Mattel reports a 20 percent jump in sales.

Mattel mentioned on Thursday that its income jumped 20 % within the second quarter regardless of rising costs, an indication that buyers have been persevering with to purchase Polly Pocket dolls and Mega building units regardless of rising inflation.

Income for the April-through-June interval was $1.2 billion, up from $1 billion in the identical quarter final 12 months, the toymaker mentioned in a press release. The corporate swung to a revenue of $66.4 million within the quarter after reporting a lack of $5.5 million final 12 months.

After struggling for a number of years, the corporate has been in turnaround mode ever since Ynon Kreiz took over as chief government in 2018. The sturdy second-quarter earnings have been a results of the corporate’s efforts to capitalize on its mental property and broaden its leisure choices, Mr. Kreiz mentioned in an interview on Thursday.

Barbie, certainly one of Mattel’s greatest franchises, will probably be featured in a live-action film starring Margot Robbie subsequent 12 months, and J.J. Abrams’s manufacturing firm, Unhealthy Robotic, lately signed on to make a live-action film based mostly on Mattel’s Scorching Wheels line.

“We actually shifted from being a producing firm that was making objects to an I.P.-driven firm that’s managing franchises,” Mr. Kreiz mentioned. “Our firm is now in progress mode.”

The toymaker’s earnings have been sturdy regardless of rising prices for supplies and better inflation, which rose 9.1 % in June, placing a squeeze on shoppers.

However toy gross sales are typically resilient in downtimes as a result of dad and mom don’t wish to disappoint their youngsters, mentioned Linda Bolton Weiser, an analyst with D.A. Davidson who covers the toy business.

“Toys are thought-about a smooth cyclical,” she mentioned. “They maintain up rather well in a recession.”

Like its important rival, Hasbro, Mattel faces a brand new risk in a powerful greenback. The corporate mentioned its income would have been 4 share factors greater if not for fluctuations in overseas foreign money charges abroad.

“That is going to be hitting quite a lot of multinational firms,” Ms. Bolton Weiser mentioned. “The greenback is strengthening on daily basis.”

Mattel maintained its steering for income progress of 8 % to 10 % for the 12 months, saying it will likely be capable of meet demand within the all-important vacation season.

“We’re working carefully with our companions to ensure there may be product on cabinets,” Mr. Kreiz mentioned, including that Mattel is working with its factories and third-party distributors all over the world. “A giant a part of our success is how we handle our provide chain.”

After falling to $7.42 within the early days of the pandemic, Mattel’s inventory value has risen steadily.