Mattel's Q1 2026 earnings reveal an unchanged financial outlook with a focus on digital growth strategies including platform integration, mobile game launches, and digital licensing to drive future expansion.
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What are Mattel's updated guidance and outlook for digital growth in 2026?
Based on Mattel’s Q1 2026 earnings call commentary, Mattel’s updated 2026 guidance is unchanged on the top-line, while the company updated/corrected (recast) certain non-GAAP operating and EPS measures. Within that unchanged financial framework, management reiterated a specific digital-growth plan centered on (1) integrating Mattel 163, (2) launching self-published mobile games, and (3) expanding branded digital game experiences and licensing.
Mattel states that full-year net sales guidance is unchanged, expecting 3% to 6% growth in constant currency, and that at spot FX rates FX is expected to be a tailwind of 1 to 2 percentage points on reported net sales. 1
For profitability measures that include the digital-game accounting impact, Mattel says it recast adjusted operating income and adjusted EPS to exclude the impact of amortization of acquired intangible assets (and clarifies that the adjustment relates to Mattel 163 non-Mattel 163 amortization of acquired intangibles). 12 Specifically, Mattel’s adjusted operating income is expected to be $580 million to $630 million, reflecting a $30 million adjustment attributable to non-Mattel 163 amortization that was not included in prior 2026 guidance. 1 Adjusted EPS guidance is $1.27 to $1.39. 1
Gross margin outlook remains approximately 50% for full-year 2026, with management expecting sequential improvement in Q2 but still below 50% in Q2, then improving in the second half. 1
Mattel’s digital outlook for 2026 is less about changing numeric “digital revenue targets” in the guidance and more about execution milestones that management believes will drive growth.
Management emphasizes progress on its digital strategy, explicitly citing integration of Mattel 163 and the fact that acquiring full control of Mattel 163 strengthens its digital games business and adds development, publishing, and digital customer acquisition expertise. 3
This strategic digital push is also reflected in the digital-growth drivers tied to 2026 category expectations, including “continued strong performance in key brands … further amplified by Masters of the Universe … upcoming self-published digital game releases and the consolidation of Mattel 163.” 1
Mattel provides clear 2026 launch timing:
These are the central “digital growth” execution items management highlights within 2026. 3
Mattel also updates the mode of digital growth beyond its own mobile releases, stating it is expanding presence on creative platforms and citing specific examples:
In addition, management describes digital brand demand-generation mechanics using engagement outcomes (examples: a UNO experience on Fortnite becoming top 10 most active/engaged experiences on the platform). 4
Mattel states that digital game licensing contributed to overall growth in the quarter and benefited from partnerships including Pictionary with Netflix and Scramble with scope. 3 While this is discussed as quarter performance, it is part of the digital-growth model management is describing for its strategy. 3
Putting the above together, Mattel’s updated 2026 outlook for digital growth can be summarized as:
Mattel’s updated 2026 guidance (financially) is unchanged on net sales and keeps a ~50% adjusted gross margin target, while recasting adjusted operating income and adjusted EPS due to an adjustment related to amortization of acquired intangible assets. 12 Within that unchanged guidance framework, its updated outlook for digital growth in 2026 centers on integrating and consolidating Mattel 163, launching two self-published mobile games (Masters of the Universe ahead of the June 5 premiere, and a second title later in 2026), and expanding branded platform experiences plus digital licensing as key contributors. 13
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