April 20 (Reuters) - Mattel Inc, the world’s biggest toymaker, reported a bigger-than-expected drop in quarterly sales on Thursday, hurt by weak demand for key brands Barbie and Fisher-Price and due to big discounts to move inventory left after weak holiday sales.
Mattel’s shares tumbled nearly 7 percent to $23.50 in trading after the bell on Thursday.
The company’s first-quarter sales dropped 15.4 percent to $735.6 million, their steepest fall since 2009, and well short of analysts’ average estimate of $801.4 million, according to Thomson Reuters I/B/E/S.
"Our Q1 results were below our expectations due to the retail inventory overhang coming out of the holiday period," Margo Georgiadis, who took over as chief executive in February, said in a statement. (bit.ly/2o8O6c8)
Mattel’ net loss widened to $113.2 million, or 33 cents per share, in the quarter ended March 31, from $73 million, or 21 cents per share, a year earlier.
Excluding items, it lost 32 cents per share.
The company said sales in its girls and boys brands division, which houses Barbie, dropped 16 percent. The division accounted for about 60 percent of total sales.
Barbie sales declined 13 percent, falling for the second straight quarter. Barbie sales had risen for the first three quarters of last year, helped by new marketing efforts and the launch of dolls in a variety of skin tones and body shapes.
Mattel said Fisher-Price sales dropped 9 percent in the latest quarter.
However, Georgiadis said the company had “worked through the majority of” the inventory overhang and also noted sustained momentum in high-growth markets such as China.
Mattel has been trying to boost its presence in China’s fragmented yet lucrative toy market.
The company has signed deals with Chinese e-commerce giant Alibaba Group Holding Ltd and online content developer BabyTree to sell interactive learning products based on its Fisher-Price toys. (Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Savio D‘Souza)