Mattel (MAT) 10-Q 28 Oct 09 2009 Q3 Quarterly report Financial data

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Thousands	Sep. 30, 2009	Dec. 31, 2008	Sep. 30, 2008
Current Assets
Cash and equivalents	$323,718	$617,694	$446,804
Accounts receivable, net	1,450,320	873,542	1,712,820
Inventories	606,019	485,925	751,133
Prepaid expenses and other current assets	323,435	409,689	304,781
Total current assets	2,703,492	2,386,850	3,215,538
Noncurrent Assets
Property, plant, and equipment, net	513,160	536,162	525,206
Goodwill	826,816	815,803	827,431
Other noncurrent assets	945,599	936,224	955,615
Total Assets	4,989,067	4,675,039	5,523,790
Current Liabilities
Short-term borrowings	159,292	0	528,312
Current portion of long-term debt	50,000	150,000	150,000
Accounts payable	406,436	421,736	515,985
Accrued liabilities	709,829	649,383	711,574
Income taxes payable	11,115	38,855	45,264
Total current liabilities	1,336,672	1,259,974	1,951,135
Noncurrent Liabilities
Long-term debt	710,000	750,000	760,000
Other noncurrent liabilities	536,697	547,930	391,447
Total noncurrent liabilities	1,246,697	1,297,930	1,151,447
Stockholders' Equity
Common stock $1.00 par value, 1.0 billion shares authorized; 441.4 million shares issued	441,369	441,369	441,369
Additional paid-in capital	1,638,563	1,642,092	1,634,086
Treasury stock at cost; 80.2 million shares, 82.4 million shares, and 82.9 million shares, respectively	(1,569,386)	(1,621,264)	(1,612,900)
Retained earnings	2,286,112	2,085,573	2,180,849
Accumulated other comprehensive loss	(390,960)	(430,635)	(222,196)
Total stockholders' equity	2,405,698	2,117,135	2,421,208
Total Liabilities and Stockholders' Equity	$4,989,067	$4,675,039	$5,523,790

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
	Sep. 30, 2009	Dec. 31, 2008	Sep. 30, 2008
Common stock, par value	$1	$1	$1
Common stock, shares authorized	1,000,000,000	1,000,000,000	1,000,000,000
Common stock, shares issued	441,400,000	441,400,000	441,400,000
Treasury stock, shares	80,200,000	82,900,000	82,400,000

Consolidated Statements Of Oper

Consolidated Statements Of Operations (USD $)
In Thousands, except Per Share data	3 Months Ended Sep. 30, 2009	3 Months Ended Sep. 30, 2008	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Net Sales	$1,791,875	$1,946,315	$3,475,718	$3,978,045
Cost of sales	873,260	1,046,245	1,805,171	2,185,805
Gross Profit	918,615	900,070	1,670,547	1,792,240
Advertising and promotion expenses	197,106	223,826	370,990	443,592
Other selling and administrative expenses	385,055	360,895	985,799	1,039,226
Operating Income	336,454	315,349	313,758	309,422
Interest expense	19,317	20,411	52,723	53,026
Interest (income)	(1,510)	(6,013)	(7,513)	(21,831)
Other non-operating expense (income), net	14,014	(6,157)	5,548	15,988
Income Before Income Taxes	304,633	307,108	263,000	262,239
Provision for income taxes	74,791	69,010	62,675	59,004
Net Income	$229,842	$238,098	$200,325	$203,235
Net Income Per Common Share-Basic	0.63	0.65	0.55	0.56
Weighted average number of common shares	360,843	360,881	359,513	361,339
Net Income Per Common Share-Diluted	0.63	0.65	0.55	0.56
Weighted average number of common and potential common shares	361,925	361,742	360,330	362,506

