sales	$	1,062.3			100.0	%	$	1,169.1			100.0	%		–9	%		—
Gross profit	$	492.6			46.4	%	$	600.0			51.3	%		–18	%		–490
Advertising and promotion expenses		99.9			9.4			113.4			9.7			–12	%		–30
Other selling and administrative expenses		391.7			36.9			391.8			33.5			—			340
Operating income		1.0			0.1			94.8			8.1			–99	%		–800
Interest expense		19.0			1.8			18.3			1.6			4	%		20
Interest (income)		(2.2	)		–0.2			(1.3	)		–0.1			70	%		–10
Other non-operating (income), net		(1.4	)					(0.9	)
(Loss) income before income taxes	$	(14.4	)		–1.4	%	$	78.7			6.7	%		–118	%		–810

Sales

Net sales for the second quarter of 2014 were $1.06 billion, a 9% decrease, as compared to $1.17 billion in the second quarter of 2013, with an unfavorable impact from changes in currency exchange rates of 1 percentage point.

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The following table provides a summary of Mattel’s consolidated gross sales by brand results for the second quarter of 2014 and 2013:

	For the Three Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
Mattel Girls & Boys Brands:
Barbie	$	160.8	$	189.2		–15	%
Other Girls		210.9		238.2		–11	%
Wheels		139.9		144.7		–3	%
Entertainment		177.4		220.3		–19	%
		689.0		792.4		–13	%
Fisher-Price Brands:
Core Fisher-Price		218.5		260.0		–16	%
Fisher-Price Friends		89.6		113.8		–21	%
Other Fisher-Price		20.7		22.9		–10	%
		328.8		396.7		–17	%
American Girl Brands		83.1		78.2		6	%
Construction and Arts & Crafts Brands		61.6		—		100	%
Other		8.6		10.8
Total Gross Sales	$	1,171.1	$	1,278.1		–8	%

Gross sales for Mattel were $1.17 billion in the second quarter of 2014, down $107.0 million or 8%, as compared to $1.28 billion in the second quarter of 2013, with an unfavorable impact from changes in currency exchange rates of 1 percentage point. The decrease in gross sales was due to lower sales of Fisher-Price Friends, Entertainment, Core Fisher-Price, Barbie, and Other Girls products, partially offset by Construction and Arts & Crafts products. Of the 21% decrease in Fisher-Price Friends gross sales, 6% was due to lower sales of Thomas & Friends products, 5% was due to lower sales of Mike the Knight^® products, and 4% was due to lower sales of Nickelodeon^® products. Of the 19% decrease in Entertainment gross sales, 14% was due to lower sales of Superman^® products and 4% was due to lower sales of CARS products. Of the 16% decrease in Core Fisher-Price gross sales, 5% was due to lower sales of Little People products and 5% was due to lower sales of Imaginext products. The 15% decrease in Barbie gross sales was due to lower consumer takeaway, and higher retail inventory levels from prior year in certain international markets. Of the 11% decrease in Other Girls gross sales, 26% was due to lower sales of Monster High products, partially offset by higher sales of Disney Princess^® products of 10%. The increase in Construction and Arts & Crafts gross sales was due to initial sales of MEGA Brands products.

Cost of Sales

Cost of sales as a percentage of net sales was 53.6% in the second quarter of 2014, as compared to 48.7% in the second quarter of 2013. Cost of sales increased by $0.6 million from $569.1 million in the second quarter of 2013 to $569.7 million in the second quarter of 2014, as compared to a 9% decrease in net sales. Within cost of sales, product and other costs increased by $7.4 million, or 2%, from $453.7 million in the second quarter of 2013 to $461.1 million in the second quarter of 2014; freight and logistics expenses increased by $1.3 million, or 2%, from $65.0 million in the second quarter of 2013 to $66.3 million in the second quarter of 2014; and royalty expense decreased by $8.1 million, or 16%, from $50.4 million in the second quarter of 2013 to $42.3 million in the second quarter of 2014.

Gross Profit

Gross profit as a percentage of net sales decreased from 51.3% in the second quarter of 2013 to 46.4% in the second quarter of 2014. The decrease in gross profit as a percentage of net sales was primarily due to the impact of the MEGA Brands acquisition, including the impact of the inventory fair value markup above historical cost, the impact of lower sales volume on Mattel’s fixed cost manufacturing and distribution base, efforts to reduce inventory levels, including higher close-out sales, unfavorable product mix, and higher input costs partially offset by price increases and Operational Excellence 3.0 savings.

Advertising and Promotion Expenses

Advertising and promotion expenses primarily consist of: (i) media costs, which primarily include the media, planning, and buying fees for television, print, and online advertisements, (ii) non-media costs, which primarily include commercial and website production, merchandising, and promotional costs, (iii) retail advertising costs, which primarily include consumer direct catalogs, newspaper inserts, fliers, and mailers and (iv) generic advertising costs, which primarily include trade show costs. Advertising and promotion expenses as a percentage of net sales decreased from 9.7% in the second quarter of 2013 to 9.4% in the second quarter of 2014, primarily due to efforts to improve the effectiveness of advertising and a shift in the timing of advertising to later in the year.

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Other Selling and Administrative Expenses

Other selling and administrative expenses were $391.7 million, or 36.9% of net sales, in the second quarter of 2014, as compared to $391.8 million, or 33.5% of net sales, in the second quarter of 2013. Other selling and administrative expenses were flat as approximately $16 million of transaction, integration, and amortization costs associated with the MEGA Brands acquisition were partially offset by the absence of a 2013 asset impairment charge of approximately $14 million.

Non-Operating Items

Interest expense increased by $0.7 million from $18.3 million in the second quarter of 2013 to $19.0 million in the second quarter of 2014, primarily due to higher average outstanding borrowings.

Provision for Income Taxes

Mattel’s benefit for income taxes was $42.7 million in the second quarter of 2014, as compared to a provision for income taxes of $5.4 million in the second quarter of 2013. Mattel recognized net discrete tax benefits of $40.1 million and $11.2 million in the second quarter of 2014 and 2013, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions, settlements, and enacted tax law changes.

North America Segment

The following table provides a summary of Mattel’s gross sales by brand for the North America segment for the second quarter of 2014 and 2013:

	For the Three Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
Mattel Girls & Boys Brands:
Barbie	$	55.5	$	65.8		–16	%
Other Girls		93.8		102.5		–8	%
Wheels		55.7		59.0		–6	%
Entertainment		86.9		102.9		–16	%
		291.9		330.2		–12	%
Fisher-Price Brands:
Core Fisher-Price		107.6		145.2		–26	%
Fisher-Price Friends		47.7		66.4		–28	%
Other Fisher-Price		19.7		21.3		–8	%
		175.0		232.9		–25	%
Construction and Arts & Crafts Brands		43.1		—		100	%
Other		3.5		3.3
Total Gross Sales	$	513.5	$	566.4		–9	%

Gross sales for the North America segment were $513.5 million in the second quarter of 2014, down $52.9 million or 9%, with no impact from changes in currency exchange rates, as compared to $566.4 million in the second quarter of 2013. The decrease in the North America segment gross sales was primarily due to lower sales of Fisher-Price Friends, Core Fisher-Price, Entertainment, and Barbie products, partially offset by Construction and Arts & Crafts products. Of the 28% decrease in Fisher-Price Friends gross sales, 11% was due to lower sales of Thomas & Friends products, 7% was due to lower sales of Mike the Knight products, and 4% was due to lower sales of Nickelodeon products. Of the 26% decrease in Core Fisher-Price gross sales, 8% was due to lower sales of Little People products and 7% was due to lower sales of Imaginext products. Of the 16% decrease in Entertainment gross sales, 17% was due to lower sales of Superman products. The 16% decrease in Barbie gross sales was due to lower consumer takeaway. The increase in Construction and Arts & Crafts gross sales was due to initial sales of MEGA Brands products. Cost of sales increased 1% in the second quarter of 2014, compared to an 11% decrease in net sales, primarily due to higher product and other costs, partially offset by lower royalty expense. Gross margins decreased as a result of the impact of the MEGA Brands acquisition, including the impact of the inventory fair value markup above historical cost, the impact of lower sales volume on Mattel’s fixed cost manufacturing and distribution base, and higher input costs partially offset by price increases and Operational Excellence 3.0 savings.

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North America segment income decreased by 53% to $39.5 million in the second quarter of 2014, as compared to $84.0 million in the second quarter of 2013, primarily due to lower gross profit, partially offset by lower advertising and promotion expenses and lower other selling and administrative expenses.

International Segment

The following table provides a summary of percentage changes in gross sales within the International segment in the second quarter of 2014 versus 2013:

	% Change in Gross Sales		Impact of Change in Currency Rates (in % pts)
Total International Segment		–9		–2
Europe		–8		1
Latin America		–11		–6
Asia Pacific		–9		–1

The following table provides a summary of Mattel’s gross sales by brand for the International segment for the second quarter of 2014 and 2013:

	For the Three Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
Mattel Girls & Boys Brands:
Barbie	$	105.3	$	123.4		–15	%
Other Girls		117.1		135.7		–14	%
Wheels		84.2		85.7		–2	%
Entertainment		90.5		117.4		–23	%
		397.1		462.2		–14	%
Fisher-Price Brands:
Core Fisher-Price		110.9		114.8		–3	%
Fisher-Price Friends		41.9		47.4		–12	%
Other Fisher-Price		1.0		1.6		–39	%
		153.8		163.8		–6	%
Construction and Arts & Crafts Brands		18.5		—		100	%
Other		0.5		1.9
Total Gross Sales	$	569.9	$	627.9		–9	%

Gross sales for the International segment were $569.9 million in the second quarter of 2014, down $58.0 million or 9%, as compared to $627.9 million in the second quarter of 2013, with an unfavorable impact from changes in currency exchange rates of 2 percentage points. The decrease in the International segment gross sales was primarily due to lower sales of Entertainment, Barbie, Other Girls, and Fisher-Price Friends products, partially offset by Construction and Arts & Crafts products. Of the 23% decrease in Entertainment gross sales, 10% was due to lower sales of Superman products, 6% was due to lower sales of kids games, and 3% was due to lower sales of CARS products. The 15% decrease in Barbie gross sales was due to lower consumer takeaway, and higher retail inventory levels from prior year in certain international markets. Of the 14% decrease in Other Girls gross sales, 29% was due to lower sales of Monster High products, partially offset by higher sales of Disney Princess products of 11%. Of the 12% decline in Fisher-Price Friends gross sales, 4% was due to lower sales of Disney Jake and the Never Land Pirates products and 3% was due to lower sales of Octonauts^® products. The increase in Construction and Arts & Crafts gross sales was due to initial sales of MEGA Brands products. Cost of sales increased 1% in the second quarter of 2014, compared to a 10% decrease in net sales, primarily due to higher product and other costs, partially offset by lower royalty expense. Gross margins decreased as a result of higher input costs partially offset by price increases, the impact of lower sales volume on Mattel’s fixed cost manufacturing and distribution base, unfavorable product mix, and the impact of the MEGA Brands acquisition, including the impact of the inventory fair value markup above historical cost.

International segment income decreased 60% to $30.9 million in the second quarter of 2014, as compared to $77.1 million in the second quarter of 2013, primarily due to lower gross profit, partially offset by lower advertising and promotion expenses.

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American Girl Segment

The following table provides a summary of Mattel’s gross sales by brand for the American Girl segment for the second quarter of 2014 and 2013:

	For the Three Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
American Girl Segment:
American Girl Brands	$	83.1	$	78.2		6	%
Other Brands		4.6		5.6		–18	%
Total American Girl Segment	$	87.7	$	83.8		5	%

Gross sales for the American Girl segment were $87.7 million in the second quarter of 2014, up $3.9 million or 5%, as compared to $83.8 million in the second quarter of 2013, with no impact from changes in currency exchange rates. Of the 6% increase in American Girl Brands gross sales, 4% was due to higher sales of the 2014 Girl of the Year, Isabelle™. Cost of sales increased 8% in the second quarter of 2014, as compared to a 6% increase in net sales, primarily due to higher product and other costs. Gross margins decreased as a result of higher input costs partially offset by price increases and unfavorable product mix.

American Girl segment loss decreased by 74% to $1.3 million in the second quarter of 2014, as compared to $4.8 million in the second quarter of 2013, primarily due to higher gross profit and lower advertising and promotion expenses.

Results of Operations—First Half of 2014

Consolidated Results

Net sales for the first half of 2014 were $2.01 billion, a 7% decrease, as compared to $2.16 billion in the first half of 2013, with an unfavorable impact from changes in currency exchange rates of 1 percentage point. Net income for the first half of 2014 was $17.1 million, or $0.05 per diluted share, as compared to net income of $111.9 million, or $0.32 per diluted share, in the first half of 2013. Net income for the first half of 2014 was negatively impacted by lower sales volume, lower gross margin, and higher other selling and administrative expenses, partially offset by a net discrete tax benefit and lower advertising and promotion expenses.

The following table provides a summary of Mattel’s consolidated results for the first half of 2014 and 2013 (in millions, except percentage and basis point information):

	For the Six Months Ended June 30,												Year/Year Change
	2014						2013
	Amount			% of Net Sales			Amount			% of Net Sales			%			Basis Points of Net Sales
Net sales	$	2,008.4			100.0	%	$	2,164.7			100.0	%		–7	%		—
Gross profit	$	974.1			48.5	%	$	1,140.1			52.7	%		–15	%		–420
Advertising and promotion expenses		190.7			9.5			217.9			10.1			–13	%		–60
Other selling and administrative expenses		776.2			38.6			761.6			35.2			2	%		340
Operating income		7.2			0.4			160.6			7.4			–96	%		–700
Interest expense		36.2			1.8			38.6			1.8			–6	%		—
Interest (income)		(3.5	)		–0.2			(2.7	)		–0.1			29	%		–10
Other non-operating (income) expense, net		(1.7	)					1.8
(Loss) income before income taxes	$	(23.8	)		–1.2	%	$	122.9			5.7	%		–119	%		–690

Sales

Net sales for the first half of 2014 were $2.01 billion, a 7% decrease, as compared to $2.16 billion in the first half of 2013, with an unfavorable impact from changes in currency exchange rates of 1 percentage point.

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The following table provides a summary of Mattel’s consolidated gross sales by brand results for the first half of 2014 and 2013:

	For the Six Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
Mattel Girls & Boys Brands:
Barbie	$	330.7	$	387.3		–15	%
Other Girls		423.9		443.6		–4	%
Wheels		270.4		278.3		–3	%
Entertainment		320.8		375.4		–15	%
		1,345.8		1,484.6		–9	%
Fisher-Price Brands:
Core Fisher-Price		399.9		451.3		–11	%
Fisher-Price Friends		166.3		200.8		–17	%
Other Fisher-Price		34.0		31.9		7	%
		600.2		684.0		–12	%
American Girl Brands		189.1		178.6		6	%
Construction and Arts & Crafts Brands		61.6		—		100	%
Other		15.7		19.4
Total Gross Sales	$	2,212.4	$	2,366.6		–7	%

Gross sales for Mattel were $2.21 billion in the first half of 2014, down $154.2 million or 7%, as compared to $2.37 billion in the first half of 2013, with an unfavorable impact from changes in currency exchange rates of 1 percentage point. The decrease in gross sales was due to lower sales of Fisher-Price Friends, Barbie, Entertainment, and Core Fisher-Price products, partially offset by Construction and Arts & Crafts products. Of the 17% decrease in Fisher-Price Friends gross sales, 4% was due to lower sales of Disney Jake and the Never Land Pirates products, 4% was due to lower sales of Thomas & Friends products, and 4% was due to lower sales of Nickelodeon products. The 15% decrease in Barbie gross sales was due to lower consumer takeaway, and higher retail inventory levels from prior year in certain international markets. Of the 15% decrease in Entertainment gross sales, 9% was due to lower sales of Superman products and 5% was due to lower sales of CARS products. Of the 11% decrease in Core Fisher-Price gross sales, 4% was due to lower sales of Little People products and 3% was due to lower sales of Imaginext products. The increase in Construction and Arts & Crafts gross sales was due to initial sales of MEGA Brands products.

Cost of Sales

Cost of sales as a percentage of net sales was 51.5% in the first half of 2014, as compared to 47.3% in the first half of 2013. Cost of sales increased by $9.7 million, or 1%, from $1.02 billion in the first half of 2013 to $1.03 billion in the first half of 2014, as compared to a 7% decrease in net sales. Within cost of sales, product and other costs increased by $16.7 million, or 2%, from $815.3 million in the first half of 2013 to $832.0 million in the first half of 2014; freight and logistics expenses increased by $0.3 million from $125.2 million in the first half of 2013 to $125.5 million in the first half of 2014; and royalty expenses decreased by $7.3 million, or 9%, from $84.2 million in the first half of 2013 to $76.9 million in the first half of 2014.

Gross Profit

Gross profit as a percentage of net sales decreased from 52.7% in the first half of 2013 to 48.5% in the first half of 2014. The decrease in gross profit as a percentage of net sales was primarily due to the impact of the MEGA Brands acquisition, including the impact of the inventory fair value markup above historical cost, efforts to reduce inventory levels, including higher close-out sales, the impact of lower sales volume on Mattel’s fixed cost manufacturing and distribution base, unfavorable product mix, and higher input costs partially offset by price increases and Operational Excellence 3.0 savings.

Advertising and Promotion Expenses

Advertising and promotion expenses primarily consist of: (i) media costs, which primarily include the media, planning, and buying fees for television, print, and online advertisements, (ii) non-media costs, which primarily include commercial and website production, merchandising, and promotional costs, (iii) retail advertising costs, which primarily include consumer direct catalogs, newspaper inserts, fliers, and mailers and (iv) generic advertising costs, which primarily include trade show costs. Advertising and promotion expenses as a percentage of net sales decreased from 10.1% in the first half of 2013 to 9.5% in the first half of 2014, primarily due to efforts to improve the effectiveness of advertising and a shift in the timing of advertising to later in the year.

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Other Selling and Administrative Expenses

Other selling and administrative expenses were $776.2 million, or 38.6% of net sales, in the first half of 2014, as compared to $761.6 million, or 35.2% of net sales, in the first half of 2013. The increase in other selling and administrative expenses was due to approximately $21 million of incremental severance and other termination-related costs and approximately $16 million of transaction, integration, and amortization costs associated with the MEGA Brands acquisition, partially offset by the absence of a 2013 asset impairment charge of approximately $14 million.

Non-Operating Items

Interest expense decreased from $38.6 million in the first half of 2013 to $36.2 million in the first half of 2014, primarily due to lower average interest rates related to long-term borrowings.

Provision for Income Taxes

Mattel’s benefit for income taxes was $40.9 million in the first half of 2014, as compared to a provision for income taxes of $11.0 million in the first half of 2013. Mattel recognized net discrete tax benefits of $36.4 million and $15.2 million in the first half of 2014 and 2013, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions, settlements, and enacted tax law changes.

North America Segment

The following table provides a summary of Mattel’s gross sales by brand for the North America segment for the first half of 2014 and 2013:

	For the Six Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
Mattel Girls & Boys Brands:
Barbie	$	119.4	$	134.1		–11	%
Other Girls		186.0		190.3		–2	%
Wheels		117.2		124.5		–6	%
Entertainment		156.7		176.3		–11	%
		579.3		625.2		–7	%
Fisher-Price Brands:
Core Fisher-Price		207.1		249.1		–17	%
Fisher-Price Friends		86.8		113.2		–23	%
Other Fisher-Price		32.8		29.7		10	%
		326.7		392.0		–17	%
Construction and Arts & Crafts Brands		43.1		—		100	%
Other		5.8		5.8
Total Gross Sales	$	954.9	$	1,023.0		–7	%

Gross sales for the North America segment were $954.9 million in the first half of 2014, down $68.1 million or 7%, as compared to $1.02 billion in the first half of 2013, with an unfavorable impact from changes in currency exchange rates of 1 percentage point. The decrease in the North America segment gross sales was primarily due to lower sales of Fisher-Price Friends, Core Fisher-Price, Entertainment, and Barbie products, partially offset by Construction and Arts & Crafts products. Of the 23% decrease in Fisher-Price Friends gross sales, 8% was due to lower sales of Thomas & Friends products, 5% was due to lower sales of Nickelodeon products, and 4% was due to lower sales of Disney Jake and the Never Land Pirates products. Of the 17% decrease in Core Fisher-Price gross sales, 6% was due to lower sales of Little People products and 5% was due to lower sales of Imaginext products. Of the 11% decrease in Entertainment gross sales, 12% was due to lower sales of Superman products. The 11% decrease in Barbie gross sales was due to lower consumer takeaway. The increase in Construction and Arts & Crafts gross sales was due to initial sales of MEGA Brands products. Cost of sales increased 3% in the first half of 2014, as compared to an 8% decrease in net sales, due to higher product and other costs, partially offset by lower royalty expense. Gross margins decreased as a result of the impact of the MEGA Brands acquisition, including the impact of the inventory fair value markup above historical cost, the impact of lower sales volume on Mattel’s fixed cost manufacturing and distribution base, and unfavorable product mix.

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North America segment income decreased 42% to $88.2 million in the first half of 2014, as compared to $152.1 million in the first half of 2013, primarily due to lower gross profit, partially offset by lower advertising and promotion expenses and lower other selling and administrative expenses.

International Segment

The following table provides a summary of percentage changes in gross sales within the International segment in the first half of 2014 versus 2013:

	% Change in Gross Sales		Impact of Change in Currency Rates (in % pts)
Total International Segment		–8		–1
Europe		–4		1
Latin America		–14		–6
Asia Pacific		–11		–2

The following table provides a summary of Mattel’s gross sales by brand for the International segment for the first half of 2014 and 2013:

	For the Six Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
Mattel Girls & Boys Brands:
Barbie	$	211.3	$	253.2		–17	%
Other Girls		237.8		253.3		–6	%
Wheels		153.3		153.8		—
Entertainment		164.1		199.1		–18	%
		766.5		859.4		–11	%
Fisher-Price Brands:
Core Fisher-Price		192.8		202.2		–5	%
Fisher-Price Friends		79.4		87.6		–9	%
Other Fisher-Price		1.3		2.2		–44	%
		273.5		292.0		–6	%
Construction and Arts & Crafts Brands		18.5		—		100	%
Other		0.7		3.5
Total Gross Sales	$	1,059.2	$	1,154.9		–8	%

Gross sales for the International segment were $1.06 billion in the first half of 2014, down $95.7 million or 8%, as compared to $1.15 billion in the first half of 2013, with an unfavorable change in currency exchange rates of 1 percentage point. The decrease in the International segment gross sales was primarily due to lower sales of Entertainment and Barbie products, partially offset by Construction and Arts & Crafts products. Of the 18% decrease in Entertainment gross sales, 6% was due to lower sales of Superman products, 6% was due to lower sales of CARS products, and 6% was due to lower sales of kids games. The 17% decrease in Barbie gross sales was due to lower consumer takeaway, and higher retail inventory levels from prior year in certain international markets. The increase in Construction and Arts & Crafts gross sales was due to initial sales of MEGA Brands products. Cost of sales decreased 1% in the first half of 2014, as compared to a 9% decrease in net sales, primarily due to lower royalty expense. Gross margins decreased as a result of the impact of lower sales volume on Mattel’s fixed cost manufacturing and distribution base, the impact of the MEGA Brands acquisition, including the impact of the inventory fair value markup above historical cost, efforts to reduce inventory levels, including higher close-out sales, and higher input costs partially offset by price increases and Operational Excellence 3.0 savings.

