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Segment Information (Tables)

3 Months Ended

Mar. 31, 2019

Schedule of Revenue from Segment to Consolidated

The following tables present information about revenues, loss, 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 the tables below). 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 ("CODM") uses gross and net sales by segment as metrics to measure segment performance. Such sales adjustments are included in the determination of segment loss from operations based on the adjustments recorded in the financial accounting systems. Segment loss represents each segment’s operating loss, while consolidated operating loss represents loss from operations before net interest, other non-operating expense (income), net, 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, severance and other restructuring costs, share-based compensation, corporate headquarters functions managed on a worldwide basis, and the impact of changes in foreign currency exchange rates on intercompany transactions.



	For the Three Months Ended
	March 31, 2019			March 31, 2018
	(In thousands)
Revenues by Segment
North America	$	369,391		$	348,390
International	365,178			384,134
American Girl	45,557			67,487
Gross sales	780,126			800,011
Sales adjustments	(90,880		)	(91,639		)
Net sales	$	689,246		$	708,372



	For the Three Months Ended
	March 31, 2019			March 31, 2018
	(In thousands)
Segment Loss
North America (a)	$	(21,585	)	$	(106,750	)
International (a)	(24,303		)	(72,265		)
American Girl (a)	(14,254		)	(14,843		)
	(60,142		)	(193,858		)
Corporate and other expense (b)	(70,817		)	(82,723		)
Operating loss	(130,959		)	(276,581		)
Interest expense	46,958			41,079
Interest (income)	(2,272		)	(3,147		)
Other non-operating expense (income), net	1,904			(608		)
Loss before income taxes	$	(177,549	)	$	(313,905	)

__________________________________________

(a)

Segment loss for the three months ended March 31, 2019 included a $27.3 million charge attributable to the Rock 'n Play product recall, all of which was recorded in the North America segment. For additional information, see "Note 25 to the Consolidated Financial Statements—Subsequent Event." Segment loss for the three months ended March 31, 2018 included $86.8 million of net sales reversal and bad debt expense attributable to the Toys "R" Us liquidation. Of the $86.8 million of charges recognized for the three months ended March 31, 2018, $71.6 million, $12.1 million, and $3.1 million was recorded in the North America, International, and American Girl segments, respectively.

(b)

Corporate and other expense included severance and restructuring expenses of $8.7 million and $24.9 million for the three months ended March 31, 2019 and 2018, respectively, and share-based compensation expense of $11.9 million and $14.4 million for the three months ended March 31, 2019 and 2018, respectively.

Schedule of Segment Assets

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



	March 31, 2019		March 31, 2018		December 31, 2018
	(In thousands)
Assets by Segment
North America	$	520,812	$	523,535	$	615,654
International	569,214		620,718		728,870
American Girl	39,998		94,592		43,748
	1,130,024		1,238,845		1,388,272
Corporate and other	110,281		115,006		124,700
Accounts receivable and inventories, net	$	1,240,305	$	1,353,851	$	1,512,972

Schedule of Worldwide Revenues

The table below presents worldwide revenues by categories:



	For the Three Months Ended
	March 31, 2019			March 31, 2018
	(In thousands)
Worldwide Revenues by Categories (a)
Dolls	$	252,886		$	257,357
Infant/Toddler/Preschool	193,626			226,646
Vehicles	183,361			188,933
Action Figures/Building Sets/Games	150,253			127,075
Gross sales	780,126			800,011
Sales adjustments	(90,880		)	(91,639		)
Net sales	$	689,246		$	708,372

__________________________________________

(a)

Mattel modified its reporting structure for revenues in the first quarter of 2019 to disclose revenues by categories. The table below presents supplemental disclosure of worldwide revenue:



	For the Three Months Ended
	March 31, 2019			March 31, 2018
	(In thousands)
Worldwide Revenues by Top 3 Power Brands
Barbie	$	163,478		$	152,691
Hot Wheels	150,536			144,940
Fisher-Price and Thomas & Friends	172,398			187,795
Other	293,714			314,585
Gross sales	780,126			800,011
Sales adjustments	(90,880		)	(91,639		)
Net sales	$	689,246		$	708,372

Schedule of Revenue by Geographic Area

The table below presents information by geographic area. Revenues are attributed to countries based on location of the customer.



	For the Three Months Ended
	March 31, 2019			March 31, 2018
	(In thousands)
Revenues
North America	$	414,948		$	415,877
International (a)
EMEA	216,349			229,544
Latin America	75,250			74,468
Asia Pacific	73,579			80,122
Total International	365,178			384,134
Gross sales	780,126			800,011
Sales adjustments	(90,880		)	(91,639		)
Net sales	$	689,246		$	708,372

__________________________________________

(a)

Mattel reorganized its regional sales reporting structure in the first quarter of 2019. As a result, the new regions are Europe, the Middle East, and Africa ("EMEA"), Latin America, and Asia Pacific. The Middle East, Africa, Russia, and Turkey were previously included in the Asia Pacific region (previously Global Emerging Markets) and are now included in EMEA (previously Europe). Prior period amounts have been reclassified to conform to the current period presentation.