Consolidated Statements Of Cash

Consolidated Statements Of Cash Flows (USD $)
In Thousands	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Cash Flows From Operating Activities:
Net Income	$200,325	$203,235
Adjustments to reconcile net income to net cash flows used for operating activities:
Depreciation	112,812	119,444
Amortization	13,719	8,710
Asset impairments and disposals	12,616	8,646
Deferred income taxes	(27,086)	(3,587)
Share-based compensation	35,030	25,089
Increase (decrease) from changes in assets and liabilities:
Accounts receivable	(545,404)	(752,916)
Inventories	(81,242)	(374,560)
Prepaid expenses and other current assets	(31,698)	(18,303)
Accounts payable, accrued liabilities, and income taxes payable	23,155	105,339
Other, net	(31,034)	12,326
Net cash flows used for operating activities	(318,807)	(666,577)
Cash Flows From Investing Activities:
Purchases of tools, dies, and molds	(57,615)	(58,031)
Purchases of other property, plant, and equipment	(32,837)	(80,466)
Increase in long-term investments	0	(85,300)
Payments for businesses acquired	0	(23,451)
Proceeds from sale of investments	67,134	0
Proceeds from sale of other property, plant, and equipment	454	4,949
Proceeds from foreign currency forward exchange contracts	20,214	18,298
Net cash flows used for investing activities	(2,650)	(224,001)
Cash Flows From Financing Activities:
Payments of short-term borrowings	(294,392)	(451,263)
Proceeds from short-term borrowings	453,090	633,410
Payments of long-term borrowings	(140,000)	(40,000)
Proceeds from long-term borrowings	0	347,183
Payment of credit facility renewal costs	(11,237)	0
Share repurchases	0	(65,469)
Proceeds from exercise of stock options	20,601	18,279
Other, net	(7,064)	(91)
Net cash flows provided by financing activities	20,998	442,049
Effect of Currency Exchange Rate Changes on Cash	6,483	(5,815)
Decrease in Cash and Equivalents	(293,976)	(454,344)
Cash and Equivalents at Beginning of Period	617,694	901,148
Cash and Equivalents at End of Period	323,718	446,804
Cash paid during the period for:
Income taxes, gross	90,312	54,655
Interest	$49,204	$45,215

1.Basis of Presentation

1.Basis of Presentation
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
1.Basis of Presentation	1. Basis of Presentation The accompanying unaudited consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States of America applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair presentation of the financial position and interim results of Mattel, Inc. and its subsidiaries (Mattel or the Company) as of and for the periods presented, have been included. Because Mattels business is seasonal, results for interim periods are not necessarily indicative of those that may be expected for a full year. In preparing these financial statements, Mattel evaluated the events and transactions that occurred between September30, 2009 through October28, 2009, the date these financial statements were issued. The year-end balance sheet data was derived from audited financial statements, however, the accompanying interim notes to the consolidated financial statements do not include all disclosures required by accounting principles generally accepted in the United States of America. The financial information included herein should be read in conjunction with Mattels consolidated financial statements and related notes in its 2008 Annual Report on Form 10-K. On July1, 2009, Mattel adopted Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 105-10 (formerly Statement of Financial Accounting Standards (SFAS)No.168, The FASB Accounting Standards Codification and Hierarchy of Generally Accepted Accounting Principles, a replacement of FASB Statement No.162). ASC 105-10 establishes the FASB ASC as the source of authoritative accounting principles recognized by the FASB to be applied in preparation of financial statements in conformity with generally accepted accounting principles in the United States of America. The adoption of this standard had no impact on Mattels consolidated financial statements.

2.Accounts Receivable

2.Accounts Receivable
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
2.Accounts Receivable	2. Accounts Receivable Accounts receivable are net of allowances for doubtful accounts of $38.3 million, $30.3 million, and $25.9 million as of September30, 2009,September30, 2008, and December31, 2008, respectively.

3.Inventories

3.Inventories
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
3.Inventories	3. Inventories Inventories include the following: September30,2009 September30,2008 December31,2008 (In thousands) Raw materials and work in process $ 65,247 $ 70,995 $ 57,311 Finished goods 540,772 680,138 428,614 $ 606,019 $ 751,133 $ 485,925

4.Property, Plant, and Equipmen

4.Property, Plant, and Equipment
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
4.Property, Plant, and Equipment	4. Property, Plant, and Equipment Property, plant, and equipment, net include the following: September30,2009 September30,2008 December31,2008 (In thousands) Land $ 26,613 $ 26,632 $ 26,499 Buildings 241,268 238,681 237,561 Machinery and equipment 773,192 760,485 758,656 Tools, dies, and molds 587,664 627,974 544,789 Capital leases 23,271 23,271 23,271 Leasehold improvements 176,909 162,071 162,288 1,828,917 1,839,114 1,753,064 Less: accumulated depreciation (1,315,757 ) (1,313,908 ) (1,216,902 ) $ 513,160 $ 525,206 $ 536,162