International segment income decreased by 55% to $62.3 million in the first half of 2014, as compared to $139.1 million in the first half of 2013, driven primarily by lower gross profit, partially offset by lower advertising and promotion expenses.

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American Girl Segment

The following table provides a summary of Mattel’s gross sales by brand for the American Girl segment for the first half of 2014 and 2013:

	For the Six Months Ended June 30,
	2014		2013		% Change
	(In millions, except percentage information)
American Girl Segment:
American Girl Brands	$	189.1	$	178.6		6	%
Other Brands		9.2		10.1		–9	%
Total American Girl Segment	$	198.3	$	188.7		5	%

Gross sales for the American Girl segment were $198.3 million in the first half of 2014, up $9.6 million or 5%, as compared to $188.7 million in the first half of 2013, with no impact from changes in currency exchange rates. Of the 6% increase in American Girl Brands gross sales, 5% was due to higher sales of the 2014 Girl of the Year, Isabelle. Cost of sales increased 8% in the first half of 2014, as compared to a 5% increase in net sales, primarily due to higher product and other costs and higher freight and logistics expenses. Gross margins decreased as a result of unfavorable product mix.

American Girl segment income increased by 11% to $8.0 million in the first half of 2014, as compared to $7.2 million in the first half of 2013, primarily due to higher gross profit, partially offset by higher other selling and administrative expenses and higher advertising and promotion expenses.

Operational Excellence 3.0

Beginning in 2013, Mattel initiated the third phase of its cost savings program, Operational Excellence 3.0, which targets cumulative gross cost savings of approximately $175 million by the end of 2014. The cost savings program is designed to generate sustainable cost savings through the following primary initiatives:

• Manufacturing efficiencies through automation, Lean manufacturing principles, design for manufacturing, enterprise quality, and packaging optimization,

• Indirect procurement,

• Operational efficiencies related to enhanced International clustering and realignment of North America operations, and

• A reduction in Mattel’s professional workforce to drive efficiencies throughout the organization and align its infrastructure with realistic revenue assumptions, which resulted in severance and other termination-related costs of approximately $34 million in the first half of 2014.

For the second quarter of 2014, Mattel realized gross cost savings, excluding severance charges and investments, of approximately $25 million (or approximately $13 million of net savings including severance charges and investments). Of the gross cost savings realized in the second quarter of 2014, approximately $14 million was reflected within gross profit and approximately $11 million within other selling and administrative expenses.

For the first half of 2014, Mattel realized gross cost savings, excluding severance charges and investments, of approximately $41 million (or approximately $5 million of net savings including severance charges and investments). Of the gross cost savings realized in the first half of 2014, approximately $26 million was reflected within gross profit, approximately $14 million within other selling and administrative expenses, and approximately $1 million within advertising and promotion expenses.

From the commencement of Operational Excellence 3.0 through June 30, 2014, Mattel has realized approximately $101 million of cumulative gross cost savings. Mattel continues to be on track to realize approximately $175 million in sustainable cumulative gross savings by the end of 2014.

Income Taxes

Mattel’s benefit for income taxes was $40.9 million in the first half of 2014, as compared to a provision for income taxes of $11.0 million for the first half of 2013. Mattel recognized net discrete tax benefits of $40.1 million and $36.4 million in the second quarter and first half of 2014, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions, settlements, and enacted tax law changes. Mattel recognized net discrete tax benefits of $11.2 million and $15.2 million in the second quarter and first half of 2013, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions, settlements, and enacted tax law changes.

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In the normal course of business, Mattel is regularly audited by federal, state, and foreign tax authorities. In May 2014, the IRS completed its audit of Mattel’s 2010 and 2011 federal income tax returns. Additionally, the statutes of limitations lapsed with respect to other domestic and foreign jurisdictions. As a result of these events, Mattel recognized net discrete tax benefits of $40.1 million in the second quarter of 2014.

Based on the current status of federal, state, and foreign audits, Mattel believes it is reasonably possible that in the next twelve months, the total unrecognized tax benefits could decrease by approximately $38 million related to the settlement of tax audits and/or the expiration of statutes of limitations. The ultimate settlement of any particular issue with the applicable taxing authority could have a material impact on Mattel’s consolidated financial statements.

Liquidity and Capital Resources

Mattel’s primary sources of liquidity are its cash and equivalents balances, access to short-term borrowing facilities, including its $1.60 billion domestic unsecured committed revolving credit facility (“Credit Facility”), and issuances of long-term debt securities. Cash flows from operating activities could be negatively impacted by decreased demand for Mattel’s products, which could result from factors such as adverse economic conditions and changes in public and consumer preferences, or by increased costs associated with manufacturing and distribution of products or shortages in raw materials or component parts. Additionally, Mattel’s ability to issue long-term debt and obtain seasonal financing could be adversely affected by factors such as global economic crises and tight credit environments, an inability to meet its debt covenant requirements, which include maintaining consolidated debt-to-earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and interest coverage ratios, or a deterioration of Mattel’s credit ratings. Mattel’s ability to conduct its operations could be negatively impacted should these or other adverse conditions affect its primary sources of liquidity.

Of Mattel’s $518.2 million in cash and equivalents as of June 30, 2014, approximately $449 million is held by foreign subsidiaries. Mattel may need to accrue and pay additional income taxes if some or all of the undistributed earnings of foreign subsidiaries were repatriated. Mattel does not intend nor foresee a need to repatriate undistributed earnings of foreign subsidiaries. Mattel has several liquidity options to fund its domestic operations and obligations, including investing and financing activities such as dividends, share repurchases, and debt service. Positive cash flows generated annually by its domestic operations, the unused Credit Facility of $1.60 billion as of June 30, 2014, and access to both long-term and short-term public and private debt markets at highly competitive interest rates are available to fund domestic operations and obligations. If these sources are not adequate, Mattel also has the ability to repatriate highly taxed foreign earnings, receive repayment of intercompany loans to foreign subsidiaries, and distribute liquidating dividends from foreign subsidiaries, all of which would have a very nominal impact, if any, on Mattel’s tax liabilities. Mattel believes that its policy to indefinitely reinvest the earnings of its foreign subsidiaries will not result in and is not reasonably likely to result in a material change to Mattel’s liquidity position.

Current Market Conditions

Mattel is exposed to financial market risk resulting from changes in interest and foreign currency rates. Mattel believes that it has ample liquidity to fund its business needs, including beginning of year cash and equivalents, cash flows from operations, and access to the commercial paper markets and its Credit Facility, which it uses for seasonal working capital requirements. As of June 30, 2014, Mattel had available incremental borrowing resources totaling $1.60 billion under the Credit Facility, and Mattel has not experienced any limitations on its ability to access this source of liquidity. Market conditions could affect certain terms of other debt instruments that Mattel enters into from time to time.

Mattel monitors the third-party depository institutions that hold the Company’s cash and equivalents. Mattel’s emphasis is primarily on safety and liquidity of principal, and secondarily on maximizing the yield on those funds. Mattel diversifies its cash and equivalents among counterparties and securities to minimize risks.

Mattel is subject to credit risks relating to the ability of its counterparties in hedging transactions to meet their contractual payment obligations. The risks related to creditworthiness and nonperformance have been considered in the fair value measurements of Mattel’s foreign currency forward exchange contracts. Mattel closely monitors its counterparties and takes action, as necessary, to manage its counterparty credit risk.

Mattel expects that some of its customers and vendors may experience difficulty in obtaining the liquidity required to buy inventory or raw materials. Mattel monitors its customers’ financial condition and their liquidity in order to mitigate Mattel’s accounts receivable collectibility risks, and customer terms and credit limits are adjusted, if necessary. Additionally, Mattel uses a variety of financial arrangements to ensure collectibility of accounts receivable of customers deemed to be a credit risk, including requiring letters of credit, factoring, purchasing various forms of credit insurance with unrelated third parties, or requiring cash in advance of shipment.

Mattel sponsors defined benefit pension plans and postretirement benefit plans for its employees. Actual returns below the expected rate of return, along with changes in interest rates that affect the measurement of the liability, would impact the amount and timing of Mattel’s future contributions to these plans.

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Capital and Investment Framework

To guide future capital deployment decisions, with a goal of maximizing stockholder value, Mattel’s Board of Directors established the following capital and investment framework:

• To maintain approximately $800 million to $1 billion in year-end cash available to fund a substantial portion of seasonal working capital,

• To maintain a year-end debt-to-capital ratio of about 35%,

• To invest approximately $180 million to $200 million in capital expenditures annually to maintain and grow the business,

• To make strategic opportunistic acquisitions, and

• To return excess funds to stockholders through dividends and share repurchases.

Over the long term, assuming cash flows from operating activities remain strong, Mattel plans to use its free cash flows to invest in strategic acquisitions and to return funds to stockholders through cash dividends and share repurchases. Mattel’s share repurchase program has no expiration date and repurchases will take place from time to time, depending on market conditions. The ability to successfully implement the capital deployment plan is directly dependent on Mattel’s ability to generate strong cash flows from operating activities. There is no assurance that Mattel will continue to generate strong cash flows from operating activities or achieve its targeted goals for investing activities.

Operating Activities

Cash flows used for operating activities were $79.2 million in the first half of 2014, as compared to $285.9 million in the first half of 2013. The decrease in cash flows used for operating activities was primarily due to lower working capital usage.

Investing Activities

Cash flows used for investing activities were $524.7 million in the first half of 2014, as compared to $132.5 million in the first half of 2013. The increase in cash flows used for investing activities was primarily due to the acquisition of MEGA Brands.

Financing Activities

Cash flows provided by financing activities were $83.1 million in the first half of 2014, as compared to cash flows used for financing activities of $84.3 million in the first half of 2013. The change in cash flows provided by financing activities was primarily due to lower repayments of long-term borrowings, partially offset by lower proceeds from the exercise of stock options.

Seasonal Financing

Mattel maintains and periodically amends or replaces its domestic unsecured committed revolving credit facility with a commercial bank group. The facility is used as a back-up to Mattel’s commercial paper program, which is used as the primary source of financing for the seasonal working capital requirements of its domestic subsidiaries. The agreement governing the credit facility was amended and restated on March 11, 2013 to, among other things, (i) extend the maturity date of the credit facility to March 12, 2018, (ii) increase aggregate commitments under the credit facility to $1.60 billion, with an “accordion feature,” which allows Mattel to increase the aggregate availability under the credit facility to $1.85 billion under certain circumstances, (iii) decrease the applicable interest rate margins to a range of 0.00% to 0.75% above the applicable base rate for base rate loans and 0.88% to 1.75% above the applicable LIBOR for Eurodollar rate loans, in each case depending on Mattel’s senior unsecured long-term debt rating, and (iv) decrease commitment fees to a range of 0.08% to 0.28% of the unused commitments under the credit facility.

Mattel is required to meet financial ratio covenants at the end of each quarter and fiscal year, using the formulae specified in the credit agreement to calculate the ratios. Mattel was in compliance with such covenants at the end of the six months ended June 30, 2014. As of June 30, 2014, Mattel’s consolidated debt-to-EBITDA ratio, as calculated per the terms of the credit agreement, was 1.71 to 1 (compared to a maximum allowed of 3.00 to 1), and Mattel’s interest coverage ratio was 16.30 to 1 (compared to a minimum required of 3.50 to 1).

The credit agreement is a material agreement, and failure to comply with the financial ratio covenants may result in an event of default under the terms of the credit facility. If Mattel were to default under the terms of the credit facility, its ability to meet its seasonal financing requirements could be adversely affected.

To finance seasonal working capital requirements of certain foreign subsidiaries, Mattel avails itself of individual short-term credit lines with a number of banks. Mattel expects to extend the majority of these credit lines throughout 2014.

Mattel believes its cash on hand, amounts available under its credit facility, and its foreign credit lines will be adequate to meet its seasonal financing requirements in 2014.

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Financial Position

Mattel’s cash and equivalents decreased $521.0 million to $518.2 million at June 30, 2014, as compared to $1.04 billion at December 31, 2013. The decrease was primarily due to the acquisition of MEGA Brands, dividend payments, share repurchases, and purchases of tools, dies, and molds and other property, plant, and equipment, partially offset by net proceeds from the issuance of the 2014 Senior Notes.

Accounts receivable decreased $381.2 million to $878.9 million at June 30, 2014, as compared to $1.26 billion at December 31, 2013. Inventory increased $316.6 million to $885.4 million at June 30, 2014, as compared to $568.8 million at December 31, 2013. Accounts receivable and inventory increased $53.5 million and $87.3 million, respectively, from December 31, 2013 due to the MEGA Brands acquisition. The decrease in accounts receivable and remaining increase in inventory were due to the seasonality of Mattel’s business.

Accounts payable and accrued liabilities decreased $148.0 million to $867.5 million at June 30, 2014, as compared to $1.02 billion at December 31, 2013. The decrease was primarily due to the timing and amount of payments for various liabilities, including incentive compensation, royalties, and advertising and promotion, partially offset by accounts payable and accrued liabilities assumed as part of the MEGA Brands acquisition.

As of June 30, 2014, Mattel had foreign short-term bank loans outstanding of $20.5 million, an increase of $16.2 million from December 31, 2013. Noncurrent long-term debt increased $500.0 million to $2.10 billion as of June 30, 2014, compared to $1.60 billion as of December 31, 2013, due to the $500.0 million issuance of 2014 Senior Notes.

A summary of Mattel’s capitalization is as follows:

	June 30, 2014				June 30, 2013				December 31, 2013
	(In millions, except percentage information)
2010 Senior Notes	$	500.0	9	%	$	500.0	10	%	$	500.0	9	%
2011 Senior Notes		600.0	11			600.0	11			600.0	12
2013 Senior Notes		500.0	9			500.0	10			500.0	9
2014 Senior Notes		500.0	9			—	—			—	—
Total noncurrent long-term debt		2,100.0	38			1,600.0	31			1,600.0	30
Other noncurrent liabilities		518.3	9			636.6	12			540.6	10
Stockholders’ equity		2,951.6	53			2,921.4	57			3,251.6	60
	$	5,569.9	100	%	$	5,158.0	100	%	$	5,392.2	100	%

Mattel’s debt-to-total capital ratio, including short-term borrowings and the current portion of long-term debt, increased from 36.7% at June 30, 2013 to 41.8% at June 30, 2014 as a result of higher borrowings. Mattel’s objective is to maintain a year-end debt-to-capital ratio of about 35%.

Litigation

See Item 1“Financial Statements—Note 20 to the Consolidated Financial Statements—Contingencies” of this Quarterly Report on Form 10-Q.

Application of Critical Accounting Policies and Estimates

Mattel’s critical accounting policies and estimates are included in its Annual Report on Form 10-K for the year ended December 31, 2013 and did not change during the first half of 2014.

New Accounting Pronouncements

See Item 1 “Financial Statements—Note 22 to the Consolidated Financial Statements—New Accounting Pronouncements.”

Non-GAAP Financial Measure

In this Quarterly Report on Form 10-Q, 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, brand, and geographic results to highlight significant trends in Mattel’s business. Changes in gross sales are discussed because,

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while Mattel records the detail of such sales adjustments in its financial accounting systems at the time of sale, such sales adjustments are generally not associated with individual products, making net sales less meaningful. A reconciliation of gross sales to the most directly comparable GAAP financial measure, net sales, is as follows:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Revenues by Segment
North America	$	513,463		$	566,471		$	954,894		$	1,022,940
International		569,936			627,896			1,059,175			1,154,907
American Girl		87,731			83,757			198,289			188,707
Gross sales		1,171,130			1,278,124			2,212,358			2,366,554
Sales adjustments		(108,878	)		(109,015	)		(203,929	)		(201,839	)
Net sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Foreign Currency Exchange Rate Risk

Currency exchange rate fluctuations may impact Mattel’s results of operations and cash flows. Inventory purchase and sale transactions denominated in the Euro, British pound sterling, Mexican peso, Brazilian real, and Indonesian rupiah are the primary transactions that caused foreign currency transaction exposure for Mattel. Mattel seeks to mitigate its exposure to market risk by monitoring its foreign currency transaction exposure for the year and partially hedging such exposure, using foreign currency forward exchange contracts primarily to hedge its purchase and sale of inventory and other intercompany transactions denominated in foreign currencies. These contracts generally have maturity dates of up to 18 months. For those intercompany receivables and payables that are not hedged, the transaction gains or losses are recorded in the consolidated statement of operations in the period in which the exchange rate changes as part of operating income or other non-operating (income) expense, net based on the nature of the underlying transaction. Transaction gains or losses on hedged intercompany inventory transactions are recorded in the consolidated statement of operations in the period in which the inventory is sold to customers. In addition, Mattel manages its exposure to currency exchange rate fluctuations through the selection of currencies used for international borrowings. Mattel does not trade in financial instruments for speculative purposes.

Mattel’s financial position is also impacted by currency exchange rate fluctuations on translation of its net investments in subsidiaries with non-US dollar functional currencies. Assets and liabilities of subsidiaries with non-US dollar functional currencies are translated into US dollars at fiscal period-end exchange rates. Income, expense, and cash flow items are translated at weighted average exchange rates prevailing during the fiscal year. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive loss within stockholders’ equity. Mattel’s primary currency translation exposures during the first half of 2014 were related to its net investments in entities having functional currencies denominated in the British pound sterling, Brazilian real, Australian dollar, and Euro.

There are numerous factors impacting the amount by which Mattel’s financial results are affected by foreign currency translation and transaction gains and losses resulting from changes in currency exchange rates, including, but not limited to, the level of foreign currency forward exchange contracts in place at a given time and the volume of foreign currency denominated transactions in a given period. However, assuming that such factors were held constant, Mattel estimates that a 1 percent change in the US dollar Trade-Weighted Index would impact Mattel’s net sales by approximately 0.5% and its full year earnings per share by approximately $0.01 to $0.02.

Venezuelan Operations

Since January 1, 2010, Mattel has accounted for Venezuela as a highly inflationary economy as the three-year cumulative inflation rate for Venezuela exceeded 100%. Accordingly, Mattel’s Venezuelan subsidiary uses the US dollar as its functional currency, and monetary assets and liabilities denominated in Venezuelan bolivar fuerte (“BsF”) generate income or expense for changes in value associated with foreign currency exchange rate fluctuations against the US dollar. From January 2010 through January 2013, Mattel’s Venezuelan subsidiary used the Sistema de Transacciones con Titulos en Moneda Extranjera (“SITME”) rate, which was controlled by the Central Bank of Venezuela, to remeasure monetary assets and liabilities denominated in BsF. The SITME rate was quoted at 5.30 BsF per US dollar as of December 31, 2012.

During February 2013, the Central Bank of Venezuela revised its official exchange rate to 6.30 BsF per US dollar and eliminated the SITME rate. Since February 2013, Mattel’s Venezuelan subsidiary has used the official exchange rate as its remeasurement rate. The change in the exchange rate resulted in an unrealized foreign currency exchange loss of approximately $5 million, which was primarily recognized within other non-operating (income) expense, net in the consolidated statements of operations in the first quarter of 2013.

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During March 2013, the Venezuelan government announced a complementary currency exchange system, the Sistema Complementario de Administracion de Divisas 1 (“SICAD 1”). Participation in SICAD 1 is controlled by the Venezuelan government. SICAD 1 is intended to function as an auction system, allowing entities in specific sectors to bid for US dollars to be used for specified import transactions. During December 2013, the government regulation that created SICAD 1 was amended to expand its use and to require publication of the average exchange rate implied by transactions settled in SICAD 1 auctions. In January 2014, the Venezuelan government announced a new foreign currency administration body, the National Center for Foreign Commerce (“CENCOEX”), which approves certain transactions at the official rate.

During February 2014, the Venezuelan government created a third currency exchange system called the Sistema Complementario de Administracion de Divisas 2 (“SICAD 2”), which is expected to provide a greater supply of US dollars from sources other than the Venezuelan government, is expected to allow all sectors and companies to participate, and is expected to permit US dollars to be offered in cash or bonds. Foreign exchange transactions in SICAD 2 will be regulated by the Central Bank of Venezuela and administered by registered banks, brokerage firms, and exchange houses that have been authorized by the Central Bank of Venezuela.

Mattel has not accessed US dollars in Venezuela through SICAD 1 and does not expect to be able to access the SICAD 1 rate in the foreseeable future. Mattel is currently monitoring and assessing the currency exchange rates and restrictions associated with SICAD 1. Based on a number of factors, including the restrictions placed on eligible participants, the amount of US dollars available to purchase through the auction process, and the ineligibility of past import transactions to be settled through SICAD 1, Mattel does not currently believe it is appropriate to use the SICAD 1 rate as its remeasurement rate. However, had Mattel used the SICAD 1 rate of 10.60 BsF per US dollar as of June 30, 2014 as its remeasurement rate, it would have recognized a pre-tax charge of approximately $9 million in its consolidated statement of operations.

Since SICAD 2 began operations on March 24, 2014, Mattel has not been able to access US dollars in Venezuela through SICAD 2. Mattel is currently monitoring the restrictions associated with SICAD 2 and, as Mattel has been unable to access the SICAD 2 system, it does not currently believe it is appropriate to use the SICAD 2 rate as its remeasurement rate. However, had Mattel used the SICAD 2 rate of 49.98 BsF per US dollar as of June 30, 2014 as its remeasurement rate, it would have resulted in a pre-tax charge of approximately $19 million in its consolidated statement of operations.

Mattel’s Venezuelan subsidiary represented less than 0.1% of Mattel’s consolidated net sales in the first half of 2014 and had approximately $22 million of net monetary assets denominated in BsF as of June 30, 2014. Venezuela currency matters, along with economic and political instability, continue to impact the operating results of Mattel’s Venezuelan subsidiary. If the economic or political conditions significantly worsen, Mattel may consider ceasing operations of its Venezuelan subsidiary, which could result in a pre-tax charge to its consolidated statement of operations of up to $95 million.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

As of June 30, 2014, Mattel’s disclosure controls and procedures were evaluated, with the participation of Mattel’s principal executive officer and principal financial officer, to assess whether they are effective in providing reasonable assurance that information required to be disclosed by Mattel in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and to provide reasonable assurance that such information is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms. The scope of Mattel’s assessment of the effectiveness of its disclosure controls and procedures does not include any disclosure controls and procedures of MEGA Brands, which was acquired on April 30, 2014, that are also part of MEGA Brands’ internal control over financial reporting. This exclusion is in accordance with the SEC’s general guidance that a recently acquired business may be omitted from the scope of the assessment in the year of acquisition. Based on this evaluation, Bryan G. Stockton, Mattel’s principal executive officer, and Kevin M. Farr, Mattel’s principal financial officer, concluded that these disclosure controls and procedures were effective as of June 30, 2014.

Changes in Internal Control Over Financial Reporting

During the quarter ended June 30, 2014, Mattel made no changes to its internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

The content of Part I, Item 1 “Financial Statements—Note 20 to the Consolidated Financial Statements—Contingencies” of this Quarterly Report on Form 10-Q is hereby incorporated by reference in its entirety in this Item 1.

