The “Barbie” movie officially crossed the $1 billion threshold at the global box office on Aug. 6, but what does Mattel Inc. stand to gain from this cultural juggernaut — both financially and as a brand?

The film, made in collaboration with Burbank-based Warner Bros. Entertainment Inc., earned $162 million during its domestic opening weekend, the biggest U.S. opening weekend box office of the year, and stands as a testament to the added benefits a manufacturer like Mattel can derive by licensing its intellectual property. The El Segundo-based toy maker released its second-quarter results less than a week after the film debuted in theaters. The report indicated a few positive outcomes regarding opening weekend but provided little guidance on the film’s impact on future quarters.

Mattel’s stock, meanwhile, had been on a steady rise in the months leading up to the feature’s debut, starting as low as $16 per share in March and peaking at $21.83 in July. The company’s stock price was $21.28 as of Aug. 7, a 33% increase from March. It’s outpacing its competitors. Hasbro, for example, has seen its stock increase 19% since March 1, and Santa Monica-based Jakks Pacific Inc. has seen its stock increase 7.7% from March 1.

“This moment will be remembered as a key milestone in our company’s history with the release of the ‘Barbie’ movie, our first ever major theatrical film,” Ynon Kreiz, chair and chief executive of Mattel, said at the time of the July 26 earnings report. 

Kreiz became chief executive of the company in 2018, and within months launched Mattel Films and greenlit the “Barbie” movie, with actress Margot Robbie attached. 

Still, no one yet knows how much of a financial windfall Mattel stands to gain from the film’s box office success. 

“They get some share of the economics of the box office, and we know the box office receipts are very strong for the movie,” said Linda Bolton Weiser, managing director and senior analyst at D.A. Davidson & Co. “But we don’t know how much above their plan this is. They haven’t laid out the general structure of the economics behind the sharing of that.”

Gains coming?

Overall, Mattel’s second quarter didn’t reflect any major bump leading up to the film’s opening weekend. The company saw a decline in sales during the quarter, as retailers are still selling off surplus stock from the pandemic era. The company saw a decrease of 12% in net sales compared to the same time last year and reported operating income of $63 million, down $62 million year over year.

“Investors … have been very wary of this,” said Arpine Kocharyan, executive director at UBS Investment Bank, of Kreiz’s strategy of licensing the company’s toy IP. “Someone else is going to put that capital to work and we simply are going to see the benefit of that or the halo effect on our business? People didn’t believe it.” 

Yet there were positive indications that the film would move merchandise going forward.  

Kreiz noted on the earnings call that many of the toys and merchandise based on the film had already sold out, adding that more would hit retailers soon. The company has more than 165 consumer product collaborations connected to the film. 

“The Barbie movie is a showcase for the cultural resonance of our IP, our ability to attract and collaborate with top creative talent, and the capabilities of our franchise management organization,” said Kreiz. “This also speaks to the potential of Mattel Films and the significant progress of our strategy to capture the full value of our IP.”

Bigger push

The “Barbie” film is just part of Mattel’s plans to capitalize on its extensive IP catalog. Projects in the works include a car-centered Hot Wheels film, a Barney the purple dinosaur feature and a movie based on the tiny doll playset brand Polly Pocket.

The billion-dollar question is whether any of Mattel’s other IPs have the ability to drive another massive hit film. 

The second-highest film opening of this year was “The Super Mario Bros. Movie,” which currently stands at $1.35 billion in the global box office. That film was born out of a gaming IP from Nintendo from the 1980s, indicating that nostalgia for childhood toys and games is still running strong. 

But it remains to be seen if “Barbie” the film will spur Barbie sales into the all-important holiday season. The film has a PG-13 rating and is targeted at  teens and adults who likely engaged with the brand as children.

“People are looking at whether it is actually going to drive traditional toy sales because you’re not gonna be taking a 5-year-old or six-year-old to watch this movie,” said Kocharyan. “The core demographic typically is a little bit older versus something like another fashion doll like a Disney princess or ‘Frozen.’” 

Mattel handed the creative reins of the “Barbie” movie to Academy Award-nominated director Greta Gerwig and will entrust its other brands to high-level creative talent. The Hot Wheels feature will be overseen by Emmy-award winning producer J.J. Abrams, while the Barney movie has attached Oscar-nominee Daniel Kaluuya. Polly Pocket is currently being written and directed by Emmy-nominated Lena Dunham and will feature “Emily in Paris” star Lily Collins in the lead role.

“Mattel has more than 10 other movie properties under development, so their success with this one and overseeing this project is certainly going to give confidence to the other ones,” said D.A. Davidson & Co.’s Bolton Weiser. “Certainly, Barbie is the biggest and most important brand equity in their portfolio, so it’s hard for me to imagine the ‘Polly Pocket’ movie being as much of a big deal as this one.” 

Hasbro has also seen success partnering with studios to bolster the branding of its toys, including Transformers and My Little Pony. 

In 2019, Hasbro acquired Entertainment One Ltd. for $4 billion to create its own distribution pipeline for its toy IP content. However, in August, Hasbro confirmed the sale of Entertainment One to Santa Monica-based Lions Gate Entertainment Corp. for $500 million. 

“It’s really important to take a step back and realize that there are only a handful of toy franchises that have become successful box office events,” noted Kocharyan. “But I can think, right off the top of my head, of a (movie with a) successful box office then becoming a successful toy franchise — everything from ‘Spiderman,’ ‘Iron Man,’ ‘Star Wars,’ ‘Frozen’ and ‘Cars’ and ‘Toy Story.’”