5.Goodwill

5.Goodwill
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
5.Goodwill	5. Goodwill Goodwill is allocated to various reporting units, which are either at the operating segment level or one reporting level below the operating segment level, for purposes of evaluating whether goodwill is impaired. Mattels reporting units are: MattelGirls BrandsUS, Mattel Boys Brands US, Fisher-Price Brands US, AmericanGirl Brands, and International. Mattel tests its goodwill for impairment annually in the third quarter, and whenever events or changes in circumstances indicate that the carrying value may not be recoverable, based on the fair value of the cash flows that the reporting units can be expected to generate in the future. In the third quarter of 2009, Mattel performed the annual impairment test and determined that goodwill was not impaired. The change in the carrying amount of goodwill by reporting unit for the nine months ended September30,2009 is shown below. Brand-specific goodwill held by foreign subsidiaries is allocated to the US reporting units selling those brands, thereby causing foreign currency translation impact for the US reporting units. December31,2008 ImpactofCurrency ExchangeRate Changes September30,2009 (In thousands) Mattel Girls Brands US $ 29,224 $ 2,517 $ 31,741 Mattel Boys Brands US 130,883 (173 ) 130,710 Fisher-Price Brands US 215,520 494 216,014 American Girl Brands 207,571 207,571 International 232,605 8,175 240,780 $ 815,803 $ 11,013 $ 826,816

6.Other Noncurrent Assets

6.Other Noncurrent Assets
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
6.Other Noncurrent Assets	6. Other Noncurrent Assets Other noncurrent assets include the following: September30,2009 September30,2008 December31,2008 (In thousands) Deferred income taxes $ 541,588 $ 470,910 $ 524,451 Nonamortizable identifiable intangibles 122,223 128,382 128,382 Identifiable intangibles (net of amortization of $66.8million, $59.1 million, and $61.8 million, respectively) 92,984 86,982 107,447 Long-term investments 35,000 116,300 35,000 Other 153,804 153,041 140,944 $ 945,599 $ 955,615 $ 936,224 As of September30, 2008, Mattel had a money market investment with a net cost basis of $81.3million, which was reclassified from cash and equivalents to noncurrent assets as a result of the money market investment fund halting redemption requests in September 2008. As of December31, 2008, the investment was reclassified to other current assets as Mattel expected to receive the proceeds of this investment by the end of 2009, when the underlying securities will have matured. During the nine months ended September30, 2009, Mattel received proceeds of approximately $67 million. As of September30, 2009,September30, 2008, and December31, 2008, Mattel also had additional long-term investments of $35.0 million. In October 2008, Mattel acquired Sekkoia SAS, which owns the Blokus trademark and trade name rights, for $35.1 million in cash, including acquisition costs. In connection with the acquisition, Mattel recorded goodwill and amortizable identifiable intangible assets totaling $18.1 million and $22.9 million, respectively.

7.Accrued Liabilities

7.Accrued Liabilities
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
7.Accrued Liabilities	7. Accrued Liabilities Accrued liabilities include the following: September30,2009 September30,2008 December31,2008 (In thousands) Advertising and promotion $ 116,192 $ 131,958 $ 56,941 Royalties 71,510 86,392 86,152 Derivatives payable 42,496 6,606 11,757 Receivable collections due bank 44,470 82,245 Other 479,631 442,148 412,288 $ 709,829 $ 711,574 $ 649,383