Item 1A. Risk Factors.

There have been no material changes to the risk factors disclosed under Part I, Item 1A “Risk Factors” in Mattel’s 2013 Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Recent Sales of Unregistered Equity Securities

During the second quarter of 2014, Mattel did not sell any unregistered equity securities.

Issuer Purchases of Equity Securities

This table provides certain information with respect to Mattel’s purchases of its common stock during the second quarter of 2014:

Period	Total Number of Shares (or Units) Purchased (1)		Average Price Paid per Share (or Unit)		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (2)
April 1—30		1,285,408	$	38.02		1,275,528	$	304,012,944
May 1—31		1,030,727		39.30		1,017,898		264,013,139
June 1—30		319,280		38.79		309,380		252,013,155
Total		2,635,415	$	38.61		2,602,806	$	252,013,155

(1) The total number of shares purchased includes 32,609 shares withheld from employees to satisfy minimum tax withholding obligations that occur upon vesting of restricted stock units. These shares were not purchased as part of a publicly announced repurchase plan or program.

(2) Mattel’s share repurchase program was first announced on July 21, 2003. Repurchases under the program will take place from time to time, depending on market conditions. Mattel’s share repurchase program has no expiration date.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

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Item 6. Exhibits.

		Incorporated by Reference
Exhibit No.	Exhibit Description	Form	File No.	Exhibit(s)	Filing Date
3.0	Restated Certificate of Incorporation of Mattel, Inc.	8-K	001-05647	99.0	May 21, 2007
3.1	Amended and Restated By-laws of Mattel, Inc.	10-Q	001-05647	3.1	July 20, 2011
4.0	Specimen Stock Certificate with respect to Mattel’s Common Stock	10-Q	001-05647	4.0	August 3, 2007
4.1	Form of 2.350% Notes due 2019	8-K	001-05647	4.1	May 6, 2014
10.1*+	Letter Agreement among Mattel, MEGA Brands Inc. (MEGA Brands) and Geoff Massingberd, dated May 5, 2014, regarding an offer of employment for the position of President, MEGA Brands
10.2*+	Letter Agreement between Mattel and Richard Dickson, dated May 19, 2014, regarding an offer of employment for the position of Chief Brands Officer
12.0*	Computation of Earnings to Fixed Charges
31.0*	Certification of Principal Executive Officer dated July 29, 2014 pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.1*	Certification of Principal Financial Officer dated July 29, 2014 pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.0**	Certifications of Principal Executive Officer and Principal Financial Officer dated July 29, 2014 pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

+ Management contract or compensatory plan or arrangement.

* Filed herewith.

** Furnished herewith. This exhibit should not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934.

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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, thereunto duly authorized.

MATTEL, INC. Registrant
By:	/s/ H. Scott Topham
	H. Scott Topham Senior Vice President and Corporate Controller (Duly authorized officer and chief accounting officer)

Date: July 29, 2014

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EX-10.1

EXHIBIT 10.1

Date:	April 30, 2014
To:	Geoff Massingberd

Dear Geoff:

Effective April 15, 2014, you were appointed to serve as President of Mattel-MEGA Holdings Inc., a wholly-owned subsidiary of Mattel, Inc. (“Mattel”). We are now pleased to offer you the position of, and request that you serve as, President of MEGA Brands Inc. (“MEGA Brands”), effective on the closing date of Mattel’s acquisition, through Mattel-MEGA Holdings Inc., of MEGA Brands (the “Closing Date”), reporting directly to the Board of Directors of MEGA Brands and, as the Chairman of the Board of Directors of MEGA Brands, reporting regularly to Bryan Stockton, Chairman and Chief Executive Officer of Mattel, the ultimate parent company of MEGA Brands.

Effective on the Closing Date, you will be employed by MEGA Brands, and you will perform all the usual duties of the position to which you exclusively will devote your full business time, attention and ability. You also will continue to serve as President of Mattel-MEGA Holdings Inc. This letter agreement outlines the terms of your new position, and your signature below will serve as your acceptance of these terms.

Annualized Base Salary: Effective on the Closing Date, your base salary will be paid at the annual rate of US $715,000, with applicable federal and state taxes and other required withholdings to be deducted.

2014 Mattel Incentive Plan (MIP): You will continue to be eligible to participate in the MIP at a target bonus opportunity of 70% of your base salary. If there is a change in your bonus group as a result of your transfer, any MIP award will be pro-rated based upon the Closing Date.

Mattel 2014 – 2016 Long-Term Incentive Program (LTIP): You will continue to be eligible to participate in the LTIP at a target value of US $1,200,000.

Special Restricted Stock Unit (RSU) Award: You will receive a Special RSU award with a value of US $200,000 on the grant date. The grant value of the RSU award will be converted into a number of RSUs by dividing the grant value by Mattel’s closing stock price on the date of grant. The grant date will be the Closing Date.

So long as you remain employed by MEGA Brands or other subsidiary of Mattel, the Special RSU award will generally vest over the three-year period following the date of the grant: 50% on the second anniversary of the grant date, and 50% on the third anniversary. If Mattel pays a cash dividend, you will receive dividend equivalents with respect to the unvested RSUs.

Please note this is a summary of your Special RSU award, and you will be required to sign the equity grant agreements that set forth the terms and conditions that govern your award.

Supplemental Retirement Benefit: You will continue to be provided with an additional retirement benefit equal to 10% of your base salary each year until you reach age 60, in accordance with your prior letter agreement with Mattel dated June 25, 2008 (“Prior Letter Agreement”).

Special Mobility Bonus: You will receive a special mobility bonus in the amount of US $200,000, less applicable federal and taxes and other required withholdings, no later than 30 days following your date of transfer, to assist with your relocation to Canada. With respect to this special mobility bonus, if within two years of your relocation date, you choose to voluntarily terminate your employment with MEGA Brands or you are discharged for “cause” as defined below, you will be required to repay this amount in full within 30 days of your termination date.

Other Relocation Benefits: You will receive customary relocation services in accordance with the Mattel’s Global Assignment Manual, including eligibility to receive tax equalization reimbursements, if any. In addition, effective on the Closing Date, MEGA Brands will pay your actual approved housing costs (rental cost plus utilities such as electricity, gas and water but excluding telephone and cable) for up to three years and provide you with a company car.

Benefits: You will continue to be eligible to participate in various benefits and programs. Specific benefits details and plan limitations are provided in summary plan descriptions, plan documents or program summaries, which govern and are subject to periodic modification and revision.

Stock Ownership Guidelines: You will continue to be subject to the stock ownership guidelines that were established for you, effective as of January 1, 2014, at three times your base salary. You have until December 31, 2018 to attain your targeted level of ownership.

Severance: In accordance with the Prior Letter Agreement, in the event your employment is involuntarily terminated from MEGA Brands for reasons other than for “cause” as defined below, and you do not continue to be an employee of any subsidiary of Mattel after such termination from MEGA Brands, you will be eligible for severance payments equal to two years of base salary. Receipt of the severance payments is contingent upon your signing and not revoking the then current standard form release agreement. These severance payments are inclusive of any notice of termination, pay in lieu of notice of termination, termination pay, separation or severance pay to which you might be entitled

2

under any Canadian, United States, provincial, state or local law (including without limitation the Civil Code of Quebec) (collectively “Applicable Law”). Notwithstanding the foregoing, in the event that you become entitled to or receive any notice of termination, pay in lieu of notice of termination, termination pay, separation or severance pay on account of your employment or termination of employment, including, for example, any payments required to be paid to you under any Applicable Law, your severance shall be reduced by the amount of any such payments paid or payable.

For purposes of severance and the repayment of your special mobility bonus only, and without altering the at-will nature of your employment, “cause” shall mean MEGA Brands’ good faith belief that you: (i) neglected significant duties you were required to perform or violated a material policy, rule or guideline; (ii) engaged in an act of dishonesty, fraud, misrepresentation or other act of moral turpitude; (iii) engaged in an act or omission in the course of your employment which constitutes gross negligence; or (iv) willfully failed to obey a lawful direction of MEGA Brands or its Board of Directors.

You understand and acknowledge that the terms of this letter do not imply employment for a specific period and thus your employment will be at will. This statement is the entirety of your agreement on the subject of the duration of your employment and cannot be modified, other than by a written agreement signed by you and an authorized representative of MEGA Brands. This letter agreement, together with any global assignment letter, constitutes the entire agreement regarding the terms of your new position, and it is the complete, final, and exclusive embodiment of your agreement with regard to this subject matter and supersedes any other promises, warranties, representations or agreements, whether written or oral, including without limitation the Prior Letter Agreement.

We are sincerely pleased to provide you with this letter detailing the terms of your new position and relocation and look forward to a mutually beneficial arrangement.

Also, please note that as an executive of MEGA Brands, you will continue to be considered an Insider for purposes of Mattel’s Insider Trading Policy and are subject to window period restrictions. As a reminder, this means that you are restricted to conducting transactions in Mattel stock ONLY during open window periods. Examples of such transactions include sales of shares underlying a stock option (including sales of shares to generate cash to pay the exercise price) and changes in elections in the Mattel stock fund of Mattel’s 401(k) plan.

Please review the terms contained herein and sign below to indicate your understanding and concurrence. By signing this letter, you also confirm that you have requested and agree that this letter be provided to you in English. En signant la présente lettre, vous

3

reconnaissez que vous avez exigé que la présente lettre soit rédigée en anglais et que vous en êtes satisfait. Also note that I have enclosed two copies of the letter so that you can return a signed copy to me and retain one for your records. If I can answer any questions, please do not hesitate to contact me.

Sincerely,	Acknowledged
/s/ Alan Kaye	/s/ Geoff Massingberd
Alan Kaye	Geoff Massingberd
	Date 5/5/2014
EVP & Chief Human Resources Officer
Mattel, Inc.
/s/ Gregg Stefanick
Gregg Stefanick
SVP Global Finance & Supply Chain
Mega Brands Inc.

4

EX-10.2

EXHIBIT 10.2

May 16, 2014

Richard Dickson

[Personal Address Omitted]

Dear Richard,

It is our pleasure to ask you to join us at the Mattel family of companies, where our values of Playing with Passion, Playing Together, Playing Fair and Playing to Grow encompass everything that we do. Consider this your invitation to come and “play” with us!

Mattel Sales Corp. (the “Company”) would like to extend you a contingent offer of employment for the position of Chief Brands Officer, reporting to Bryan Stockton, Chairman & Chief Executive Officer, with an anticipated start date no later than June 9, 2014. This letter provides an overview of some of the compensation and benefit offerings that would be available to you as an employee of the Company, should you choose to accept our offer.

SALARY

Your annualized base salary will be $735,000, payable on a bi-weekly basis, less applicable federal and state taxes and other required withholdings. As this is an exempt position, you are not eligible for overtime pay. Our workweek is Monday through Sunday and paychecks are issued every other Friday for the previous two workweeks.

MATTEL INCENTIVE PLAN

You will be eligible to participate in the Mattel Incentive Plan (MIP), which is our way of rewarding our employees for achieving success. The MIP is an annual, cash bonus plan that provides employees the opportunity to earn an award based on Mattel’s financial performance. Your MIP award opportunity is the following percentages of your eligible earnings: target of 70% and maximum of 140%; however, the amount of your actual award, if any, may be more or less than your target depending on Mattel’s financial results pursuant to the terms of the MIP and the performance targets established by the Compensation Committee of the Board of Directors. Mattel, Inc. must achieve a minimum financial performance goal before an award pool is generated. Your 2014 MIP payout, if any, will not be prorated based on your hire date.

Awards are typically paid during the first quarter of the following year.

LONG-TERM INCENTIVE PROGRAM

You will be eligible to participate in the 2014 – 2016 Long-Term Incentive Program (“LTIP”) at a target grant value of $1,200,000 and a maximum value of $2,400,000. Although the grant date will be your hire date, your target grant value and the LTIP’s three-year performance cycle will not be prorated based on your hire date.

SIGNING BONUS

You will receive a signing bonus in the gross amount of $300,000, less applicable federal and state taxes and other required withholdings, typically payable within 30 days following your start date. If, within two years of your hire date, (i) you choose to voluntarily terminate your employment with the Company when the Company has not changed your title as Chief Brands Officer, has not materially diminished your responsibilities for Mattel Global Brands Team Boys & Girls and Global Brands Team Fisher-Price or has not changed your reporting structure, or (ii) you are discharged for “cause” as defined below, you agree to repay this amount in full within 30 days of your termination date.

SPECIAL MOBILITY BONUS

You will receive a special mobility bonus in the amount of $200,000, less applicable federal and state taxes and other required withholdings, to assist with your relocation to Mattel Headquarters in El Segundo, California.

With respect to this special mobility bonus, if within two years of your hire date, (i) you choose to voluntarily terminate your employment with the Company when the Company has not changed your title as Chief Brands Officer, has not materially diminished your responsibilities for Mattel Global Brands Team Boys & Girls and Global Brands Team Fisher-Price or has not changed your reporting structure, or (ii) you are discharged for “cause” as defined below, you will be required to repay this amount in full within 30 days of your termination date.

For the purpose of the repayment of your signing bonus and special mobility bonus only, “cause” shall mean the Company’s good faith belief that you: (i) neglected significant duties you were required to perform or violated a material policy, rule or guideline; (ii) engaged in an act of dishonesty, fraud, misrepresentation or other act of moral turpitude; (iii) engaged in an act or omission in the course of your employment which constitutes gross negligence; or (iv) willfully failed to obey a lawful direction of the Company or its Board of Directors; provided that, in each case, unless the described activity cannot be cured, corrected or ceased, you have received written notice of the described activity, have been provided a reasonable opportunity to cure or correct the activity described in the notice, and have failed to substantially cure, correct or cease the activity, as appropriate.

EQUITY COMPENSATION GRANTS

You will receive an equity compensation award valued at $2,000,000 on the grant date, pursuant to our 2010 Equity and Long-Term Compensation Plan. The grant date will be your hire date.

The Company’s portfolio approach to equity awards encompasses two grants and, if approved, your award will include:

• Restricted Stock Units: Restricted stock units (RSUs) with a grant value of $1,400,000. The grant dollar value of the RSUs will be converted into a number of RSUs by dividing the grant dollar value by the closing stock price on the date of grant.

– If you remain employed by the Company, the RSU grant will generally vest over the three-year period following the date of the grant: 50% on the second anniversary of the grant, and 50% on the third anniversary of the grant.

– If the RSUs vest, you will receive shares of Mattel, Inc. common stock (subject to tax withholding, as applicable).

– If Mattel pays a cash dividend, you will receive dividend equivalents with respect to your unvested RSUs.

• Stock Options: A stock option grant to purchase shares of Mattel, Inc. common stock with a grant value of $600,000. The grant dollar value of the stock options will be converted into a number of option shares by dividing the grant dollar value by the product of an option valuation percentage (determined using a Black-Scholes value relative to the stock price), multiplied by the closing stock price on the date of grant.

– If you remain employed by the Company, the stock option grant will generally vest in annual installments over the three-year period following the date of the grant: 33% on the first anniversary of the grant, 33% on the second anniversary of the grant, and 34% on the third anniversary of the grant.

– The exercise price of the stock options will equal the closing price of Mattel, Inc. common stock on the date of grant.

Please note this is a summary of your equity compensation award, and you will be required to sign the equity grant agreements that set forth the terms and conditions that govern your equity grants.

You will also be eligible to receive an annual equity compensation award. Typically, equity grants are made around August 1 of each year. Your annual grant award recommendation may vary each year

and will be submitted to the Compensation Committee of the Board of Directors for approval pursuant to our 2010 Equity and Long-Term Compensation Plan. For the August 1, 2014 annual equity grant, the grant value shall be no less than $800,000. Currently, the Company’s portfolio approach to equity awards encompasses two grants; restricted stock units and stock options.

CAR ALLOWANCE

As an executive, you will be eligible to receive a monthly automobile allowance in the amount of $2,000 for all your automobile expenses, payable on a biweekly basis, less applicable federal and state taxes and other required withholdings. The car allowance is intended to cover all automobile expenses including mileage, gasoline, maintenance and insurance.

DEFERRED COMPENSATION

As an executive, you will be eligible to participate in the Company’s Deferred Compensation & PIP Excess Plan. Under this plan, you may elect to defer a portion of your salary or bonus and will receive Company contributions that could not be made into the Company’s 401(k) plan due to Internal Revenue Code limitations, with various investment and payment options available.

FINANCIAL COUNSELING

As a senior executive, you will be eligible to receive financial counseling services from The Ayco Company paid for by Mattel, subject to imputed income and tax, or alternatively, you may elect to receive reimbursement from Mattel of up to $10,000 per year, less applicable taxes, for financial counseling services through a company of your choice.

STOCK OWNERSHIP

As a Division Leadership level executive, you will be subject to stock ownership guidelines established as a multiple of base salary. Your stock ownership requirement will be three times your base salary. You will have five years to attain your targeted level of ownership beginning upon your hire date.

HEALTH & WELFARE

The following is a brief outline of benefits in which you and your qualified dependents, if applicable, will be eligible to participate in as of your date of hire, with the exception of short & long term disability insurance, which are available upon the successful completion of your first 90 days of employment.

Medical	Life Insurance
Dental	Accidental Death & Dismemberment
Vision	Business Travel Coverage
Prescription	Short & Long Term Disability

In addition, the Company also offers a number of employee programs and services that are designed to create a healthy lifestyle, build your financial future and enhance your work/life balance.

RETIREMENT/401(k)

Mattel provides eligible employees the opportunity to participate in a retirement/401(k) program. If you are age 20 or older, you will be automatically enrolled in the Mattel, Inc. Personal Investment Plan (PIP), which is a 401(k) savings/retirement plan. The PIP offers both Company automatic and matching contributions in addition to employee voluntary contributions as outlined below:

• Company Automatic Contributions: The Company will make automatic contributions to your account ranging from 3% to 8% of your salary, based on your age.

• Employee Contributions: The PlP allows for voluntary employee contributions. To help you get started, you will be initially enrolled at 2% of your eligible compensation on a pre-tax basis, which will be matched dollar-for-dollar by the Company. This contribution will begin automatically within about 45 days of your hire date. The PIP provides you the choice to increase this contribution up to 80% of your eligible compensation, subject to IRS limitations. Please note, you will have the opportunity to opt-out of the 2% pre-tax contribution before the first deduction from your paycheck.

• Company Matching Provision: The Company will match your contributions up to the first 6% of your eligible compensation in your PIP account as follows:

– on a dollar-for-dollar basis up to 2% of your eligible compensation and

– on a fifty-cents-on-the-dollar basis for up to the next 4% of your eligible compensation

You will receive a PIP packet in the mail within two weeks of your first day of employment. This packet will provide additional details regarding your options for increasing, decreasing or cancelling your contribution, as well as the available investment offerings.

To the extent that the Company adopts a severance plan for similarly situated senior executives, you will be eligible to participate in such a plan as determined by the Compensation Committee of the Board of Directors.

GENERAL INFORMATION

This offer letter is only a summary of your compensation and benefits. More details and plan provisions are provided in our Summary Plan Descriptions, Plan Documents or program summaries, which govern and are subject to periodic modification and revision. You will receive specific benefit information and enrollment instructions in the mail.

You will be subject to the Mattel, Inc. Compensation Recovery Policy (the “Compensation Recovery Policy”), and accordingly, amounts paid or payable to you by the Company shall be subject to the terms and conditions of the Compensation Recovery Policy, as may be amended from time to time.

This offer letter supersedes any prior communications you may have had with Company employees and/or representatives, and reflects the entire understanding between you and the Company, regarding the terms of employment being offered to you. No Company employee and/or representative has authority to make any promise related to this offer that is not contained in this letter and, by signing below, you affirm that you have not signed this offer letter in reliance on any such promise. By signing below, you also affirm that your negotiation, acceptance or performance of this offer letter does not violate or conflict with any agreement or arrangement you have with any third party. If the Company determines (in its sole discretion) that your affirmation may be inaccurate for any reason, it can be a basis for termination “with cause.”

While we look forward to welcoming you to Mattel, this offer is contingent upon satisfactory completion of a background check, including verification of all information listed on your resume, employment application and any other supporting documentation provided, such as previous employers and academic institutions attended, and eligibility to work in the United States. In addition, as a condition of your employment, you will need to sign an Employee Confidentiality and Inventions Agreement (in which you will be asked to disclose all prior inventions, if any, that you own), certify that you will, at all times, comply with the Company’s Code of Conduct, and complete a Conflict of Interest Questionnaire. If you would like to review any of these forms before you make your decision to accept our offer, your recruiter will be able to provide them.

The terms of this offer letter do not imply employment for a definite period. This means that your employment will be at-will, and either you or the Company can terminate it at any time, for any or no reason, with or without cause or advance notice. This at-will relationship cannot be changed by any statement, act, series of events, or pattern of conduct and can only be changed by an express, written agreement signed by the Chief Human Resources Officer or Chief Executive Officer of Mattel, Inc.

Also, please note that as an executive of the Company, and an officer, you will be considered an Insider for purposes of Mattel’s Insider Trading Policy and are subject to window period restrictions. This means that you are restricted to conducting transactions in Mattel stock ONLY during open window periods. Examples of such transactions include sales of shares underlying a stock option (including sales of shares to generate cash to pay the exercise price) and changes in elections in the Mattel stock fund of Mattel’s 401(k) plan. For more information about the Policy and its restrictions, you can access and/or obtain a copy of the Policy on Mattel’s Code of Conduct website. So long as you have received advance approval from the Chief Executive Officer, (i) you may serve on civic or charitable boards to the extent such activities do not materially interfere with the performance of your duties and responsibilities, or (ii) you may serve on corporate boards of directors of corporations that do not directly compete with Mattel.

Should you choose to accept our offer, you will receive a packet containing information and forms that you will need to complete before starting with us. Please bring these completed forms with you, along with the documents noted in the New Hire Checklist, on your first day at the Company.

Richard, we are sincerely pleased to extend this contingent offer of employment and look forward to hearing from you soon. If you accept the terms of our offer as noted above, please sign below and return this letter in the enclosed envelope. If I can answer any questions, please do not hesitate to call me at [omitted].

We hope that you will choose to come and “play” for Mattel, and help us continue the tradition of bringing smiles to children around the world.

Sincerely,

/s/ Alan Kaye

Alan Kaye

Executive Vice President & Chief Human Resources Officer

Agreed and accepted:
/s/ Richard Dickson	5/19/14
Richard Dickson	Date

EX-12.0

EXHIBIT 12.0

MATTEL, INC. AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(Unaudited; in thousands, except ratios)	For the Six Months Ended June 30, 2014			For the Years Ended December 31,
				2013		2012		2011		2010		2009
Earnings Available for Fixed Charges:
(Loss) Income from continuing operations before income taxes	$	(23,792	)	$	1,099,128	$	945,045	$	970,673	$	846,825	$	660,047
Add: Non-controlling interest losses in consolidated subsidiaries		—			—		—		—		—		222
Add:
Interest expense		36,211			78,505		88,835		75,332		64,839		71,843
Appropriate portion of rents (a)		19,770			37,006		33,736		30,696		34,544		34,439
Earnings available for fixed charges	$	32,189		$	1,214,639	$	1,067,616	$	1,076,701	$	946,208	$	766,551
Fixed Charges:
Interest expense	$	36,211		$	78,505	$	88,835	$	75,332	$	64,839	$	71,843
Appropriate portion of rents (a)		19,770			37,006		33,736		30,696		34,544		34,439
Fixed charges	$	55,981		$	115,511	$	122,571	$	106,028	$	99,383	$	106,282
Ratio of earnings to fixed charges		(b	)		10.52 X		8.71 X		10.15 X		9.52 X		7.21 X

(a) Portion of rental expenses that is deemed representative of an interest factor, which is one-third of total rental expense.

(b) Earnings for the six months ended June 30, 2014 were inadequate to cover fixed charges by $23.8 million.

EX-31.0

EXHIBIT 31.0

CERTIFICATION

I, Bryan G. Stockton, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Mattel, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 29, 2014	By:	/s/ BRYAN G. STOCKTON
		Bryan G. Stockton Chairman and Chief Executive Officer (Principal executive officer)

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, Kevin M. Farr, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Mattel, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 29, 2014	By:	/s/ KEVIN M. FARR
		Kevin M. Farr Chief Financial Officer (Principal financial officer)

EX-32.0

EXHIBIT 32.0

CERTIFICATIONS PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Mattel, Inc. a Delaware corporation (the “Company”), on Form 10-Q for the quarter ended June 30, 2014, as filed with the Securities and Exchange Commission (the “Report”), Bryan G. Stockton, Chairman and Chief Executive Officer, and Kevin M. Farr, Chief Financial Officer, of the Company, do each hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350) that, to his knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 29, 2014	By:	/s/ BRYAN G. STOCKTON
		Bryan G. Stockton
		Chairman and Chief Executive Officer
		/s/ KEVIN M. FARR
		Kevin M. Farr
		Chief Financial Officer

XML

Derivative Instruments (Tables)

6 Months Ended

Jun. 30, 2014

Derivative Assets and Liabilities

The following table presents Mattel’s derivative assets and liabilities:

	Asset Derivatives
	Balance Sheet Classification	Fair Value
		June 30, 2014		June 30, 2013		December 31, 2013
				(In thousands)
Derivatives designated as hedging instruments:
Foreign currency forward exchange contracts	Prepaid expenses and other current assets	$	2,938	$	7,389	$	415
Foreign currency forward exchange contracts	Other noncurrent assets		541		—		—
Total derivatives designated as hedging instruments		$	3,479	$	7,389	$	415
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Prepaid expenses and other current assets	$	4,323	$	—	$	1,895
Total		$	7,802	$	7,389	$	2,310
	Liability Derivatives
	Balance Sheet Classification	Fair Value
		June 30, 2014		June 30, 2013		December 31, 2013
				(In thousands)
Derivatives designated as hedging instruments:
Foreign currency forward exchange contracts	Accrued liabilities	$	10,028	$	2,436	$	12,432
Foreign currency forward exchange contracts	Other noncurrent liabilities		75		—		470
Total derivatives designated as hedging instruments		$	10,103	$	2,436	$	12,902
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Accrued liabilities	$	299	$	2,642	$	1,711
Total		$	10,402	$	5,078	$	14,613

Derivatives Designated as Hedging Instruments by Classification and Amount of Gains and Losses

The following tables present the classification and amount of gains and losses, net of tax, from derivatives reported in the consolidated statements of operations:

	For the Three Months Ended June 30, 2014						For the Three Months Ended June 30, 2013						Statements of Operations  Classification
	Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations			Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations
	(In thousands)
Derivatives designated as hedging instruments
Foreign currency forward exchange contracts	$	(5,536	)	$	(2,830	)	$	(872	)	$	(326	)	Cost of sales
	For the Six Months Ended June 30, 2014						For the Six Months Ended June 30, 2013						Statements of Operations  Classification
	Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations			Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations
	(In thousands)
Derivatives designated as hedging instruments
Foreign currency forward exchange contracts	$	(4,308	)	$	(5,597	)	$	7,266		$	803		Cost of sales

Derivatives Not Designated as Hedging Instruments by Classification and Amount of Gains and Losses

	Amount of Gain (Loss) Recognized in the Statements of Operations						Statements of Operations Classification
	For the Three Months Ended June 30, 2014			For the Three Months Ended June 30, 2013
	(In thousands)
Derivatives not designated as hedging instruments
Foreign currency forward exchange contracts	$	2,216		$	(3,546	)	Non-operating income/expense
Foreign currency forward exchange contracts		(1,085	)		(372	)	Cost of sales
Total	$	1,131		$	(3,918	)
	Amount of Gain (Loss) Recognized in the Statements of Operations						Statements of Operations Classification
	For the Six Months Ended June 30, 2014			For the Six Months Ended June 30, 2013
	(In thousands)
Derivatives not designated as hedging instruments
Foreign currency forward exchange contracts	$	9,769		$	(17,321	)	Non-operating income/expense
Foreign currency forward exchange contracts		686			31		Cost of sales
Total	$	10,455		$	(17,290	)

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Other Noncurrent Assets (Parenthetical) (Detail) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Other Noncurrent Assets Disclosure [Line Items]
Accumulated amortization of identifiable intangibles	$ 77.2	$ 68.3	$ 68.8

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Inventories (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Inventory [Line Items]
Raw materials and work in process	$ 140,407	$ 89,863	$ 142,950
Finished goods	744,952	478,980	650,661
Inventories	$ 885,359	$ 568,843	$ 793,611

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Assets Measured and Reported at Fair Value on Recurring Basis Using Significant Level 3 Inputs (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance at beginning of period	$ 28,895
Unrealized gain	2,417
Balance at end of period	$ 31,312

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Other Noncurrent Assets - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Jun. 30, 2013	Jun. 30, 2014 MEGA Brands	Apr. 30, 2014 MEGA Brands
Other Noncurrent Assets Disclosure [Line Items]
Identifiable intangible assets		$ 95.0	$ 95.0
Carrying amount of nonamortizable identifiable intangible asset prior to impairment	113
Remaining fair value of intangible asset	99
Impairment charge	$ 14

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Other Selling and Administrative Expenses (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Component of Operating Other Cost and Expense [Line Items]
Design and development	$ 51,562	$ 47,411	$ 101,059	$ 95,384
Identifiable intangible asset amortization	$ 7,622	$ 2,928	$ 10,253	$ 5,731

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Segment Information (Tables)

6 Months Ended

Jun. 30, 2014

Segment Revenues and Segment Income

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Revenues by Segment
North America	$	513,463		$	566,471		$	954,894		$	1,022,940
International		569,936			627,896			1,059,175			1,154,907
American Girl		87,731			83,757			198,289			188,707
Gross sales		1,171,130			1,278,124			2,212,358			2,366,554
Sales adjustments		(108,878	)		(109,015	)		(203,929	)		(201,839	)
Net sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715
Segment Income (Loss)
North America	$	39,497		$	83,966		$	88,220		$	152,093
International		30,854			77,100			62,334			139,095
American Girl		(1,263	)		(4,792	)		7,981			7,163
		69,088			156,274			158,535			298,351
Corporate and other expense (a)		(68,080	)		(61,484	)		(151,309	)		(137,730	)
Operating income		1,008			94,790			7,226			160,621
Interest expense		18,965			18,259			36,211			38,596
Interest (income)		(2,186	)		(1,289	)		(3,465	)		(2,689	)
Other non-operating (income) expense, net		(1,400	)		(909	)		(1,728	)		1,820
(Loss) Income before income taxes	$	(14,371	)	$	78,729		$	(23,792	)	$	122,894

(a) Corporate and other expense includes severance and other termination-related costs of $12.6 million and $34.1 million for the three and six months ended June 30, 2014, respectively, and $8.0 million and $13.5 million for the three and six months ended June 30, 2013, respectively, and share-based compensation expense of $11.8 million and $24.5 million for the three and six months ended June 30, 2014, respectively, and $13.7 million and $27.6 million for the three and six months ended June 30, 2013, respectively.

Segment Assets

Segment assets are comprised of accounts receivable and inventories, net of applicable reserves and allowances.

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Assets by Segment
North America	$	700,968	$	645,334	$	723,886
International		835,707		850,907		920,770
American Girl		135,395		117,011		100,438
		1,672,070		1,613,252		1,745,094
Corporate and other		92,147		126,086		83,854
Accounts receivable and inventories, net	$	1,764,217	$	1,739,338	$	1,828,948

Worldwide Revenues by Brand Category

The table below presents worldwide revenues by brand category:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Worldwide Revenues by Brand Category
Mattel Girls & Boys Brands	$	688,977		$	792,428		$	1,345,838		$	1,484,598
Fisher-Price Brands		328,766			396,730			600,209			683,995
American Girl Brands		83,146			78,174			189,084			178,629
Construction and Arts & Crafts Brands		61,600			—			61,600			—
Other		8,641			10,792			15,627			19,332
Gross sales		1,171,130			1,278,124			2,212,358			2,366,554
Sales adjustments		(108,878	)		(109,015	)		(203,929	)		(201,839	)
Net sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715

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Goodwill (Tables)

6 Months Ended

Jun. 30, 2014

Goodwill

The change in the carrying amount of goodwill by operating segment for the six months ended June 30, 2014 is shown below. Brand-specific goodwill held by foreign subsidiaries is allocated to the North America and American Girl operating segments selling those brands, thereby causing a foreign currency translation impact for these operating segments.

	December 31, 2013		Acquisition		Currency Exchange Rate Impact			June 30, 2014
	(In thousands)
North America	$	547,595	$	171,062	$	1,267		$	719,924
International		321,656		139,960		3,262			464,878
American Girl		213,988		—		(24	)		213,964
Total goodwill	$	1,083,239	$	311,022	$	4,505		$	1,398,766

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Currency Transaction Gains (Losses) (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Currency Transaction Gains (Losses) [Line Items]
Net transaction gains (losses)	$ 7,730	$ 2,181	$ 14,867	$ 13,193
Operating income
Currency Transaction Gains (Losses) [Line Items]
Net transaction gains (losses)	7,722	3,235	15,791	14,115
Other non-operating income (expense), net
Currency Transaction Gains (Losses) [Line Items]
Net transaction gains (losses)	$ 8	$ (1,054)	$ (924)	$ (922)

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Earnings Per Share - Additional Information (Detail) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Nonqualified stock options and non-participating RSUs excluded from the calculation of diluted net income per common share	1.5	0.1	1.4	0.1

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Seasonal Financing - Additional Information (Detail) (USD $) In Billions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
2013 Credit Facility
Debt Instrument [Line Items]
Terms of credit facility	The agreement governing the credit facility was amended and restated on March 11, 2013 to, among other things, (i) extend the maturity date of the credit facility to March 12, 2018, (ii) increase aggregate commitments under the credit facility to $1.60 billion, with an “accordion feature,” which allows Mattel to increase the aggregate availability under the credit facility to $1.85 billion under certain circumstances, (iii) decrease the applicable interest rate margins to a range of 0.00% to 0.75% above the applicable base rate for base rate loans and 0.88% to 1.75% above the applicable LIBOR for Eurodollar rate loans, in each case depending on Mattel’s senior unsecured long-term debt rating, and (iv) decrease commitment fees to a range of 0.08% to 0.28% of the unused commitments under the credit facility.
Maturity date	Mar. 12, 2018
Aggregate commitment under the credit facility	$ 1.60
Aggregate commitment under the credit facility, including the accordion feature	1.85
2013 Credit Facility | Minimum
Debt Instrument [Line Items]
Interest rate margin for base rate loans	0.00%
Interest rate margin for Eurodollar rate loans	0.88%
Commitment fee rate for unused commitments	0.08%
2013 Credit Facility | Maximum
Debt Instrument [Line Items]
Interest rate margin for base rate loans	0.75%
Interest rate margin for Eurodollar rate loans	1.75%
Commitment fee rate for unused commitments	0.28%
2011 Credit Facility
Debt Instrument [Line Items]
Aggregate commitment under the credit facility	$ 1.40

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Share-Based Payments - Additional Information (Detail) (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
General vesting period	3 years
Total unrecognized compensation cost related to unvested share-based payments	$ 67,500,000
Weighted average period for unrecognized compensation cost expected to be recognized (in years)	1 year 8 months 12 days
Cash received for stock option exercises	$ 14,566,000	$ 106,826,000
Stock Options | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option expire from date of grant, period	10 years

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Subsequent Event - Additional Information (Detail) (USD $)	3 Months Ended		6 Months Ended		1 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Jul. 17, 2014 Subsequent Event Dividend Declared
Subsequent Event [Line Items]
Dividends declared	$ 0.38	$ 0.36	$ 0.76	$ 0.72	$ 0.38
Dividend payable date					Sep. 19, 2014
Dividend payable, stockholders of record date					Aug. 27, 2014
Dividend announcement date					Jul. 17, 2014

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Contingencies - Additional Information (Detail) (USD $)		1 Months Ended								1 Months Ended			6 Months Ended
	Jun. 30, 2013	Dec. 21, 2013 MGA	Dec. 23, 2013 MGA	Jan. 24, 2013 MGA	Aug. 31, 2011 MGA	Aug. 11, 2011 MGA	Apr. 30, 2011 MGA LegalMatter	Apr. 27, 2009 MGA	Jul. 17, 2008 MGA	Jan. 23, 2014 MGA Minimum	Jan. 31, 2010 Yellowstone	Apr. 30, 1999 Yellowstone	Jun. 30, 2014 Yellowstone	Jul. 26, 2013 Yellowstone
Commitments and Contingencies Disclosure [Line Items]
Historical jury verdict								$ 100,000,000	$ 100,000,000
Claimed trade secrets							26
Other claimed trade secrets							88
Compensatory damages awarded by jury							88,500,000
Reduced compensatory damages awarded by court					85,000,000
Punitive damages awarded					85,000,000
Attorney fees and costs awarded					140,000,000
Compensatory damages, punitive damages, and attorney fees and costs awarded by court					310,000,000
Damages for alleged trade secret misappropriation appealed						170,000,000
Attorney fees and costs appealed						140,000,000
Amount of damages and attorney's fees and costs vacated by the appeals court				172,500,000
Approximate amount of judgment finalized in the District Court, including interest		138,000,000
Payment of Judgment			138,000,000
Litigation accrual	137,800,000			138,000,000
Alleged trade secrets damages claimed										1,000,000,000
Alleged loss of profits												1,000,000
Unpaid accounts receivable													4,000,000
Alleged business investments													3,000,000
Initial court appointed expert estimated loss of profits													1,000,000
Court awarded damages from counterclaim											4,000,000
Damages awarded by Appeals Court including inflation and interest														17,000,000
Counterclaim Awarded By Appeals Court													9,000,000	8,000,000
Reasonably possible range of loss, minimum													0
Reasonably possible range of loss, maximum													$ 22,000,000

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Stock Option and Restricted Stock Unit Compensation Expense (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 11,779	$ 13,719	$ 24,472	$ 27,581
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	1,674	1,609	4,234	4,218
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 10,105	$ 12,110	$ 20,238	$ 23,363

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Fair Value Measurements - Additional Information (Detail) (USD $)	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Financial Instruments [Line Items]
Estimated fair value of long-term debt, including the current portion	$ 2,190,000,000	$ 1,620,000,000	$ 1,690,000,000
Long-term debt	$ 2,100,000,000	$ 1,600,000,000	$ 1,650,000,000

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Income Taxes

6 Months Ended

Jun. 30, 2014

Income Taxes

19. Income Taxes

Mattel’s benefit for income taxes was $40.9 million for the six months ended June 30, 2014, as compared to a provision for income taxes of $11.0 million for the six months ended June 30, 2013. During the three and six months ended June 30, 2014, Mattel recognized net discrete tax benefits of $40.1 million and $36.4 million, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions around the world, settlements, and enacted tax law changes. During the three and six months ended June 30, 2013, Mattel recognized net discrete tax benefits of $11.2 million and $15.2 million, respectively, primarily related to reassessments of prior years’ tax liabilities based on the status of audits and tax filings in various jurisdictions around the world, settlements, and enacted tax law changes.

In the first quarter of 2014, Mattel adopted Accounting Standards Update (“ASU”) 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists, which generally requires an unrecognized tax benefit, or a portion of an unrecognized tax benefit, to be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. However, to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date to settle any additional income taxes that would result from the disallowance of a tax position or the applicable tax law does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. Mattel reclassified unrecognized tax benefits of approximately $44 million, primarily recorded within other noncurrent liabilities, against its noncurrent deferred tax assets upon adoption in the first quarter of 2014. There was no impact on Mattel’s operating results.

In the normal course of business, Mattel is regularly audited by federal, state, and foreign tax authorities. In May 2014, the IRS completed its audit of Mattel’s 2010 and 2011 federal income tax returns. Additionally, the statutes of limitations lapsed with respect to other domestic and foreign jurisdictions. As a result of these events, Mattel recognized net discrete tax benefits of $40.1 million during the three months ended June 30, 2014.

Based on the current status of federal, state, and foreign audits, Mattel believes it is reasonably possible that in the next twelve months, the total unrecognized tax benefits could decrease by approximately $38 million related to the settlement of tax audits and/or the expiration of statutes of limitations. The ultimate settlement of any particular issue with the applicable taxing authority could have a material impact on Mattel’s consolidated financial statements.

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Property, Plant, and Equipment - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2014
Buildings | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	10 years
Buildings | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	30 years
Machinery and equipment | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	3 years
Machinery and equipment | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	10 years
Software | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	3 years
Software | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	7 years
Leasehold improvements | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	10 years
Leasehold improvements | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	20 years
Tools, dies, and molds
Property, Plant and Equipment [Line Items]
Estimated useful lives, years	3 years

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Employee Benefit Plans (Tables)

6 Months Ended

Jun. 30, 2014

Defined benefit pension plans

Components of Net Periodic Benefit Cost

A summary of the components of net periodic benefit cost for Mattel’s defined benefit pension plans is as follows:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Service cost	$	2,715		$	3,789		$	5,312		$	7,688
Interest cost		6,978			6,635			13,919			13,265
Expected return on plan assets		(8,020	)		(7,329	)		(16,023	)		(14,658	)
Amortization of prior service credit		(264	)		(126	)		(528	)		(252	)
Recognized actuarial loss		3,589			5,106			7,176			10,212
	$	4,998		$	8,075		$	9,856		$	16,255

Postretirement benefit plans

Components of Net Periodic Benefit Cost

A summary of the components of net periodic benefit cost for Mattel’s postretirement benefit plans is as follows:
	For the Three Months Ended				For the Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In thousands)
Service cost	$	20	$	22	$	40	$	44
Interest cost		452		338		904		676
Recognized actuarial loss		75		40		150		80
	$	547	$	400	$	1,094	$	800

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Employee Benefit Plans - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Employee Benefits Disclosure [Line Items]
Cash contributions for defined benefit pension plans	$ 7
Cash contributions for postretirement benefit plans	$ 1

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Other Noncurrent Liabilities (Tables)

6 Months Ended

Jun. 30, 2014

Other Noncurrent Liabilities

Other noncurrent liabilities include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Benefit plan liabilities	$	191,817	$	279,005	$	193,046
Noncurrent tax liabilities		157,639		202,441		186,055
Other		168,843		155,107		161,526
	$	518,299	$	636,553	$	540,627

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Goodwill - Additional Information (Detail) (USD $)	1 Months Ended	3 Months Ended	6 Months Ended
	Apr. 30, 2014	Jun. 30, 2014	Jun. 30, 2014
Business Acquisition [Line Items]
Goodwill relating to acquisition			$ 311,022,000
MEGA Brands
Business Acquisition [Line Items]
Percentage of ownership acquired	100.00%
Total cash consideration paid	454,900,000
Identifiable intangible assets	95,000,000	95,000,000	95,000,000
Net assets acquired	48,900,000
Cash	31,600,000
Inventory	85,600,000
Property, plant, and equipment	33,600,000
Accounts payable and accrued liabilities	67,500,000
Long-term debt	44,600,000
Other net assets	10,200,000
Goodwill relating to acquisition	311,000,000
Integration costs recognized		4,000,000	4,000,000
Transaction costs recognized		$ 7,000,000	$ 7,000,000

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Derivatives Designated as Hedging Instruments by Classification and Amount of Gains and Losses (Detail) (Designated As Hedging Instrument, Foreign Exchange Forward, USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Designated As Hedging Instrument | Foreign Exchange Forward
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain (loss) recognized in OCI	$ (5,536)	$ (872)	$ (4,308)	$ 7,266
Amount of gain (loss) reclassified from accumulated OCI to statements of operations	$ (2,830)	$ (326)	$ (5,597)	$ 803

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Other Noncurrent Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Other Liabilities [Line Items]
Benefit plan liabilities	$ 191,817	$ 193,046	$ 279,005
Noncurrent tax liabilities	157,639	186,055	202,441
Other	168,843	161,526	155,107
Total other noncurrent liabilities	$ 518,299	$ 540,627	$ 636,553

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Accounts Receivable - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable, allowances for doubtful accounts	$ 21.4	$ 20.4	$ 35.9

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Inventories

6 Months Ended

Jun. 30, 2014

Inventories

3. Inventories

Inventories include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Raw materials and work in process	$	140,407	$	142,950	$	89,863
Finished goods		744,952		650,661		478,980
	$	885,359	$	793,611	$	568,843

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Changes in Accumulated Balances for Each Component of Other Comprehensive Income (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of Beginning Period	$ (433,721)	$ (481,425)	$ (443,676)	$ (464,486)
Other comprehensive (loss) income before reclassifications	28,434	(37,941)	33,442	(56,871)
Amounts reclassified from accumulated other comprehensive income (loss)	5,023	3,446	9,970	5,437
Other Comprehensive Income (Loss), Net of Tax	33,457	(34,495)	43,412	(51,434)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of End Period	(400,264)	(515,920)	(400,264)	(515,920)
Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of Beginning Period	(6,794)	4,426	(10,789)	(2,583)
Other comprehensive (loss) income before reclassifications	(5,536)	(872)	(4,308)	7,266
Amounts reclassified from accumulated other comprehensive income (loss)	2,830	326	5,597	(803)
Other Comprehensive Income (Loss), Net of Tax	(2,706)	(546)	1,289	6,463
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of End Period	(9,500)	3,880	(9,500)	3,880
Defined Benefit Pension Plans
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of Beginning Period	(129,858)	(187,225)	(131,946)	(190,656)
Other comprehensive (loss) income before reclassifications	464	314	372	625
Amounts reclassified from accumulated other comprehensive income (loss)	2,193	3,120	4,373	6,240
Other Comprehensive Income (Loss), Net of Tax	2,657	3,434	4,745	6,865
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of End Period	(127,201)	(183,791)	(127,201)	(183,791)
Currency Translation Adjustments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of Beginning Period	(297,069)	(298,626)	(300,941)	(271,247)
Other comprehensive (loss) income before reclassifications	33,506	(37,383)	37,378	(64,762)
Other Comprehensive Income (Loss), Net of Tax	33,506	(37,383)	37,378	(64,762)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of End Period	$ (263,563)	$ (336,009)	$ (263,563)	$ (336,009)

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Share-Based Payments (Tables)

6 Months Ended

Jun. 30, 2014

Stock Option and Restricted Stock Unit Compensation Expense

Compensation expense, included within other selling and administrative expenses in the consolidated statement of operations, related to stock options and RSUs is as follows:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In thousands)
Stock option compensation expense	$	1,674	$	1,609	$	4,234	$	4,218
RSU compensation expense		10,105		12,110		20,238		23,363
	$	11,779	$	13,719	$	24,472	$	27,581

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Subsequent Event

6 Months Ended

Jun. 30, 2014

Subsequent Event

23. Subsequent Event

On July 17, 2014, Mattel announced that its Board of Directors declared a third quarter dividend of $0.38 per common share. The dividend is payable on September 19, 2014 to stockholders of record on August 27, 2014.