8.Product Recalls and Withdrawa

8.Product Recalls and Withdrawals
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
8.Product Recalls and Withdrawals	8. Product Recalls and Withdrawals During 2007, Mattel recalled products with high-powered magnets that may become dislodged and other products, some of which were produced using non-approved paint containing lead in excess of applicable regulatory and Mattel standards. During the second half of 2007, additional products were recalled, withdrawn from retail stores, or replaced at the request of consumers as a result of safety or quality issues (collectively, the 2007 Product Recalls). In the second quarter of 2008, Mattel determined that certain products had been shipped into foreign markets in which the products did not meet all applicable regulatory standards for those markets. None of these deficiencies related to lead or magnets. Mattel withdrew these products from retail stores in these markets and, although not required to do so, also withdrew the products from the US and other markets because they did not meet Mattels internal standards (the 2008 Product Withdrawal). The following table summarizes Mattels reserves and reserve activity for the 2007 Product Recalls and the 2008 Product Withdrawal for the nine months ended September30, 2009: Reserves at December31, 2008 Reserves Used Changesin Estimates ImpactofCurrency ExchangeRate Changes Reservesat September30, 2009 (In thousands) Product returns/redemption $ 3,605 $ (1,141 ) $ (2,083 ) $ 77 $ 458 Other 1,338 (299 ) (6 ) (26 ) 1,007 $ 4,943 $ (1,440 ) $ (2,089 ) $ 51 $ 1,465 The following table summarizes Mattels reserves and reserve activity for the 2007 Product Recalls and the 2008 Product Withdrawal for the nine months ended September30, 2008: Reserves at December31, 2007 2008 Product Withdrawal Reserves Used Changesin Estimates ImpactofCurrency ExchangeRate Changes Reservesat September30, 2008 (In thousands) Impairment of inventory on hand $ $ 3,571 $ (3,571 ) $ $ $ Product returns/redemption 12,612 5,862 (14,666 ) 2,447 37 6,292 Other 2,360 244 (1,665 ) 684 (54 ) 1,569 $ 14,972 $ 9,677 $ (19,902 ) $ 3,131 $ (17 ) $ 7,861 Following the announcement of the 2007 Product Recalls and 2008 Product Withdrawal, a number of lawsuits were filed against Mattel with respect to the recalled and withdrawn products, which are more fully described in Note 12 to the Consolidated Financial Statements in Mattels 2008 Annual Report on Form 10-K and Note 23, Contingencies, of this Quarterly Report on Form 10-Q. During the three and nine months ended September30,2009, Mattel recorded charges of $5.4 million and $27.4 million, respectively, which are included in other selling and administrative expenses, to reserve for the settlement of a portion of the above-described product liability-related litigation. Additionally, during the nine months en

9.Restructuring Charges

9.Restructuring Charges
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
9.Restructuring Charges	9. Restructuring Charges During the second quarter of 2008, Mattel initiated the Global Cost Leadership program, which is designed to improve operating efficiencies and leverage Mattels global scale to improve profitability and operating cash flows. The major initiatives of Mattels Global Cost Leadership program include: A global reduction in Mattels professional workforce of approximately 1,000 employees that was implemented beginning in November 2008, and an additional reduction in Mattels professional workforce initiated in the third quarter of 2009. A coordinated efficiency strategic plan that includes structural changes designed to lower costs and improve efficiencies; for example, offshoring and outsourcing certain back office functions, and more clustering of management for international markets. Additional procurement initiatives designed to fully leverage Mattels global scale in areas such as creative agency partnerships, legal services, and distribution, including ocean carriers and over-the-road freight vendors. In connection with the Global Cost Leadership program, during the three and nine months ended September30, 2009, Mattel recorded severance and other termination-related charges of $18.1 million and $25.3 million, respectively, which are included in other selling and administrative expenses. The following table summarizes Mattels severance and other termination costs activity for the nine months ended September30, 2009 (in thousands): Reserves at December31, 2008 2009 Charges Payments Reservesat September30, 2009 Severance $ 17,115 $ 25,075 $ (20,851 ) $ 21,339 Other termination costs 881 257 (630 ) 508 $ 17,996 $ 25,332 $ (21,481 ) $ 21,847