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New Accounting Pronouncements

6 Months Ended

Jun. 30, 2014

New Accounting Pronouncements

22. New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) 605, Revenue Recognition, and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance establishes a five-step model to achieve that core principle and also requires additional disclosures about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. ASU 2014-09 will be effective for interim and annual reporting periods beginning after December 15, 2016. Early application is not permitted. Mattel is currently evaluating the impact of the adoption of ASU 2014-09 on its operating results and financial position.

In June 2014, the FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period, which requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. ASU 2014-12 will be effective for interim and annual reporting periods beginning after December 15, 2015. Early application is permitted. Mattel is currently evaluating the impact of the adoption of ASU 2014-12 on its operating results and financial position.

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Accrued Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Schedule of Accrued Liabilities [Line Items]
Royalties	$ 63,366	$ 100,542	$ 55,904
Advertising and promotion	52,506	76,453	9,378
Taxes other than income taxes	33,530	70,121	48,492
Litigation accrual			137,800
Other	332,441	393,039	332,627
Total accrued liabilities	$ 481,843	$ 640,155	$ 584,201

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Other Selling and Administrative Expenses (Tables)

6 Months Ended

Jun. 30, 2014

Other Selling and Administrative Expenses

Other selling and administrative expenses include the following:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In thousands)
Design and development	$	51,562	$	47,411	$	101,059	$	95,384
Identifiable intangible asset amortization		7,622		2,928		10,253		5,731

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Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2014

Property, Plant, and Equipment Policy

Property, plant, and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over estimated useful lives of 10 to 30 years for buildings, 3 to 10 years for machinery and equipment, 3 to 7 years for software, and 10 to 20 years, not to exceed the lease term, for leasehold improvements. Tools, dies, and molds are depreciated using the straight-line method over 3 years. Estimated useful lives are periodically reviewed and, where appropriate, changes are made prospectively. The carrying value of property, plant, and equipment is reviewed when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Any potential impairment identified is assessed by evaluating the operating performance and future undiscounted cash flows of the underlying assets. When property is sold or retired, the cost of the property and the related accumulated depreciation are removed from the consolidated balance sheet, and any resulting gain or loss is included in the results of operations.

Goodwill Policy

Mattel tests its goodwill for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying value of a reporting unit may exceed its fair value.

Intangible Assets, Indefinite-Lived, Policy

Mattel tests nonamortizable intangible assets, including trademarks and trade names, for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying values may exceed the fair values.

Intangible Assets, Finite-Lived, Policy

Mattel also tests its amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable.

Debt Policy

The proportion of unamortized debt issuance costs from the prior facility renewal related to creditors involved in both the prior facility and amended facility and borrowing costs incurred as a result of the amendment were deferred, and such costs will be amortized over the term of the amended facility.

Foreign Currency Translations Policy

Mattel’s reporting currency is the US dollar. The translation of its net investments in subsidiaries with non-US dollar functional currencies subjects Mattel to the impact of currency exchange rate fluctuations in its results of operations and financial position. Assets and liabilities of subsidiaries with non-US dollar functional currencies are translated into US dollars at fiscal period-end exchange rates. Income, expense, and cash flow items are translated at weighted average exchange rates prevailing during the fiscal period. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive income (loss) within stockholders’ equity.

Derivatives Policy

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 generally have maturity dates of up to 18 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. Additionally, 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.

Earnings Per Share Policy

Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method. Certain of Mattel’s restricted stock units (“RSUs”) are considered participating securities because they contain nonforfeitable rights to dividend equivalents.

Under the two-class method, net income is reduced by the amount of dividends declared in the period for each class of common stock and participating securities. The remaining undistributed earnings are then allocated to common stock and participating securities as if all of the net income for the period had been distributed. Basic earnings per common share excludes dilution and is calculated by dividing net income allocable to common shares by the weighted average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net income allocable to common shares by the weighted average number of common shares for the period, as adjusted for the potential dilutive effect of non-participating share-based awards.

Foreign Currency Transaction Gains and Losses Policy

Currency exchange rate fluctuations may impact Mattel’s results of operations and cash flows. Mattel’s currency transaction exposures include gains and losses realized on unhedged inventory purchases and unhedged receivables and payables balances that are denominated in a currency other than the applicable functional currency. Gains and losses on unhedged inventory purchases and other transactions associated with operating activities are recorded in the components of operating income to which they relate in the consolidated statements of operations. For hedges of intercompany loans and advances, which do not qualify for hedge accounting treatment, the gains or losses on the hedges resulting from changes in fair value as well as the offsetting transaction gains or losses on the related hedged items, along with unhedged items, are recognized in other non-operating income (expense), net in the consolidated statements of operations.

Segment Reporting Policy

Mattel does not include sales adjustments such as trade discounts and other allowances in the calculation of segment revenues (referred to as “gross sales” and reconciled to net sales in Part I, Item 2 “Non-GAAP Financial Measure” of this Quarterly Report on Form 10-Q). Mattel records these adjustments in its financial accounting systems at the time of sale to each customer, but the adjustments are not allocated to individual products. For this reason, Mattel’s chief operating decision maker uses gross sales by segment as one of the metrics to measure segment performance. Such sales adjustments are included in the determination of segment income from operations based on the adjustments recorded in the financial accounting systems. Segment income represents each segment’s operating income, while consolidated operating income represents income from operations before net interest, other non-operating (income) expense, and income taxes as reported in the consolidated statements of operations. The corporate and other expense category includes costs not allocated to individual segments, including charges related to incentive compensation, share-based payments, and corporate headquarters functions managed on a worldwide basis, and the impact of changes in foreign currency rates on intercompany transactions.

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Inventories (Tables)

6 Months Ended

Jun. 30, 2014

Inventories

Inventories include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Raw materials and work in process	$	140,407	$	142,950	$	89,863
Finished goods		744,952		650,661		478,980
	$	885,359	$	793,611	$	568,843

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Accounts Receivable

6 Months Ended

Jun. 30, 2014

Accounts Receivable

2. Accounts Receivable

Accounts receivable are net of allowances for doubtful accounts of $21.4 million, $35.9 million, and $20.4 million as of June 30, 2014, June 30, 2013, and December 31, 2013, respectively.

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Property, Plant, and Equipment (Tables)

6 Months Ended

Jun. 30, 2014

Property, Plant, and Equipment

Property, plant, and equipment, net includes the following:

	June 30, 2014			June 30, 2013			December 31, 2013
	(In thousands)
Land	$	27,666		$	26,605		$	27,555
Buildings		272,169			268,985			269,874
Machinery and equipment		709,002			680,861			673,546
Software		317,388			275,626			301,284
Tools, dies, and molds		763,490			709,723			713,749
Capital leases		23,921			23,271			23,271
Leasehold improvements		233,937			221,322			230,271
		2,347,573			2,206,393			2,239,550
Less: accumulated depreciation		(1,643,140	)		(1,585,225	)		(1,580,217	)
	$	704,433		$	621,168		$	659,333

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Segment Revenues and Segment Income (Parenthetical) (Detail) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Segment Reporting Information [Line Items]
Share-based compensation expense	$ 11,779,000	$ 13,719,000	$ 24,472,000	$ 27,581,000
Corporate and Other
Segment Reporting Information [Line Items]
Severance expense	12,600,000	8,000,000	34,100,000	13,500,000
Share-based compensation expense	$ 11,800,000	$ 13,700,000	$ 24,500,000	$ 27,600,000

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2014

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

Mattel’s financial assets and liabilities measured and reported at fair value on a recurring basis include the following:

	June 30, 2014
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	7,802	$	—	$	7,802
Auction rate security (b)		—		—		31,312		31,312
Total assets	$	—	$	7,802	$	31,312	$	39,114
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	10,402	$	—	$	10,402
	June 30, 2013
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	7,389	$	—	$	7,389
Auction rate security (b)		—		—		23,222		23,222
Total assets	$	—	$	7,389	$	23,222	$	30,611
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	5,078	$	—	$	5,078
	December 31, 2013
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	2,310	$	—	$	2,310
Auction rate security (b)		—		—		28,895		28,895
Total assets	$	—	$	2,310	$	28,895	$	31,205
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	14,613	$	—	$	14,613

(a) The fair value of the foreign currency forward exchange contracts is 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.

(b) The fair value of the auction rate security is estimated using a discounted cash flow model based on (i) estimated interest rates, timing, and amount of cash flows, (ii) credit spreads, recovery rates, and credit quality of the underlying securities, (iii) illiquidity considerations, and (iv) market correlation.

Reconciliation of Fair Value of Assets Measured Using Level 3 Inputs

The following table presents information about Mattel’s auction rate security measured and reported at fair value on a recurring basis using significant Level 3 inputs:

	Level 3
	(In thousands)
Balance at December 31, 2013	$	28,895
Unrealized gain		2,417
Balance at June 30, 2014	$	31,312

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Other Noncurrent Assets (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Other Noncurrent Assets Disclosure [Line Items]
Nonamortizable identifiable intangibles	$ 517,378	$ 504,241	$ 504,241
Deferred income taxes	424,184	373,638	439,937
Identifiable intangibles (net of amortization of $77.2 million, $68.3 million, and $68.8 million, respectively)	261,636	176,579	182,005
Other	286,791	264,603	249,796
Total other noncurrent assets	$ 1,489,989	$ 1,319,061	$ 1,375,979

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Earnings Per Share (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013		Jun. 30, 2014		Jun. 30, 2013
Basic:
Net Income	$ 28,325		$ 73,348		$ 17,107		$ 111,859
Less: net income allocable to participating RSUs	(265)	[1]	(725)	[1]	(199)	[1]	(1,131)	[1]
Net income available for basic common shares	28,060		72,623		16,908		110,728
Weighted average common shares outstanding	338,709		346,614		339,463		345,453
Basic net income per common share	$ 0.08		$ 0.21		$ 0.05		$ 0.32
Diluted:
Net Income	28,325		73,348		17,107		111,859
Less: net income allocable to participating RSUs	(270)	[1]	(730)	[1]	(212)	[1]	(1,147)	[1]
Net income available for diluted common shares	$ 28,055		$ 72,618		$ 16,895		$ 110,712
Weighted average common shares outstanding	338,709		346,614		339,463		345,453
Weighted average common equivalent shares arising from:
Dilutive stock options and non-participating RSUs	1,935		3,810		2,131		4,050
Weighted average number of common and potential common shares	340,644		350,424		341,594		349,503
Diluted net income per common share	$ 0.08		$ 0.21		$ 0.05		$ 0.32

[1] During the three and six months ended June 30, 2014 and 2013, Mattel allocated a proportionate share of both dividends and undistributed earnings to participating RSUs.

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Current Assets
Cash and equivalents	$ 518,217	$ 1,039,216	$ 823,019
Accounts receivable, net	878,858	1,260,105	945,727
Inventories	885,359	568,843	793,611
Prepaid expenses and other current assets	602,874	509,829	564,804
Total current assets	2,885,308	3,377,993	3,127,161
Noncurrent Assets
Property, plant, and equipment, net	704,433	659,333	621,168
Goodwill	1,398,766	1,083,239	1,072,084
Other noncurrent assets	1,489,989	1,319,061	1,375,979
Total Assets	6,478,496	6,439,626	6,196,392
Current Liabilities
Short-term borrowings	20,481	4,278	40,701
Current portion of long-term debt			50,000
Accounts payable	385,655	375,328	337,511
Accrued liabilities	481,843	640,155	584,201
Income taxes payable	20,651	27,679	25,978
Total current liabilities	908,630	1,047,440	1,038,391
Noncurrent Liabilities
Long-term debt	2,100,000	1,600,000	1,600,000
Other noncurrent liabilities	518,299	540,627	636,553
Total noncurrent liabilities	2,618,299	2,140,627	2,236,553
Stockholders' Equity
Common stock $1.00 par value, 1.0 billion shares authorized; 441.4 million shares issued	441,369	441,369	441,369
Additional paid-in capital	1,771,095	1,784,445	1,778,242
Treasury stock at cost: 103.7 million shares, 102.1 million shares, and 96.2 million shares, respectively	(2,534,981)	(2,448,701)	(2,156,651)
Retained earnings	3,674,348	3,918,122	3,374,408
Accumulated other comprehensive loss	(400,264)	(443,676)	(515,920)
Total stockholders' equity	2,951,567	3,251,559	2,921,448
Total Liabilities and Stockholders' Equity	$ 6,478,496	$ 6,439,626	$ 6,196,392

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Foreign Currency Transaction Gains and Losses (Tables)

6 Months Ended

Jun. 30, 2014

Currency Transaction Gains (Losses)

Currency transaction gains (losses) included in the consolidated statements of operations are as follows:

	For the Three Months Ended					For the Six Months Ended
	June 30, 2014		June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Operating income	$	7,722	$	3,235		$	15,791		$	14,115
Other non-operating income (expense), net		8		(1,054	)		(924	)		(922	)
Net transaction gains	$	7,730	$	2,181		$	14,867		$	13,193

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Cash Flows From Operating Activities:
Net Income	$ 17,107	$ 111,859
Adjustments to reconcile net income to net cash flows used for operating activities:
Depreciation	97,582	86,647
Amortization	12,242	8,331
Asset impairment		14,000
Deferred income taxes	(28,971)	(26,182)
Tax benefits from share-based payment arrangements	(16,628)	(40,113)
Share-based compensation	24,472	27,581
Increase (decrease) from changes in assets and liabilities:
Accounts receivable	414,563	261,907
Inventories	(231,120)	(348,613)
Prepaid expenses and other current assets	(79,710)	(41,182)
Accounts payable, accrued liabilities, and income taxes payable	(266,647)	(344,817)
Other, net	(22,047)	4,671
Net cash flows used for operating activities	(79,157)	(285,911)
Cash Flows From Investing Activities:
Purchases of tools, dies, and molds	(70,538)	(59,341)
Purchases of other property, plant, and equipment	(37,877)	(55,538)
Payments for acquisition, net of cash acquired	(423,309)
Proceeds (payments) from foreign currency forward exchange contracts	6,615	(15,135)
Other, net	367	(2,462)
Net cash flows used for investing activities	(524,742)	(132,476)
Cash Flows From Financing Activities:
Payments of short-term borrowings, net	(4,278)	(9,844)
Proceeds from short-term borrowings, net	20,481	40,701
Payments of credit facility renewal costs		(4,003)
Payments of long-term borrowings	(44,587)	(350,000)
Proceeds from long-term borrowings, net	495,458	495,260
Share repurchases	(128,165)	(150,787)
Payments of dividends on common stock	(257,669)	(249,083)
Proceeds from exercise of stock options	14,566	106,826
Tax benefits from share-based payment arrangements	16,628	40,113
Other, net	(29,350)	(3,436)
Net cash flows provided by (used for) financing activities	83,084	(84,253)
Effect of Currency Exchange Rate Changes on Cash	(184)	(10,052)
Decrease in Cash and Equivalents	(520,999)	(512,692)
Cash and Equivalents at Beginning of Period	1,039,216	1,335,711
Cash and Equivalents at End of Period	$ 518,217	$ 823,019

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Long-Term Debt (Parenthetical) (Detail)	6 Months Ended		12 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
2010 Senior Notes due October 2020
Debt Instrument [Line Items]
Debt instrument maturity date, month and year	2020-10	2020-10	2020-10
2010 Senior Notes due October 2040
Debt Instrument [Line Items]
Debt instrument maturity date, month and year	2040-10	2040-10	2040-10
2011 Senior Notes due November 2016
Debt Instrument [Line Items]
Debt instrument maturity date, month and year	2016-11	2016-11	2016-11
2011 Senior Notes due November 2041
Debt Instrument [Line Items]
Debt instrument maturity date, month and year	2041-11	2041-11	2041-11
2013 Senior Notes due March 2018
Debt Instrument [Line Items]
Debt instrument maturity date, month and year	2018-03	2018-03	2018-03
2013 Senior Notes due March 2023
Debt Instrument [Line Items]
Debt instrument maturity date, month and year	2023-03	2023-03	2023-03
2014 Senior Notes due May 2019
Debt Instrument [Line Items]
Debt instrument maturity date, month and year	2019-05	2019-05	2019-05

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Accrued Liabilities (Tables)

6 Months Ended

Jun. 30, 2014

Accrued Liabilities

Accrued liabilities include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Royalties	$	63,366	$	55,904	$	100,542
Advertising and promotion		52,506		9,378		76,453
Taxes other than income taxes		33,530		48,492		70,121
Litigation accrual		—		137,800		—
Other		332,441		332,627		393,039
	$	481,843	$	584,201	$	640,155

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Derivative Instruments - Additional Information (Detail) (USD $)				3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended
	Jun. 30, 2014 Foreign Exchange Forward	Dec. 31, 2013 Foreign Exchange Forward	Jun. 30, 2013 Foreign Exchange Forward	Jun. 30, 2014 Foreign Exchange Forward Designated As Hedging Instrument	Jun. 30, 2013 Foreign Exchange Forward Designated As Hedging Instrument	Jun. 30, 2014 Foreign Exchange Forward Designated As Hedging Instrument	Jun. 30, 2013 Foreign Exchange Forward Designated As Hedging Instrument	Jun. 30, 2014 Foreign Exchange Forward Not Designated As Hedging Instrument	Jun. 30, 2013 Foreign Exchange Forward Not Designated As Hedging Instrument	Jun. 30, 2014 Foreign Exchange Forward Not Designated As Hedging Instrument	Jun. 30, 2013 Foreign Exchange Forward Not Designated As Hedging Instrument	Jun. 30, 2014 Maximum
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Maximum term for foreign currency forward exchange contracts												18 months
Notional amount of foreign currency forward exchange contracts	$ 1,430,000,000	$ 1,550,000,000	$ 1,430,000,000
Net (loss) gain reclassified from accumulated other comprehensive loss to the consolidated statements of operations for derivatives designated as hedging instruments				(2,830,000)	(326,000)	(5,597,000)	803,000
Net gain (loss) recognized in the consolidated statements of operations for derivatives not designated as hedging instruments								$ 1,131,000	$ (3,918,000)	$ 10,455,000	$ (17,290,000)

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Share-Based Payments

6 Months Ended

Jun. 30, 2014

Share-Based Payments

16. Share-Based Payments

Mattel has various stock compensation plans, which are more fully described in “Note 7 to the Consolidated Financial Statements–Share-Based Payments” in its 2013 Annual Report on Form 10-K. Under the Mattel, Inc. 2010 Equity and Long-Term Compensation Plan, Mattel has the ability to grant nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, RSUs, performance awards, dividend equivalent rights, and shares of common stock to officers, employees, and other persons providing services to Mattel. Stock options are granted with exercise prices at the fair market value of Mattel’s common stock on the applicable grant date and expire no later than ten years from the date of grant. Both stock options and time-vesting RSUs generally provide for vesting over a period of three years from the date of grant.

Compensation expense, included within other selling and administrative expenses in the consolidated statement of operations, related to stock options and RSUs is as follows:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In thousands)
Stock option compensation expense	$	1,674	$	1,609	$	4,234	$	4,218
RSU compensation expense		10,105		12,110		20,238		23,363
	$	11,779	$	13,719	$	24,472	$	27,581

As of June 30, 2014, total unrecognized compensation cost related to unvested share-based payments totaled $67.5 million and is expected to be recognized over a weighted-average period of 1.7 years.

Mattel uses treasury shares purchased under its share repurchase program to satisfy stock option exercises and the vesting of RSUs. Cash received for stock option exercises for the six months ended June 30, 2014 and 2013 was $14.6 million and $106.8 million, respectively.

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Long-Term Debt (Tables)

6 Months Ended

Jun. 30, 2014

Long-Term Debt

Long-term debt includes the following:

	June 30, 2014		June 30, 2013			December 31, 2013
	(In thousands)
Medium-term notes	$	—	$	50,000		$	—
2010 Senior Notes due October 2020 and October 2040		500,000		500,000			500,000
2011 Senior Notes due November 2016 and November 2041		600,000		600,000			600,000
2013 Senior Notes due March 2018 and March 2023		500,000		500,000			500,000
2014 Senior Notes due May 2019		500,000		—			—
		2,100,000		1,650,000			1,600,000
Less: current portion		—		(50,000	)		—
Total long-term debt	$	2,100,000	$	1,600,000		$	1,600,000

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Foreign Currency Transaction Gains and Losses

6 Months Ended

Jun. 30, 2014

Foreign Currency Transaction Gains and Losses

18. Foreign Currency Transaction Gains and Losses

Currency exchange rate fluctuations may impact Mattel’s results of operations and cash flows. Mattel’s currency transaction exposures include gains and losses realized on unhedged inventory purchases and unhedged receivables and payables balances that are denominated in a currency other than the applicable functional currency. Gains and losses on unhedged inventory purchases and other transactions associated with operating activities are recorded in the components of operating income to which they relate in the consolidated statements of operations. For hedges of intercompany loans and advances, which do not qualify for hedge accounting treatment, the gains or losses on the hedges resulting from changes in fair value as well as the offsetting transaction gains or losses on the related hedged items, along with unhedged items, are recognized in other non-operating income (expense), net in the consolidated statements of operations. Inventory purchase and sale transactions denominated in the Euro, British pound sterling, Mexican peso, Brazilian real, and Indonesian rupiah are the primary transactions that cause foreign currency transaction exposure for Mattel.

Currency transaction gains (losses) included in the consolidated statements of operations are as follows:

	For the Three Months Ended					For the Six Months Ended
	June 30, 2014		June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Operating income	$	7,722	$	3,235		$	15,791		$	14,115
Other non-operating income (expense), net		8		(1,054	)		(924	)		(922	)
Net transaction gains	$	7,730	$	2,181		$	14,867		$	13,193

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Derivatives Not Designated as Hedging Instruments by Classification and Amount of Gains and Losses (Detail) (Not Designated As Hedging Instrument, Foreign Exchange Forward, USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Derivative Instruments, Gain (Loss) [Line Items]
Net gain (loss) recognized in the statements of operations for derivatives not designated as hedging instruments	$ 1,131	$ (3,918)	$ 10,455	$ (17,290)
Non-Operating Income Expense Classification
Derivative Instruments, Gain (Loss) [Line Items]
Net gain (loss) recognized in the statements of operations for derivatives not designated as hedging instruments	2,216	(3,546)	9,769	(17,321)
Cost of Sales Classification
Derivative Instruments, Gain (Loss) [Line Items]
Net gain (loss) recognized in the statements of operations for derivatives not designated as hedging instruments	$ (1,085)	$ (372)	$ 686	$ 31

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Basis of Presentation

6 Months Ended

Jun. 30, 2014

Basis of Presentation

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 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 presentation of the financial position and interim results of Mattel, Inc. and its subsidiaries (“Mattel”) as of and for the periods presented have been included. 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 year-end balance sheet data was derived from audited financial statements; however, the accompanying interim notes to the consolidated financial statements do not include all disclosures required by accounting principles generally accepted in the United States of America.

The financial information included herein should be read in conjunction with Mattel’s consolidated financial statements and related notes in its 2013 Annual Report on Form 10-K.

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Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Per Share data, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Common stock, par value	$ 1.00	$ 1.00	$ 1.00
Common stock, shares authorized	1,000	1,000	1,000
Common stock, shares issued	441.4	441.4	441.4
Treasury stock, shares	103.7	102.1	96.2

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2014

Accumulated Other Comprehensive Income (Loss)

11. Accumulated Other Comprehensive Income (Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income (loss):

	For the Three Months Ended June 30, 2014
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2014	$	(6,794	)	$	(129,858	)	$	(297,069	)	$	(433,721	)
Other comprehensive (loss) income before reclassifications		(5,536	)		464			33,506			28,434
Amounts reclassified from accumulated other comprehensive income (loss)		2,830			2,193			—			5,023
Net (decrease) increase in other comprehensive income		(2,706	)		2,657			33,506			33,457
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2014	$	(9,500	)	$	(127,201	)	$	(263,563	)	$	(400,264	)
	For the Six Months Ended June 30, 2014
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2013	$	(10,789	)	$	(131,946	)	$	(300,941	)	$	(443,676	)
Other comprehensive (loss) income before reclassifications		(4,308	)		372			37,378			33,442
Amounts reclassified from accumulated other comprehensive income (loss)		5,597			4,373			—			9,970
Net increase in other comprehensive income		1,289			4,745			37,378			43,412
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2014	$	(9,500	)	$	(127,201	)	$	(263,563	)	$	(400,264	)
	For the Three Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2013	$	4,426		$	(187,225	)	$	(298,626	)	$	(481,425	)
Other comprehensive (loss) income before reclassifications		(872	)		314			(37,383	)		(37,941	)
Amounts reclassified from accumulated other comprehensive income (loss)		326			3,120			—			3,446
Net (decrease) increase in other comprehensive income		(546	)		3,434			(37,383	)		(34,495	)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)
	For the Six Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2012	$	(2,583	)	$	(190,656	)	$	(271,247	)	$	(464,486	)
Other comprehensive income (loss) before reclassifications		7,266			625			(64,762	)		(56,871	)
Amounts reclassified from accumulated other comprehensive income (loss)		(803	)		6,240			—			5,437
Net increase (decrease) in other comprehensive income		6,463			6,865			(64,762	)		(51,434	)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)

The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statement of operations:

	For the Three Months Ended June 30, 2014			For the Three Months Ended June 30, 2013			Statements of Operations Classification
	(In thousands)
Derivative Instruments
Loss on foreign currency forward exchange contracts	$	(2,859	)	$	(318	)	Cost of sales
		29			(8	)	Provision for income taxes
	$	(2,830	)	$	(326	)	Net income
Defined Benefit Pension Plans
Amortization of prior service credit	$	264		$	126		(a)
Recognized actuarial loss		(3,664	)		(5,146	)	(a)
		(3,400	)		(5,020	)
		1,207			1,900		Provision for income taxes
	$	(2,193	)	$	(3,120	)	Net income
	For the Six Months Ended June 30, 2014			For the Six Months Ended June 30, 2013			Statements of Operations Classification
	(In thousands)
Derivative Instruments
(Loss) gain on foreign currency forward exchange contracts	$	(5,577	)	$	813		Cost of sales
		(20	)		(10	)	Provision for income taxes
	$	(5,597	)	$	803		Net income
Defined Benefit Pension Plans
Amortization of prior service credit	$	528		$	252		(a)
Recognized actuarial loss		(7,326	)		(10,292	)	(a)
		(6,798	)		(10,040	)
		2,425			3,800		Provision for income taxes
	$	(4,373	)	$	(6,240	)	Net income

(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” of this Quarterly Report on Form 10-Q for additional information regarding Mattel’s net periodic benefit cost.

Currency Translation Adjustments

Mattel’s reporting currency is the US dollar. The translation of its net investments in subsidiaries with non-US dollar functional currencies subjects Mattel to the impact of currency exchange rate fluctuations in its results of operations and financial position. Assets and liabilities of subsidiaries with non-US dollar functional currencies are translated into US dollars at fiscal period-end exchange rates. Income, expense, and cash flow items are translated at weighted average exchange rates prevailing during the fiscal period. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive income (loss) within stockholders’ equity. Currency translation adjustments resulted in a net gain of $37.4 million for the six months ended June 30, 2014, primarily due to the strengthening of the British pound sterling, Brazilian real, and Australian dollar against the US dollar, partially offset by the weakening of the Euro. Currency translation adjustments resulted in a net loss of $64.8 million for the six months ended June 30, 2013, primarily due to the weakening of the Euro, Brazilian real, British pound sterling, and Australian dollar against the US dollar.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Jul. 21, 2014
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2
Trading Symbol	MAT
Entity Registrant Name	MATTEL INC /DE/
Entity Central Index Key	0000063276
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		337,847,854

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Derivative Instruments

6 Months Ended

Jun. 30, 2014

Derivative Instruments

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 generally have maturity dates of up to 18 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. Additionally, 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. As of June 30, 2014, June 30, 2013, and December 31, 2013, Mattel held foreign currency forward exchange contracts with notional amounts of approximately $1.43 billion, $1.43 billion, and $1.55 billion, respectively.

The following table presents Mattel’s derivative assets and liabilities:

	Asset Derivatives
	Balance Sheet Classification	Fair Value
		June 30, 2014		June 30, 2013		December 31, 2013
				(In thousands)
Derivatives designated as hedging instruments:
Foreign currency forward exchange contracts	Prepaid expenses and other current assets	$	2,938	$	7,389	$	415
Foreign currency forward exchange contracts	Other noncurrent assets		541		—		—
Total derivatives designated as hedging instruments		$	3,479	$	7,389	$	415
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Prepaid expenses and other current assets	$	4,323	$	—	$	1,895
Total		$	7,802	$	7,389	$	2,310
	Liability Derivatives
	Balance Sheet Classification	Fair Value
		June 30, 2014		June 30, 2013		December 31, 2013
				(In thousands)
Derivatives designated as hedging instruments:
Foreign currency forward exchange contracts	Accrued liabilities	$	10,028	$	2,436	$	12,432
Foreign currency forward exchange contracts	Other noncurrent liabilities		75		—		470
Total derivatives designated as hedging instruments		$	10,103	$	2,436	$	12,902
Derivatives not designated as hedging instruments:
Foreign currency forward exchange contracts	Accrued liabilities	$	299	$	2,642	$	1,711
Total		$	10,402	$	5,078	$	14,613

The following tables present the classification and amount of gains and losses, net of tax, from derivatives reported in the consolidated statements of operations:

	For the Three Months Ended June 30, 2014						For the Three Months Ended June 30, 2013						Statements of Operations  Classification
	Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations			Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations
	(In thousands)
Derivatives designated as hedging instruments
Foreign currency forward exchange contracts	$	(5,536	)	$	(2,830	)	$	(872	)	$	(326	)	Cost of sales
	For the Six Months Ended June 30, 2014						For the Six Months Ended June 30, 2013						Statements of Operations  Classification
	Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations			Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from Accumulated OCI to Statements of Operations
	(In thousands)
Derivatives designated as hedging instruments
Foreign currency forward exchange contracts	$	(4,308	)	$	(5,597	)	$	7,266		$	803		Cost of sales

The net losses of $2.8 million and $5.6 million reclassified from accumulated other comprehensive loss to the consolidated statements of operations for the three and six months ended June 30, 2014, respectively, and the net loss of $0.3 million and net gain of $0.8 million reclassified from accumulated other comprehensive loss to the consolidated statements of operations for the three and six months ended June 30, 2013, respectively, are offset by the changes in cash flows associated with the underlying hedged transactions.

	Amount of Gain (Loss) Recognized in the Statements of Operations						Statements of Operations Classification
	For the Three Months Ended June 30, 2014			For the Three Months Ended June 30, 2013
	(In thousands)
Derivatives not designated as hedging instruments
Foreign currency forward exchange contracts	$	2,216		$	(3,546	)	Non-operating income/expense
Foreign currency forward exchange contracts		(1,085	)		(372	)	Cost of sales
Total	$	1,131		$	(3,918	)
	Amount of Gain (Loss) Recognized in the Statements of Operations						Statements of Operations Classification
	For the Six Months Ended June 30, 2014			For the Six Months Ended June 30, 2013
	(In thousands)
Derivatives not designated as hedging instruments
Foreign currency forward exchange contracts	$	9,769		$	(17,321	)	Non-operating income/expense
Foreign currency forward exchange contracts		686			31		Cost of sales
Total	$	10,455		$	(17,290	)

The net gains of $1.1 million and $10.5 million recognized in the consolidated statements of operations for the three and six months ended June 30, 2014, respectively, and the net losses of $3.9 million and $17.3 million recognized in the consolidated statements of operations for the three and six months ended June 30, 2013, respectively, are offset by foreign currency transaction gains and losses on the related hedged balances.

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Income Taxes - Additional Information (Detail) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Mar. 31, 2014
Income Taxes [Line Items]
(Benefit) provision for income taxes	$ (42,696,000)	$ 5,381,000	$ (40,899,000)	$ 11,035,000
Net discrete tax benefits	40,100,000	11,200,000	36,400,000	15,200,000
Unrecognized tax benefits					44,000,000
Reasonably possible changes to unrecognized tax benefits related to settlement of tax audits and/or expiration of statutes of limitations within the next twelve months	$ 38,000,000		$ 38,000,000

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Consolidated Statements of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Net Sales	$ 1,062,252	$ 1,169,109	$ 2,008,429	$ 2,164,715
Cost of sales	569,682	569,101	1,034,328	1,024,656
Gross Profit	492,570	600,008	974,101	1,140,059
Advertising and promotion expenses	99,853	113,403	190,687	217,943
Other selling and administrative expenses	391,709	391,815	776,188	761,495
Operating Income	1,008	94,790	7,226	160,621
Interest expense	18,965	18,259	36,211	38,596
Interest (income)	(2,186)	(1,289)	(3,465)	(2,689)
Other non-operating (income) expense, net	(1,400)	(909)	(1,728)	1,820
(Loss) Income Before Income Taxes	(14,371)	78,729	(23,792)	122,894
(Benefit) provision for income taxes	(42,696)	5,381	(40,899)	11,035
Net Income	$ 28,325	$ 73,348	$ 17,107	$ 111,859
Net Income Per Common Share-Basic	$ 0.08	$ 0.21	$ 0.05	$ 0.32
Weighted average number of common shares	338,709	346,614	339,463	345,453
Net Income Per Common Share-Diluted	$ 0.08	$ 0.21	$ 0.05	$ 0.32
Weighted average number of common and potential common shares	340,644	350,424	341,594	349,503
Dividends Declared Per Common Share	$ 0.38	$ 0.36	$ 0.76	$ 0.72

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Other Noncurrent Assets

6 Months Ended

Jun. 30, 2014

Other Noncurrent Assets

6. Other Noncurrent Assets

Other noncurrent assets include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Nonamortizable identifiable intangibles	$	517,378	$	504,241	$	504,241
Deferred income taxes		424,184		439,937		373,638
Identifiable intangibles (net of amortization of $77.2 million, $68.8 million, and $68.3 million, respectively)		261,636		182,005		176,579
Other		286,791		249,796		264,603
	$	1,489,989	$	1,375,979	$	1,319,061

In connection with the acquisition of MEGA Brands, as more fully described in “Note 5 to the Consolidated Financial Statements—Goodwill” of this Quarterly Report on Form 10-Q, Mattel recognized $95.0 million of amortizable identifiable intangible assets, primarily related to trade names and existing product lines.

Mattel tests nonamortizable intangible assets, including trademarks and trade names, for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying values may exceed the fair values. Mattel also tests its amortizable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable.

During the second quarter of 2013, Mattel changed its brand strategy for Polly Pocket^®, which includes a more focused allocation of resources to support the Polly Pocket brand in specific markets, resulting in a reduction of the forecasted future cash flows of the brand. As a result of the change, Mattel tested the Polly Pocket trade name for impairment. The Polly Pocket trade name, which had a carrying value of approximately $113 million, was previously determined to be a nonamortizable intangible asset. Its fair value was determined to be approximately $99 million based on a discounted cash flow analysis using the multi-period excess earnings method. Level 3 inputs, including forecasted future cash flows, an estimated useful life, and a discount rate, were used in the valuation. As the fair value of the asset was below the carrying value, Mattel recorded an impairment charge of approximately $14 million, which was reflected within other selling and administrative expenses in the consolidated statement of operations for the North America and International operating segments during the second quarter of 2013.

In conjunction with the Polly Pocket trade name impairment test, Mattel reassessed the intangible asset’s nonamortizable classification and determined that the nonamortizable classification could no longer be supported. During the second quarter of 2013, the Polly Pocket trade name was reclassified as an amortizable intangible asset, and the remaining fair value of the asset is being amortized over its estimated remaining useful life.

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Goodwill

6 Months Ended

Jun. 30, 2014

Goodwill

5. Goodwill

Goodwill is allocated to various reporting units, which are at the operating segment level, for purposes of evaluating whether goodwill is impaired. Mattel’s reporting units are: (i) North America, (ii) International, and (iii) American Girl. Mattel tests its goodwill for impairment annually in the third quarter and whenever events or changes in circumstances indicate that the carrying value of a reporting unit may exceed its fair value.

The change in the carrying amount of goodwill by operating segment for the six months ended June 30, 2014 is shown below. Brand-specific goodwill held by foreign subsidiaries is allocated to the North America and American Girl operating segments selling those brands, thereby causing a foreign currency translation impact for these operating segments.

	December 31, 2013		Acquisition		Currency Exchange Rate Impact			June 30, 2014
	(In thousands)
North America	$	547,595	$	171,062	$	1,267		$	719,924
International		321,656		139,960		3,262			464,878
American Girl		213,988		—		(24	)		213,964
Total goodwill	$	1,083,239	$	311,022	$	4,505		$	1,398,766

Acquisition of MEGA Brands Inc.

On April 30, 2014, Mattel acquired MEGA Brands Inc., a corporation incorporated under the laws of Canada (“MEGA Brands”), pursuant to the Arrangement Agreement dated as of February 27, 2014, between MEGA Brands, Mattel Overseas Operations Ltd., a corporation incorporated under the laws of Bermuda, Mattel-MEGA Holdings Inc., a corporation incorporated under the laws of Canada (the “Purchasing Subsidiary”), and, with respect to certain provisions thereof, Mattel (the “Arrangement Agreement”). Pursuant to the terms set forth in the Arrangement Agreement, Mattel indirectly acquired, through the Purchasing Subsidiary, 100% of the issued and outstanding common shares and warrants of MEGA Brands for total cash consideration of $454.9 million, including payment for cash acquired of $31.6 million. The acquisition of MEGA Brands will build upon Mattel’s portfolio of brands by expanding into the construction building sets and arts and crafts categories.

The total purchase consideration was allocated to the assets acquired and liabilities assumed based on their estimated fair values. As a result of the acquisition, Mattel recognized $95.0 million of identifiable intangible assets (primarily related to trade names and existing product lines), $48.9 million of net assets acquired (which included $31.6 million of cash, $85.6 million of inventory, $33.6 million of property, plant, and equipment, $67.5 million of accounts payable and accrued liabilities, $44.6 million of long-term debt, and $10.2 million of other net assets), and $311.0 million of goodwill, which is not deductible for tax purposes. The fair values of the identifiable intangible assets related to trade names were based on the relief from royalty method, using Level 3 inputs within the fair value hierarchy, which included forecasted future cash flows, long-term revenue growth rates, royalty rates, and discount rates. The fair values of the identifiable intangible assets related to existing product lines were estimated based on the multi-period excess earnings method, using Level 3 inputs within the fair value hierarchy, which included forecasted future cash flows, long-term revenue growth rates, and discount rates. Goodwill relates to a number of factors built into the purchase price, including the future earnings and cash flow potential of the business, as well as the complementary strategic fit and the resulting synergies it brings to Mattel’s existing operations. Mattel is in the process of finalizing the valuation of the assets acquired and liabilities assumed. The determination of the final values of assets acquired and liabilities assumed may result in adjustments to the values presented and a corresponding adjustment to goodwill.

Additionally, during the three and six months ended June 30, 2014, Mattel recognized approximately $4 million of integration costs and approximately $7 million of transaction costs. Integration and transaction costs are recorded within other selling and administrative expenses in the consolidated statements of operations. The pro forma and actual results of operations for this acquisition have not been presented because they are not material.

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Other Selling and Administrative Expenses

6 Months Ended

Jun. 30, 2014

Other Selling and Administrative Expenses

17. Other Selling and Administrative Expenses

Other selling and administrative expenses include the following:

	For the Three Months Ended				For the Six Months Ended
	June 30, 2014		June 30, 2013		June 30, 2014		June 30, 2013
	(In thousands)
Design and development	$	51,562	$	47,411	$	101,059	$	95,384
Identifiable intangible asset amortization		7,622		2,928		10,253		5,731

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Fair Value Measurements

6 Months Ended

Jun. 30, 2014

Fair Value Measurements

13. Fair Value Measurements

The following table presents information about Mattel’s assets and liabilities measured and reported in the financial statements at fair value and indicates 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.

Mattel’s financial assets and liabilities measured and reported at fair value on a recurring basis include the following:

	June 30, 2014
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	7,802	$	—	$	7,802
Auction rate security (b)		—		—		31,312		31,312
Total assets	$	—	$	7,802	$	31,312	$	39,114
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	10,402	$	—	$	10,402
	June 30, 2013
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	7,389	$	—	$	7,389
Auction rate security (b)		—		—		23,222		23,222
Total assets	$	—	$	7,389	$	23,222	$	30,611
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	5,078	$	—	$	5,078
	December 31, 2013
	Level 1		Level 2		Level 3		Total
			(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	2,310	$	—	$	2,310
Auction rate security (b)		—		—		28,895		28,895
Total assets	$	—	$	2,310	$	28,895	$	31,205
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	14,613	$	—	$	14,613

(a) The fair value of the foreign currency forward exchange contracts is 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.

(b) The fair value of the auction rate security is estimated using a discounted cash flow model based on (i) estimated interest rates, timing, and amount of cash flows, (ii) credit spreads, recovery rates, and credit quality of the underlying securities, (iii) illiquidity considerations, and (iv) market correlation.

The following table presents information about Mattel’s auction rate security measured and reported at fair value on a recurring basis using significant Level 3 inputs:

	Level 3
	(In thousands)
Balance at December 31, 2013	$	28,895
Unrealized gain		2,417
Balance at June 30, 2014	$	31,312

Other Financial Instruments

Mattel’s financial instruments include cash and equivalents, accounts receivable and payable, short-term borrowings, and accrued liabilities. The fair values of these instruments approximate their carrying values because of their short-term nature and are classified as Level 2 within the fair value hierarchy.

The estimated fair value of Mattel’s long-term debt, including the current portion, was $2.19 billion (compared to a carrying value of $2.10 billion) as of June 30, 2014, $1.69 billion (compared to a carrying value of $1.65 billion) as of June 30, 2013, and $1.62 billion (compared to a carrying value of $1.60 billion) as of December 31, 2013. The estimated fair values have been calculated based on broker quotes or rates for the same or similar instruments and are classified as Level 2 within the fair value hierarchy.

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Segment Assets (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Segment Reporting, Asset Reconciling Item [Line Items]
Accounts receivable and inventories, net	$ 1,764,217	$ 1,828,948	$ 1,739,338
Operating Segments
Segment Reporting, Asset Reconciling Item [Line Items]
Accounts receivable and inventories, net	1,672,070	1,745,094	1,613,252
Operating Segments | North America
Segment Reporting, Asset Reconciling Item [Line Items]
Accounts receivable and inventories, net	700,968	723,886	645,334
Operating Segments | International
Segment Reporting, Asset Reconciling Item [Line Items]
Accounts receivable and inventories, net	835,707	920,770	850,907
Operating Segments | American Girl
Segment Reporting, Asset Reconciling Item [Line Items]
Accounts receivable and inventories, net	135,395	100,438	117,011
Corporate and Other
Segment Reporting, Asset Reconciling Item [Line Items]
Accounts receivable and inventories, net	$ 92,147	$ 83,854	$ 126,086

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Long-Term Debt

6 Months Ended

Jun. 30, 2014

Long-Term Debt

9. Long-Term Debt

Long-term debt includes the following:

	June 30, 2014		June 30, 2013			December 31, 2013
	(In thousands)
Medium-term notes	$	—	$	50,000		$	—
2010 Senior Notes due October 2020 and October 2040		500,000		500,000			500,000
2011 Senior Notes due November 2016 and November 2041		600,000		600,000			600,000
2013 Senior Notes due March 2018 and March 2023		500,000		500,000			500,000
2014 Senior Notes due May 2019		500,000		—			—
		2,100,000		1,650,000			1,600,000
Less: current portion		—		(50,000	)		—
Total long-term debt	$	2,100,000	$	1,600,000		$	1,600,000

In May 2014, Mattel issued $500.0 million aggregate principal amount of 2.35% senior unsecured notes due May 6, 2019 (“2014 Senior Notes”). Interest on the 2014 Senior Notes is payable semi-annually on May 6 and November 6 of each year, beginning November 6, 2014. Mattel may redeem all or part of the 2014 Senior Notes at any time or from time to time at its option, at a redemption price equal to the greater of (i) 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest to but excluding the redemption date, and (ii) a “make-whole” amount based on the yield of a comparable US Treasury security plus 12.5 basis points.

During the second quarter of 2014, Mattel repaid $44.6 million of long-term borrowings assumed through the acquisition of MEGA Brands.

During the fourth quarter of 2013, Mattel repaid $50.0 million of its Medium-term notes in connection with their scheduled maturities.

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Long Term Debt - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		1 Months Ended
	Dec. 31, 2013	Jun. 30, 2014 MEGA Brands	May 31, 2014 2014 Senior Notes due May 2019
Debt Instrument [Line Items]
Principal of debt instrument			$ 500.0
Debt instrument maturity date			May 06, 2019
Issuance date			2014-05
Interest rate			2.35%
Interest terms			Interest on the 2014 Senior Notes is payable semi-annually on May 6 and November 6 of each year, beginning November 6, 2014.
Redemption terms			Mattel may redeem all or part of the 2014 Senior Notes at any time or from time to time at its option, at a redemption price equal to the greater of (i) 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest to but excluding the redemption date, and (ii) a "make-whole" amount based on the yield of a comparable US Treasury security plus 12.5 basis points.
Redemption price option one			100.00%
Redemption price option two			0.125%
Repayment of long-term borrowings assumed		44.6
Repayment of Medium-term notes	$ 50.0

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Accrued Liabilities

6 Months Ended

Jun. 30, 2014

Accrued Liabilities

7. Accrued Liabilities

Accrued liabilities include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Royalties	$	63,366	$	55,904	$	100,542
Advertising and promotion		52,506		9,378		76,453
Taxes other than income taxes		33,530		48,492		70,121
Litigation accrual		—		137,800		—
Other		332,441		332,627		393,039
	$	481,843	$	584,201	$	640,155

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Seasonal Financing

6 Months Ended

Jun. 30, 2014

Seasonal Financing

8. Seasonal Financing

Mattel maintains and periodically amends or replaces its domestic unsecured committed revolving credit facility with a commercial bank group. The facility is used as a back-up to Mattel’s commercial paper program, which is used as the primary source of financing for the seasonal working capital requirements of its domestic subsidiaries. The agreement governing the credit facility was amended and restated on March 11, 2013 to, among other things, (i) extend the maturity date of the credit facility to March 12, 2018, (ii) increase aggregate commitments under the credit facility to $1.60 billion, with an “accordion feature,” which allows Mattel to increase the aggregate availability under the credit facility to $1.85 billion under certain circumstances, (iii) decrease the applicable interest rate margins to a range of 0.00% to 0.75% above the applicable base rate for base rate loans and 0.88% to 1.75% above the applicable LIBOR for Eurodollar rate loans, in each case depending on Mattel’s senior unsecured long-term debt rating, and (iv) decrease commitment fees to a range of 0.08% to 0.28% of the unused commitments under the credit facility.

The amended credit facility has a borrowing capacity of up to $1.60 billion over a term of five years. Prior to the amendment, the facility permitted Mattel to borrow up to $1.40 billion and had two years remaining to maturity. The proportion of unamortized debt issuance costs from the prior facility renewal related to creditors involved in both the prior facility and amended facility and borrowing costs incurred as a result of the amendment were deferred, and such costs will be amortized over the term of the amended facility.

Mattel is required to meet financial ratio covenants at the end of each quarter and fiscal year, using the formulae specified in the credit agreement to calculate the ratios. Mattel was in compliance with such covenants at June 30, 2014.

The credit agreement is a material agreement and failure to comply with the financial ratio covenants may result in an event of default under the terms of the credit facility. If Mattel were to default under the terms of the credit facility, its ability to meet its seasonal financing requirements could be adversely affected.

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Other Noncurrent Liabilities

6 Months Ended

Jun. 30, 2014

Other Noncurrent Liabilities

10. Other Noncurrent Liabilities

Other noncurrent liabilities include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Benefit plan liabilities	$	191,817	$	279,005	$	193,046
Noncurrent tax liabilities		157,639		202,441		186,055
Other		168,843		155,107		161,526
	$	518,299	$	636,553	$	540,627

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Accumulated Other Comprehensive Income (Loss) - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Comprehensive Income (Loss) [Line Items]
Currency translation adjustments	$ 33,506	$ (37,383)	$ 37,378	$ (64,762)

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Worldwide Revenues by Brand Category (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross sales	$ 1,171,130	$ 1,278,124	$ 2,212,358	$ 2,366,554
Sales adjustments	(108,878)	(109,015)	(203,929)	(201,839)
Net Sales	1,062,252	1,169,109	2,008,429	2,164,715
Mattel Girls And Boys Brands
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross sales	688,977	792,428	1,345,838	1,484,598
Fisher-Price Brands
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross sales	328,766	396,730	600,209	683,995
American Girl Brands
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross sales	83,146	78,174	189,084	178,629
Construction and Arts & Crafts Brands
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross sales	61,600		61,600
Other
Segment Reporting, Revenue Reconciling Item [Line Items]
Gross sales	$ 8,641	$ 10,792	$ 15,627	$ 19,332

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Derivative Assets and Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	$ 7,802	$ 2,310	$ 7,389
Derivative liability, fair value	10,402	14,613	5,078
Designated As Hedging Instrument
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	3,479	415	7,389
Derivative liability, fair value	10,103	12,902	2,436
Designated As Hedging Instrument | Foreign Exchange Forward | Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	2,938	415	7,389
Designated As Hedging Instrument | Foreign Exchange Forward | Other noncurrent assets
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	541
Designated As Hedging Instrument | Foreign Exchange Forward | Accrued liabilities
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	10,028	12,432	2,436
Designated As Hedging Instrument | Foreign Exchange Forward | Other noncurrent liabilities
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	75	470
Not Designated As Hedging Instrument | Foreign Exchange Forward | Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	4,323	1,895
Not Designated As Hedging Instrument | Foreign Exchange Forward | Accrued liabilities
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	$ 299	$ 1,711	$ 2,642

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Classification and Amount of Reclassifications from Accumulated Other Comprehensive Income to Consolidated Statement of Operations (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013		Jun. 30, 2014		Jun. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Cost of sales	$ (569,682)		$ (569,101)		$ (1,034,328)		$ (1,024,656)
(Loss) Income Before Income Taxes	(14,371)		78,729		(23,792)		122,894
Provision for income taxes	42,696		(5,381)		40,899		(11,035)
Net Income	28,325		73,348		17,107		111,859
Reclassification Out of Accumulated Other Comprehensive Income | Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Provision for income taxes	29		(8)		(20)		(10)
Net Income	(2,830)		(326)		(5,597)		803
Reclassification Out of Accumulated Other Comprehensive Income | Derivative Instruments | Foreign Currency Forward Exchange Contracts
Accumulated Other Comprehensive Income (Loss) [Line Items]
Cost of sales	(2,859)		(318)		(5,577)		813
Reclassification Out of Accumulated Other Comprehensive Income | Defined Benefit Pension Plans
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amortization of prior service credit	264	[1]	126	[1]	528	[1]	252	[1]
Recognized actuarial loss	(3,664)	[1]	(5,146)	[1]	(7,326)	[1]	(10,292)	[1]
(Loss) Income Before Income Taxes	(3,400)		(5,020)		(6,798)		(10,040)
Provision for income taxes	1,207		1,900		2,425		3,800
Net Income	$ (2,193)		$ (3,120)		$ (4,373)		$ (6,240)

[1] 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" of this Quarterly Report on Form 10-Q for additional information regarding Mattel's net periodic benefit cost.

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Other Noncurrent Assets (Tables)

6 Months Ended

Jun. 30, 2014

Other Noncurrent Assets

Other noncurrent assets include the following:

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Nonamortizable identifiable intangibles	$	517,378	$	504,241	$	504,241
Deferred income taxes		424,184		439,937		373,638
Identifiable intangibles (net of amortization of $77.2 million, $68.8 million, and $68.3 million, respectively)		261,636		182,005		176,579
Other		286,791		249,796		264,603
	$	1,489,989	$	1,375,979	$	1,319,061

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Goodwill (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Goodwill [Line Items]
Goodwill, beginning balance	$ 1,083,239	$ 1,072,084
Acquisition	311,022
Currency Exchange Rate Impact	4,505
Goodwill, ending balance	1,398,766	1,072,084
North America
Goodwill [Line Items]
Goodwill, beginning balance	547,595
Acquisition	171,062
Currency Exchange Rate Impact	1,267
Goodwill, ending balance	719,924
International
Goodwill [Line Items]
Goodwill, beginning balance	321,656
Acquisition	139,960
Currency Exchange Rate Impact	3,262
Goodwill, ending balance	464,878
American Girl
Goodwill [Line Items]
Goodwill, beginning balance	213,988
Currency Exchange Rate Impact	(24)
Goodwill, ending balance	$ 213,964

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Employee Benefit Plans

6 Months Ended

Jun. 30, 2014

Employee Benefit Plans

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 “Note 4 to the Consolidated Financial Statements–Employee Benefit Plans” in its 2013 Annual Report on Form 10-K.

A summary of the components of net periodic benefit cost for Mattel’s defined benefit pension plans is as follows:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Service cost	$	2,715		$	3,789		$	5,312		$	7,688
Interest cost		6,978			6,635			13,919			13,265
Expected return on plan assets		(8,020	)		(7,329	)		(16,023	)		(14,658	)
Amortization of prior service credit		(264	)		(126	)		(528	)		(252	)
Recognized actuarial loss		3,589			5,106			7,176			10,212
	$	4,998		$	8,075		$	9,856		$	16,255
A summary of the components of net periodic benefit cost for Mattel’s postretirement benefit plans is as follows:
	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Service cost	$	20		$	22		$	40		$	44
Interest cost		452			338			904			676
Recognized actuarial loss		75			40			150			80
	$	547		$	400		$	1,094		$	800

During the six months ended June 30, 2014, Mattel made cash contributions totaling approximately $7 million and $1 million to its defined benefit pension and postretirement benefit plans, respectively.

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Contingencies

6 Months Ended

Jun. 30, 2014

Contingencies

20. Contingencies

Litigation Related to Carter Bryant and MGA Entertainment, Inc.

In April 2004, Mattel filed a lawsuit in Los Angeles County Superior Court against Carter Bryant (“Bryant”), a former Mattel design employee. The suit alleges that Bryant aided and assisted a Mattel competitor, MGA Entertainment, Inc. (“MGA”), during the time he was employed by Mattel, in violation of his contractual and other duties to Mattel. In September 2004, Bryant asserted counterclaims against Mattel, including counterclaims in which Bryant sought, as a putative class action representative, to invalidate Mattel’s Confidential Information and Proprietary Inventions Agreements with its employees. Bryant also removed Mattel’s suit to the United States District Court for the Central District of California. In December 2004, MGA intervened as a party-defendant in Mattel’s action against Bryant, asserting that its rights to Bratz properties are at stake in the litigation.

Separately, in November 2004, Bryant filed an action against Mattel in the United States District Court for the Central District of California. The action sought a judicial declaration that Bryant’s purported conveyance of rights in Bratz was proper and that he did not misappropriate Mattel property in creating Bratz.

In April 2005, MGA filed suit against Mattel in the United States District Court for the Central District of California. MGA’s action alleges claims of trade dress infringement, trade dress dilution, false designation of origin, unfair competition, and unjust enrichment. The suit alleges, among other things, that certain products, themes, packaging, and/or television commercials in various Mattel product lines have infringed upon products, themes, packaging, and/or television commercials for various MGA product lines, including Bratz. The complaint also asserts that various alleged Mattel acts with respect to unidentified retailers, distributors, and licensees have damaged MGA and that various alleged acts by industry organizations, purportedly induced by Mattel, have damaged MGA. MGA’s suit alleges that MGA has been damaged in an amount “believed to reach or exceed tens of millions of dollars” and further seeks punitive damages, disgorgement of Mattel’s profits and injunctive relief.

In June 2006, the three cases were consolidated in the United States District Court for the Central District of California. On July 17, 2006, the Court issued an order dismissing all claims that Bryant had asserted against Mattel, including Bryant’s purported counterclaims to invalidate Mattel’s Confidential Information and Proprietary Inventions Agreements with its employees, and Bryant’s claims for declaratory relief.

In November 2006, Mattel asked the Court for leave to file an Amended Complaint that included not only additional claims against Bryant, but also included claims for copyright infringement, Racketeer Influenced and Corrupt Organizations (“RICO”) violations, misappropriation of trade secrets, intentional interference with contract, aiding and abetting breach of fiduciary duty and breach of duty of loyalty, and unfair competition, among others, against MGA, its Chief Executive Officer Isaac Larian, certain MGA affiliates and an MGA employee. The RICO claim alleged that MGA stole Bratz and then, by recruiting and hiring key Mattel employees and directing them to bring with them Mattel confidential and proprietary information, unfairly competed against Mattel using Mattel’s trade secrets, confidential information, and key employees to build their business. On January 12, 2007, the Court granted Mattel leave to file these claims as counterclaims in the consolidated cases, which Mattel did that same day.

Mattel sought to try all of its claims in a single trial, but in February 2007, the Court decided that the consolidated cases would be tried in two phases, with the first trial to determine claims and defenses related to Mattel’s ownership of Bratz works and whether MGA infringed those works. On May 19, 2008, Bryant reached a settlement agreement with Mattel and is no longer a defendant in the litigation. In the public stipulation entered by Mattel and Bryant in connection with the resolution, Bryant agreed that he was and would continue to be bound by all prior and future Court Orders relating to Bratz ownership and infringement, including the Court’s summary judgment rulings.

The first phase of the first trial, which began on May 27, 2008, resulted in a unanimous jury verdict on July 17, 2008 in favor of Mattel. The jury found that almost all of the Bratz design drawings and other works in question were created by Bryant while he was employed at Mattel; that MGA and Isaac Larian intentionally interfered with the contractual duties owed by Bryant to Mattel, aided and abetted Bryant’s breaches of his duty of loyalty to Mattel, aided and abetted Bryant’s breaches of the fiduciary duties he owed to Mattel, and converted Mattel property for their own use. The same jury determined that defendants MGA, Larian, and MGA Entertainment (HK) Limited infringed Mattel’s copyrights in the Bratz design drawings and other Bratz works, and awarded Mattel total damages of approximately $100 million against the defendants. On December 3, 2008, the Court issued a series of orders rejecting MGA’s equitable defenses and granting Mattel’s motions for equitable relief, including an order enjoining the MGA party defendants from manufacturing, marketing, or selling certain Bratz fashion dolls or from using the “Bratz” name. The Court stayed the effect of the December 3, 2008 injunctive orders until further order of the Court and entered a further specified stay of the injunctive orders on January 7, 2009.

The parties filed and argued additional motions for post-trial relief, including a request by MGA to enter judgment as a matter of law on Mattel’s claims in MGA’s favor and to reduce the jury’s damages award to Mattel. Mattel additionally moved for the appointment of a receiver. On April 27, 2009, the Court entered an order confirming that Bratz works found by the jury to have been created by Bryant during his Mattel employment were Mattel’s property and that hundreds of Bratz female fashion dolls infringe Mattel’s copyrights. The Court also upheld the jury’s award of damages in the amount of $100 million and ordered an accounting of post-trial Bratz sales. The Court further vacated the stay of the December 3, 2008 orders, except to the extent specified by the Court’s January 7, 2009 modification.

MGA appealed the Court’s equitable orders to the Court of Appeals for the Ninth Circuit. On December 9, 2009, the Ninth Circuit heard oral argument on MGA’s appeal and issued an order staying the District Court’s equitable orders pending a further order to be issued by the Ninth Circuit. The Ninth Circuit opinion vacating the relief ordered by the District Court was issued on July 22, 2010. The Ninth Circuit stated that, because of several jury instruction errors it identified, a significant portion—if not all—of the jury verdict and damage award should be vacated.

In its opinion, the Ninth Circuit found that the District Court erred in concluding that Mattel’s Invention Agreement unambiguously applied to “ideas;” that it should have considered extrinsic evidence in determining the application of the agreement; and if the conclusion turns on conflicting evidence, it should have been up to the jury to decide. The Ninth Circuit also concluded that the District Judge erred in transferring the entire brand to Mattel based on misappropriated names and that the Court should have submitted to the jury, rather than deciding itself, whether Bryant’s agreement assigned works created outside the scope of his employment and whether Bryant’s creation of the Bratz designs and sculpt was outside of his employment. The Court then went on to address copyright issues which would be raised after a retrial, since Mattel “might well convince a properly instructed jury” that it owns Bryant’s designs and sculpt. The Ninth Circuit stated that the sculpt itself was entitled only to “thin” copyright protection against virtually identical works, while the Bratz sketches were entitled to “broad” protection against substantially similar works; in applying the broad protection, however, the Ninth Circuit found that the lower court had erred in failing to filter out all of the unprotectable elements of Bryant’s sketches. This mistake, the Court said, caused the lower court to conclude that all Bratz dolls were substantially similar to Bryant’s original sketches.

Judge Stephen Larson, who presided over the first trial, retired from the bench during the course of the appeal, and the case was transferred to Judge David O. Carter. After the transfer, Judge Carter granted Mattel leave to file a Fourth Amended Answer and Counterclaims which focused on RICO, trade secret and other claims, and added additional parties, and subsequently granted in part and denied in part a defense motion to dismiss those counterclaims.

Later, on August 16, 2010, MGA asserted several new claims against Mattel in response to Mattel’s Fourth Amended Answer and Counterclaims, including claims for alleged trade secret misappropriation, an alleged violation of RICO, and wrongful injunction. Mattel moved to strike and/or dismiss these claims, as well as certain MGA allegations regarding Mattel’s motives for filing suit. The Court granted that motion as to the wrongful injunction claim, which it dismissed with prejudice, and as to the allegations about Mattel’s motives, which it struck. The Court denied the motion as to MGA’s trade secret misappropriation claim and its claim for violations of RICO.

The Court resolved summary judgment motions in late 2010. Among other rulings, the Court dismissed both parties’ RICO claims; dismissed Mattel’s claim for breach of fiduciary duty and portions of other claims as “preempted” by the trade secrets act; dismissed MGA’s trade dress infringement claims; dismissed MGA’s unjust enrichment claim; dismissed MGA’s common law unfair competition claim; and dismissed portions of Mattel’s copyright infringement claim as to “later generation” Bratz dolls.

Trial of all remaining claims began in early January 2011. During the trial, and before the case was submitted to the jury, the Court granted MGA’s motions for judgment as to Mattel’s claims for aiding and abetting breach of duty of loyalty and conversion. The Court also granted a defense motion for judgment on portions of Mattel’s claim for misappropriation of trade secrets relating to thefts by former Mattel employees located in Mexico.

The jury reached verdicts on the remaining claims in April 2011. In those verdicts, the jury ruled against Mattel on its claims for ownership of Bratz-related works, for copyright infringement, and for misappropriation of trade secrets. The jury ruled for MGA on its claim of trade secret misappropriation as to 26 of its claimed trade secrets and awarded $88.5 million in damages. The jury ruled against MGA as to 88 of its claimed trade secrets. The jury found that Mattel’s misappropriation was willful and malicious.

In early August 2011, the Court ruled on post-trial motions. The Court rejected MGA’s unfair competition claims and also rejected Mattel’s equitable defenses to MGA’s misappropriation of trade secrets claim. The Court reduced the jury’s damages award of $88.5 million to $85.0 million. The Court awarded MGA an additional $85.0 million in punitive damages and approximately $140 million in attorney’s fees and costs. The Court entered a judgment which totaled approximately $310 million in favor of MGA.

On August 11, 2011, Mattel appealed the judgment, challenging on appeal the entirety of the District Court’s monetary award in favor of MGA, including both the award of $170 million in damages for alleged trade secret misappropriation and approximately $140 million in attorney’s fees and costs. On January 24, 2013, the Ninth Circuit Court of Appeals issued a ruling on Mattel’s appeal. In that ruling, the Court found that MGA’s claim for trade secrets misappropriation was not compulsory to any Mattel claim and could not be filed as a counterclaim-in-reply. Accordingly, the Court of Appeals vacated the portion of the judgment awarding damages and attorney’s fees and costs to MGA for prevailing on its trade secrets misappropriation claim, totaling approximately $172.5 million. It ruled that, on remand, the District Court must dismiss MGA’s trade secret claim without prejudice. In its ruling, the Court of Appeals also affirmed the District Court’s award of attorney’s fees and costs under the Copyright Act. Accordingly, Mattel recorded a litigation accrual of approximately $138 million during the fourth quarter of 2012 to cover these fees and costs.

Because multiple claimants asserted rights to the attorney’s fees portion of the judgment, on February 13, 2013, Mattel filed a motion in the district court for orders permitting Mattel to interplead the proceeds of the judgment and releasing Mattel from liability to any claimant based on Mattel’s payment of the judgment.

On February 27, 2013, MGA filed a motion for leave to amend its prior complaint in the existing federal court lawsuit so that it could reassert its trade-secrets claim. Mattel opposed that motion. On December 17, 2013, the district court denied MGA’s motion for leave to amend and entered an order dismissing MGA’s trade-secrets claim without prejudice. Also on December 17, 2013, following a settlement between MGA and certain insurance carriers, the district court denied Mattel’s motion for leave to interplead the proceeds of the judgment.

On December 21, 2013, a stipulation regarding settlement with insurers and payment of judgment was filed in the district court, which provided that (i) Mattel would pay approximately $138 million, including accrued interest, in full satisfaction of the copyright fees judgment, (ii) all parties would consent to entry of an order exonerating and discharging the appeal bond posted by Mattel, and (iii) MGA’s insurers would dismiss all pending actions related to the proceeds of the copyright fees judgment, including an appeal by Evanston Insurance Company in an action against Mattel that was pending in the Ninth Circuit. On December 23, 2013, Mattel paid the copyright fees judgment in the total sum, including interest, of approximately $138 million. On December 26, 2013, the court entered an order exonerating and discharging the appeal bond posted by Mattel, and on December 27, 2013, MGA filed an acknowledgment of satisfaction of judgment. On December 30, 2013, Evanston Insurance Company’s appeal in its action against Mattel was dismissed.

On January 13, 2014, MGA filed a new, but virtually identical, trade-secrets claim against Mattel in Los Angeles County Superior Court. Mattel was served with the complaint on January 23, 2014. In its complaint, MGA purports to seek damages in excess of $1 billion. Mattel believes that MGA’s claim should be barred as a matter of law, and intends to vigorously defend against it. Accordingly, Mattel believes that the risk that Mattel will incur a loss on this claim is remote, and therefore, a liability has not been accrued as of June 30, 2014.

Litigation Related to Yellowstone do Brasil Ltda.

Yellowstone do Brasil Ltda. (formerly known as Trebbor Informática Ltda.) was a customer of Mattel’s subsidiary Mattel do Brasil Ltda. when a commercial dispute arose between Yellowstone and Mattel do Brasil regarding the supply of product and related payment terms. As a consequence of the dispute, in April 1999, Yellowstone filed a declarative action against Mattel do Brasil requesting the annulment of its security bonds and promissory notes given to Mattel as well as requesting the court to find Mattel do Brasil liable for damages incurred as a result of Mattel do Brasil’s alleged abrupt and unreasonable breach of an oral exclusive distribution agreement between the parties relating to the supply and sale of toys in Brazil. Yellowstone’s complaint sought alleged loss of profits of approximately $1 million (historical value), plus an unspecified amount of damages consisting of: (i) compensation for all investments made by Yellowstone to develop Mattel do Brasil’s business; (ii) reimbursement of the amounts paid by Yellowstone to terminate labor and civil contracts in connection with the business; (iii) compensation for alleged unfair competition and for the goodwill of trade; and (iv) compensation for non-pecuniary damages.

Mattel do Brasil filed its defenses to these claims and simultaneously presented a counterclaim for unpaid accounts receivable for goods supplied to Yellowstone in the approximate amount of $4 million (historical value).

During the evidentiary phase a first accounting report was submitted by a court-appointed expert. Such report stated that Yellowstone had invested approximately $3 million in its business (historical value). Additionally, the court-appointed expert calculated a loss of profits compensation of approximately $1 million (historical value). Mattel do Brasil challenged the report since it was not made based on the official accounting documents of Yellowstone and since the report calculated damages based only on documents unilaterally submitted by Yellowstone.

The trial court accepted the challenge and ruled that a second accounting examination should take place in the lawsuit. Yellowstone appealed the decision but it was upheld by the appeals court.

The second court-appointed expert’s report submitted at trial did not assign a value to any of Yellowstone’s claims and found no evidence of causation between Mattel do Brasil’s actions and such claims.

In January 2010, the trial court ruled in favor of Mattel do Brasil and denied all of Yellowstone’s claims based primarily on the lack of any causal connection between the acts of Mattel do Brasil and Yellowstone’s alleged damages. Additionally, the court upheld Mattel do Brasil’s counterclaim and ordered Yellowstone to pay Mattel do Brasil approximately $4 million (historical value). The likelihood of Mattel do Brasil recovering this amount was uncertain due to the fact that Yellowstone was declared insolvent and filed for bankruptcy protection. In February 2010, Yellowstone filed a motion seeking clarification of the decision which was denied.

In September 2010, Yellowstone filed a further appeal. Under Brazilian law, the appeal was de novo and Yellowstone restated all of the arguments it made at the trial court level. Yellowstone did not provide any additional information supporting its unspecified alleged damages. The appeals court held hearings on the appeal in March and April 2013. On July 26, 2013, the appeals court awarded Yellowstone approximately $17 million in damages, as adjusted for inflation and interest. The appeals court also awarded Mattel approximately $8 million on its counterclaim, as adjusted for inflation. On August 2, 2013, Mattel filed a motion for clarification since the written decision contained clear errors in terms of amounts awarded and interest and inflation adjustments. Mattel’s motion also asked the court to decide whether Yellowstone’s award could be offset by the counterclaim award, despite Yellowstone’s status as a bankrupt entity. Yellowstone also filed a motion for clarification on August 5, 2013. A decision on the clarification motions is expected in the third quarter of 2014. Mattel intends to appeal the appeals court decision to the Superior Court based on both procedural and substantive grounds.

Mattel believes that it is reasonably possible that a loss in this matter could range from $0 to approximately $22 million. The high end of this range, approximately $22 million, is based on the calculation of the current amount of the damages and loss of profits, including interest and inflation adjustments, reported in the first court-appointed examination report submitted in the lawsuit, plus attorney’s fees. Mattel do Brasil may be entitled to offset its counterclaim award of approximately $9 million, current amount including inflation adjustment, against such loss. The existence of pending motions for clarification filed by both parties and the resulting clarification decision expected to be issued in the third quarter of 2014, as well as the procedural aspects of an appeal to the Superior Court, adds some uncertainty to the final outcome of the matter. Mattel is awaiting the outcome of the clarification decision before it files an appeal with the Superior Court. Mattel believes, however, that it has valid legal grounds for appeal of the appeals court decision and does not believe that a loss is probable for this matter. Accordingly, a liability has not been accrued as of June 30, 2014. Mattel may be required by the trial court to place a bond or the full amount of the damage award in escrow pending an appeal decision by the Superior Court.

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Property, Plant, and Equipment (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	$ 2,347,573	$ 2,239,550	$ 2,206,393
Less: accumulated depreciation	(1,643,140)	(1,580,217)	(1,585,225)
Property, plant, and equipment, net	704,433	659,333	621,168
Land
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	27,666	27,555	26,605
Buildings
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	272,169	269,874	268,985
Machinery and equipment
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	709,002	673,546	680,861
Software
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	317,388	301,284	275,626
Tools, dies, and molds
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	763,490	713,749	709,723
Capital leases
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	23,921	23,271	23,271
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	$ 233,937	$ 230,271	$ 221,322

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2014

Earnings Per Share

The following table reconciles earnings per common share for the three and six months ended June 30, 2014 and 2013:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands, except per share amounts)
Basic:
Net income	$	28,325		$	73,348		$	17,107		$	111,859
Less: net income allocable to participating RSUs (a)		(265	)		(725	)		(199	)		(1,131	)
Net income available for basic common shares	$	28,060		$	72,623		$	16,908		$	110,728
Weighted average common shares outstanding		338,709			346,614			339,463			345,453
Basic net income per common share	$	0.08		$	0.21		$	0.05		$	0.32
Diluted:
Net income	$	28,325		$	73,348		$	17,107		$	111,859
Less: net income allocable to participating RSUs (a)		(270	)		(730	)		(212	)		(1,147	)
Net income available for diluted common shares	$	28,055		$	72,618		$	16,895		$	110,712
Weighted average common shares outstanding		338,709			346,614			339,463			345,453
Weighted average common equivalent shares arising from:
Dilutive stock options and non-participating RSUs		1,935			3,810			2,131			4,050
Weighted average number of common and potential common shares		340,644			350,424			341,594			349,503
Diluted net income per common share	$	0.08		$	0.21		$	0.05		$	0.32

(a) During the three and six months ended June 30, 2014 and 2013, Mattel allocated a proportionate share of both dividends and undistributed earnings to participating RSUs.

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Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Net Income	$ 28,325	$ 73,348	$ 17,107	$ 111,859
Other Comprehensive Income (Loss), Net of Tax:
Currency translation adjustments	33,506	(37,383)	37,378	(64,762)
Defined benefit pension plans net prior service credit and net actuarial loss	2,657	3,434	4,745	6,865
Net unrealized (losses) gains on derivative instruments:
Unrealized holding (losses) gains	(5,536)	(872)	(4,308)	7,266
Reclassification adjustment for realized losses (gains) included in net income	2,830	326	5,597	(803)
Net unrealized (losses) gains on derivative instruments	(2,706)	(546)	1,289	6,463
Other Comprehensive Income (Loss), Net of Tax	33,457	(34,495)	43,412	(51,434)
Comprehensive Income	$ 61,782	$ 38,853	$ 60,519	$ 60,425

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Property, Plant, and Equipment

6 Months Ended

Jun. 30, 2014

Property, Plant, and Equipment

4. Property, Plant, and Equipment

Property, plant, and equipment, net includes the following:

	June 30, 2014			June 30, 2013			December 31, 2013
	(In thousands)
Land	$	27,666		$	26,605		$	27,555
Buildings		272,169			268,985			269,874
Machinery and equipment		709,002			680,861			673,546
Software		317,388			275,626			301,284
Tools, dies, and molds		763,490			709,723			713,749
Capital leases		23,921			23,271			23,271
Leasehold improvements		233,937			221,322			230,271
		2,347,573			2,206,393			2,239,550
Less: accumulated depreciation		(1,643,140	)		(1,585,225	)		(1,580,217	)
	$	704,433		$	621,168		$	659,333

Property, plant, and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over estimated useful lives of 10 to 30 years for buildings, 3 to 10 years for machinery and equipment, 3 to 7 years for software, and 10 to 20 years, not to exceed the lease term, for leasehold improvements. Tools, dies, and molds are depreciated using the straight-line method over 3 years. Estimated useful lives are periodically reviewed and, where appropriate, changes are made prospectively. The carrying value of property, plant, and equipment is reviewed when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Any potential impairment identified is assessed by evaluating the operating performance and future undiscounted cash flows of the underlying assets. When property is sold or retired, the cost of the property and the related accumulated depreciation are removed from the consolidated balance sheet, and any resulting gain or loss is included in the results of operations.

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Long-Term Debt (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Debt Instrument [Line Items]
Long-term debt	$ 2,100,000	$ 1,600,000	$ 1,650,000
Less: current portion			(50,000)
Total long-term debt	2,100,000	1,600,000	1,600,000
Medium-term notes
Debt Instrument [Line Items]
Long-term debt			50,000
2010 Senior Notes
Debt Instrument [Line Items]
Long-term debt	500,000	500,000	500,000
2011 Senior Notes
Debt Instrument [Line Items]
Long-term debt	600,000	600,000	600,000
2013 Senior Notes
Debt Instrument [Line Items]
Long-term debt	500,000	500,000	500,000
2014 Senior Notes
Debt Instrument [Line Items]
Long-term debt	$ 500,000

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Segment Revenues and Segment Income (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2014		Jun. 30, 2013		Jun. 30, 2014		Jun. 30, 2013
Segment Reporting Information [Line Items]
Gross sales	$ 1,171,130		$ 1,278,124		$ 2,212,358		$ 2,366,554
Sales adjustments	(108,878)		(109,015)		(203,929)		(201,839)
Net Sales	1,062,252		1,169,109		2,008,429		2,164,715
Operating income	1,008		94,790		7,226		160,621
Interest expense	18,965		18,259		36,211		38,596
Interest (income)	(2,186)		(1,289)		(3,465)		(2,689)
Other non-operating (income) expense, net	(1,400)		(909)		(1,728)		1,820
(Loss) Income before income taxes	(14,371)		78,729		(23,792)		122,894
Operating Segments
Segment Reporting Information [Line Items]
Gross sales	1,171,130		1,278,124		2,212,358		2,366,554
Operating income	69,088		156,274		158,535		298,351
Operating Segments | North America
Segment Reporting Information [Line Items]
Gross sales	513,463		566,471		954,894		1,022,940
Operating income	39,497		83,966		88,220		152,093
Operating Segments | International
Segment Reporting Information [Line Items]
Gross sales	569,936		627,896		1,059,175		1,154,907
Operating income	30,854		77,100		62,334		139,095
Operating Segments | American Girl
Segment Reporting Information [Line Items]
Gross sales	87,731		83,757		198,289		188,707
Operating income	(1,263)		(4,792)		7,981		7,163
Corporate and Other
Segment Reporting Information [Line Items]
Operating income	$ (68,080)	[1]	$ (61,484)	[1]	$ (151,309)	[1]	$ (137,730)	[1]

[1] Corporate and other expense includes severance and other termination-related costs of $12.6 million and $34.1 million for the three and six months ended June 30, 2014, respectively, and $8.0 million and $13.5 million for the three and six months ended June 30, 2013, respectively, and share-based compensation expense of $11.8 million and $24.5 million for the three and six months ended June 30, 2014, respectively, and $13.7 million and $27.6 million for the three and six months ended June 30, 2013, respectively.

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Financial Assets and Liabilities Measured and Reported at Fair Value on Recurring Basis (Detail) (Fair Value, Measurements, Recurring, USD $) In Thousands, unless otherwise specified	Jun. 30, 2014		Dec. 31, 2013		Jun. 30, 2013
Assets:
Foreign currency forward exchange contracts	$ 7,802	[1]	$ 2,310	[1]	$ 7,389	[1]
Auction rate security	31,312	[2]	28,895	[2]	23,222	[2]
Total assets	39,114		31,205		30,611
Liabilities:
Foreign currency forward exchange contracts	10,402	[1]	14,613	[1]	5,078	[1]
Level 2
Assets:
Foreign currency forward exchange contracts	7,802	[1]	2,310	[1]	7,389	[1]
Total assets	7,802		2,310		7,389
Liabilities:
Foreign currency forward exchange contracts	10,402	[1]	14,613	[1]	5,078	[1]
Level 3
Assets:
Auction rate security	31,312	[2]	28,895	[2]	23,222	[2]
Total assets	$ 31,312		$ 28,895		$ 23,222

[1] The fair value of the foreign currency forward exchange contracts is 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.

[2] The fair value of the auction rate security is estimated using a discounted cash flow model based on (i) estimated interest rates, timing, and amount of cash flows, (ii) credit spreads, recovery rates, and credit quality of the underlying securities, (iii) illiquidity considerations, and (iv) market correlation.

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Segment Information

6 Months Ended

Jun. 30, 2014

Segment Information

21. Segment Information

Mattel, through its subsidiaries, sells a broad variety of toy products which are grouped into four major brand categories, including the introduction of the Construction and Arts & Crafts brand category in the second quarter of 2014:

Mattel Girls & Boys Brands—including Barbie^® fashion dolls and accessories (“Barbie”), Monster High^®, Disney Classics^®, Ever After High^®, Little Mommy^®, and Polly Pocket (collectively “Other Girls”), Hot Wheels^® and Matchbox^® vehicles and play sets (collectively “Wheels”), and CARS^®, Disney Planes™, Radica^®, Toy Story^®, Max Steel^®, WWE^® Wrestling, Batman^®, and games and puzzles (collectively “Entertainment”).

Fisher-Price Brands—including Fisher-Price^®, Little People^®, BabyGear™, Laugh & Learn^®, and Imaginext^® (collectively “Core Fisher-Price”), Thomas & Friends^®, Dora the Explorer^®, Mickey Mouse^® Clubhouse, and Disney Jake and the Never Land Pirates^® (collectively “Fisher-Price Friends”), and Power Wheels^®.

American Girl Brands—including My American Girl^®, the historical collection, and Bitty Baby^®. American Girl Brands products are sold directly to consumers via its catalog, website, and proprietary retail stores. Its children’s publications are also sold to certain retailers.

Construction and Arts & Crafts Brands—including MEGA BLOKS^®, RoseArt^®, and Board Dudes^®.

Mattel’s operating segments are: (i) North America, which consists of the US and Canada, (ii) International, and (iii) American Girl. The North America and International segments sell products in the Mattel Girls & Boys Brands, Fisher-Price Brands, and Construction and Arts & Crafts Brands categories, although some are developed and adapted for particular international markets.

Segment Data

The following tables present information about revenues, income, and assets by segment. Mattel does not include sales adjustments such as trade discounts and other allowances in the calculation of segment revenues (referred to as “gross sales” and reconciled to net sales in Part I, Item 2 “Non-GAAP Financial Measure” of this Quarterly Report on Form 10-Q). Mattel records these adjustments in its financial accounting systems at the time of sale to each customer, but the adjustments are not allocated to individual products. For this reason, Mattel’s chief operating decision maker uses gross sales by segment as one of the metrics to measure segment performance. Such sales adjustments are included in the determination of segment income from operations based on the adjustments recorded in the financial accounting systems. Segment income represents each segment’s operating income, while consolidated operating income represents income from operations before net interest, other non-operating (income) expense, and income taxes as reported in the consolidated statements of operations. The corporate and other expense category includes costs not allocated to individual segments, including charges related to incentive compensation, share-based payments, and corporate headquarters functions managed on a worldwide basis, and the impact of changes in foreign currency rates on intercompany transactions.

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Revenues by Segment
North America	$	513,463		$	566,471		$	954,894		$	1,022,940
International		569,936			627,896			1,059,175			1,154,907
American Girl		87,731			83,757			198,289			188,707
Gross sales		1,171,130			1,278,124			2,212,358			2,366,554
Sales adjustments		(108,878	)		(109,015	)		(203,929	)		(201,839	)
Net sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715
Segment Income (Loss)
North America	$	39,497		$	83,966		$	88,220		$	152,093
International		30,854			77,100			62,334			139,095
American Girl		(1,263	)		(4,792	)		7,981			7,163
		69,088			156,274			158,535			298,351
Corporate and other expense (a)		(68,080	)		(61,484	)		(151,309	)		(137,730	)
Operating income		1,008			94,790			7,226			160,621
Interest expense		18,965			18,259			36,211			38,596
Interest (income)		(2,186	)		(1,289	)		(3,465	)		(2,689	)
Other non-operating (income) expense, net		(1,400	)		(909	)		(1,728	)		1,820
(Loss) Income before income taxes	$	(14,371	)	$	78,729		$	(23,792	)	$	122,894

(a) Corporate and other expense includes severance and other termination-related costs of $12.6 million and $34.1 million for the three and six months ended June 30, 2014, respectively, and $8.0 million and $13.5 million for the three and six months ended June 30, 2013, respectively, and share-based compensation expense of $11.8 million and $24.5 million for the three and six months ended June 30, 2014, respectively, and $13.7 million and $27.6 million for the three and six months ended June 30, 2013, respectively.

Segment assets are comprised of accounts receivable and inventories, net of applicable reserves and allowances.

	June 30, 2014		June 30, 2013		December 31, 2013
	(In thousands)
Assets by Segment
North America	$	700,968	$	645,334	$	723,886
International		835,707		850,907		920,770
American Girl		135,395		117,011		100,438
		1,672,070		1,613,252		1,745,094
Corporate and other		92,147		126,086		83,854
Accounts receivable and inventories, net	$	1,764,217	$	1,739,338	$	1,828,948

The table below presents worldwide revenues by brand category:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands)
Worldwide Revenues by Brand Category
Mattel Girls & Boys Brands	$	688,977		$	792,428		$	1,345,838		$	1,484,598
Fisher-Price Brands		328,766			396,730			600,209			683,995
American Girl Brands		83,146			78,174			189,084			178,629
Construction and Arts & Crafts Brands		61,600			—			61,600			—
Other		8,641			10,792			15,627			19,332
Gross sales		1,171,130			1,278,124			2,212,358			2,366,554
Sales adjustments		(108,878	)		(109,015	)		(203,929	)		(201,839	)
Net sales	$	1,062,252		$	1,169,109		$	2,008,429		$	2,164,715

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Components of Net Periodic Benefit Cost (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Defined benefit pension plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 2,715	$ 3,789	$ 5,312	$ 7,688
Interest cost	6,978	6,635	13,919	13,265
Expected return on plan assets	(8,020)	(7,329)	(16,023)	(14,658)
Amortization of prior service credit	(264)	(126)	(528)	(252)
Recognized actuarial loss	3,589	5,106	7,176	10,212
Net periodic benefit cost	4,998	8,075	9,856	16,255
Postretirement benefit plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	20	22	40	44
Interest cost	452	338	904	676
Recognized actuarial loss	75	40	150	80
Net periodic benefit cost	$ 547	$ 400	$ 1,094	$ 800

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Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2014

Summary of Changes in Accumulated Other Comprehensive Income/Loss

The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income (loss):

	For the Three Months Ended June 30, 2014
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2014	$	(6,794	)	$	(129,858	)	$	(297,069	)	$	(433,721	)
Other comprehensive (loss) income before reclassifications		(5,536	)		464			33,506			28,434
Amounts reclassified from accumulated other comprehensive income (loss)		2,830			2,193			—			5,023
Net (decrease) increase in other comprehensive income		(2,706	)		2,657			33,506			33,457
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2014	$	(9,500	)	$	(127,201	)	$	(263,563	)	$	(400,264	)
	For the Six Months Ended June 30, 2014
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2013	$	(10,789	)	$	(131,946	)	$	(300,941	)	$	(443,676	)
Other comprehensive (loss) income before reclassifications		(4,308	)		372			37,378			33,442
Amounts reclassified from accumulated other comprehensive income (loss)		5,597			4,373			—			9,970
Net increase in other comprehensive income		1,289			4,745			37,378			43,412
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2014	$	(9,500	)	$	(127,201	)	$	(263,563	)	$	(400,264	)
	For the Three Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2013	$	4,426		$	(187,225	)	$	(298,626	)	$	(481,425	)
Other comprehensive (loss) income before reclassifications		(872	)		314			(37,383	)		(37,941	)
Amounts reclassified from accumulated other comprehensive income (loss)		326			3,120			—			3,446
Net (decrease) increase in other comprehensive income		(546	)		3,434			(37,383	)		(34,495	)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)
	For the Six Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2012	$	(2,583	)	$	(190,656	)	$	(271,247	)	$	(464,486	)
Other comprehensive income (loss) before reclassifications		7,266			625			(64,762	)		(56,871	)
Amounts reclassified from accumulated other comprehensive income (loss)		(803	)		6,240			—			5,437
Net increase (decrease) in other comprehensive income		6,463			6,865			(64,762	)		(51,434	)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)

Summary of Consolidated Statement of Operations Line Items Affected by Reclassifications from Accumulated Other Comprehensive Income/Loss

The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statement of operations:

	For the Three Months Ended June 30, 2014			For the Three Months Ended June 30, 2013			Statements of Operations Classification
	(In thousands)
Derivative Instruments
Loss on foreign currency forward exchange contracts	$	(2,859	)	$	(318	)	Cost of sales
		29			(8	)	Provision for income taxes
	$	(2,830	)	$	(326	)	Net income
Defined Benefit Pension Plans
Amortization of prior service credit	$	264		$	126		(a)
Recognized actuarial loss		(3,664	)		(5,146	)	(a)
		(3,400	)		(5,020	)
		1,207			1,900		Provision for income taxes
	$	(2,193	)	$	(3,120	)	Net income
	For the Six Months Ended June 30, 2014			For the Six Months Ended June 30, 2013			Statements of Operations Classification
	(In thousands)
Derivative Instruments
(Loss) gain on foreign currency forward exchange contracts	$	(5,577	)	$	813		Cost of sales
		(20	)		(10	)	Provision for income taxes
	$	(5,597	)	$	803		Net income
Defined Benefit Pension Plans
Amortization of prior service credit	$	528		$	252		(a)
Recognized actuarial loss		(7,326	)		(10,292	)	(a)
		(6,798	)		(10,040	)
		2,425			3,800		Provision for income taxes
	$	(4,373	)	$	(6,240	)	Net income

(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” of this Quarterly Report on Form 10-Q for additional information regarding Mattel’s net periodic benefit cost.

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Earnings Per Share

6 Months Ended

Jun. 30, 2014

Earnings Per Share

14. Earnings Per Share

Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method. Certain of Mattel’s restricted stock units (“RSUs”) are considered participating securities because they contain nonforfeitable rights to dividend equivalents.

Under the two-class method, net income is reduced by the amount of dividends declared in the period for each class of common stock and participating securities. The remaining undistributed earnings are then allocated to common stock and participating securities as if all of the net income for the period had been distributed. Basic earnings per common share excludes dilution and is calculated by dividing net income allocable to common shares by the weighted average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net income allocable to common shares by the weighted average number of common shares for the period, as adjusted for the potential dilutive effect of non-participating share-based awards. The following table reconciles earnings per common share for the three and six months ended June 30, 2014 and 2013:

	For the Three Months Ended						For the Six Months Ended
	June 30, 2014			June 30, 2013			June 30, 2014			June 30, 2013
	(In thousands, except per share amounts)
Basic:
Net income	$	28,325		$	73,348		$	17,107		$	111,859
Less: net income allocable to participating RSUs (a)		(265	)		(725	)		(199	)		(1,131	)
Net income available for basic common shares	$	28,060		$	72,623		$	16,908		$	110,728
Weighted average common shares outstanding		338,709			346,614			339,463			345,453
Basic net income per common share	$	0.08		$	0.21		$	0.05		$	0.32
Diluted:
Net income	$	28,325		$	73,348		$	17,107		$	111,859
Less: net income allocable to participating RSUs (a)		(270	)		(730	)		(212	)		(1,147	)
Net income available for diluted common shares	$	28,055		$	72,618		$	16,895		$	110,712
Weighted average common shares outstanding		338,709			346,614			339,463			345,453
Weighted average common equivalent shares arising from:
Dilutive stock options and non-participating RSUs		1,935			3,810			2,131			4,050
Weighted average number of common and potential common shares		340,644			350,424			341,594			349,503
Diluted net income per common share	$	0.08		$	0.21		$	0.05		$	0.32

(a) During the three and six months ended June 30, 2014 and 2013, Mattel allocated a proportionate share of both dividends and undistributed earnings to participating RSUs.

The calculation of potential common shares assumes the exercise of dilutive stock options and vesting of non-participating RSUs, net of assumed treasury share repurchases at average market prices. Nonqualified stock options and non-participating RSUs totaling 1.5 million and 0.1 million shares were excluded from the calculation of diluted net income per common share for the three months ended June 30, 2014 and 2013, respectively, because they were antidilutive. Nonqualified stock options and non-participating RSUs totaling 1.4 million and 0.1 million shares were excluded from the calculation of diluted net income per common share for the six months ended June 30, 2014 and 2013, respectively, because they were antidilutive.