10.Seasonal Financing

10.Seasonal Financing
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
10.Seasonal Financing	10. Seasonal Financing Mattel maintains and periodically amends or replaces its domestic unsecured committed revolving credit facility with a commercial bank group that is used as the primary source of financing for the seasonal working capital requirements of its domestic subsidiaries. The agreement in effect was amended and restated on March23, 2009 to, among other things, (i)extend the maturity date of the credit facility to March23, 2012, (ii)reduce aggregate commitments under the credit facility from $1.3 billion to $880.0 million, with an accordion feature, which would allow Mattel to increase the availability under the credit facility to $1.08 billion under certain circumstances, (iii)add an interest rate floor equal to 30-day US Dollar London Interbank Offered Rate (LIBOR) plus 1.00% for base rate loans under the credit facility, (iv)increase the applicable interest rate margins to a range of 2.00% to 3.00% above the applicable base rate for base rate loans, and 2.5% to 3.5% above the applicable LIBOR rate for Eurodollar rate loans, depending on Mattels senior unsecured long-term debt rating, (v)increase commitment fees to a range of 0.25% to 0.75% of the unused commitments under the credit facility, and (vi)replace the consolidated debt-to-capital ratio with a consolidated debt-to-earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio. In April and July 2009, Mattel utilized the accordion feature of the credit facility to increase the aggregate commitments under the credit facility by $60.0 million and $95.0 million, respectively. On October9, 2009, Mattel further increased the aggregate commitments under the credit facility by $45.0 million, from $1.035 billion to $1.08 billion, which is the maximum aggregate commitment available under the credit facility. Mattel has a $300.0 million domestic receivables sales facility that is a sub-facility of Mattels domestic unsecured committed revolving credit facility, which was also amended in connection with the amendment of the credit facility. The amendment to the receivables sales facility, among other things, (i)extended the maturity date of the receivables sales facility to March23, 2012, and (ii)incorporated the credit facilitys increased applicable interest rate margins described above.

11.Long-term Debt

11.Long-term Debt
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
11.Long-term Debt	11. Long-term Debt Long-term debt includes the following: September30, 2009 September30, 2008 December31, 2008 (In thousands) Medium-term notes due November 2009 to November2013 $ 210,000 $ 260,000 $ 250,000 2006 Senior Notes due June 2011 200,000 300,000 300,000 2008 Senior Notes due March 2013 350,000 350,000 350,000 760,000 910,000 900,000 Less: current portion (50,000 ) (150,000 ) (150,000 ) $ 710,000 $ 760,000 $ 750,000 In June 2009, Mattel repaid $100.0 million of the 2006 unsecured floating rate senior notes (Floating Rate Senior Notes) in connection with their scheduled maturity. Additionally, during the nine months ended September30, 2009, Mattel repaid $40.0 million of its Medium-term notes in connection with their scheduled maturity.

12.Other Noncurrent Liabilities

12.Other Noncurrent Liabilities
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
12.Other Noncurrent Liabilities	12. Other Noncurrent Liabilities Other noncurrent liabilities include the following: September30, 2009 September30, 2008 December31, 2008 (In thousands) Benefit plan liabilities $ 267,899 $ 144,381 $ 286,557 Noncurrent tax liabilities 135,134 119,156 132,744 Other 133,664 127,910 128,629 $ 536,697 $ 391,447 $ 547,930

13.Comprehensive Income

13.Comprehensive Income
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
13.Comprehensive Income	13. Comprehensive Income The changes in the components of comprehensive income, net of tax, are as follows: FortheThreeMonthsEnded FortheNineMonthsEnded September30, 2009 September30, 2008 September30, 2009 September30, 2008 (In thousands) Net income $ 229,842 $ 238,098 $ 200,325 $ 203,235 Currency translation adjustments (2,272 ) (146,571 ) 60,802 (67,268 ) Defined benefit pension plans net prior service cost and net actuarial loss 3,902 289 6,429 896 Net unrealized (losses) gains on derivative instruments: Unrealized holding (losses) gains (11,039 ) 18,249 (18,439 ) (6,445 ) Reclassification adjustment for realized (gains) losses included in net income (5,379 ) 13,365 (9,117 ) 26,431 (16,418 ) 31,614 (27,556 ) 19,986 $ 215,054 $ 123,430 $ 240,000 $ 156,849 The components of accumulated other comprehensive loss are as follows: September30, 2009 September30, 2008 December31, 2008 (In thousands) Currency translation adjustments $ (214,049 ) $ (149,542 ) $ (274,851 ) Defined benefit pension and other postretirement plans, net of tax (154,284 ) (72,181 ) (160,713 ) Net unrealized (loss) gain on derivative instruments, net of tax (22,627 ) (473 ) 4,929 $ (390,960 ) $ (222,196 ) $ (430,635 ) Currency Translation Adjustments Mattels reporting currency is the US dollar. The translation of its results of operations and financial position of subsidiaries with non-US dollar functional currencies subjects Mattel to currency exchange rate fluctuations in its results of operations and financial position. Assets and liabilities of subsidiaries with non-USdollar functional currencies are translated into US dollars at fiscal period-end exchange rates. Income, expense, and cash flow items are translated at weighted average exchange rates prevailing during the fiscal period. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive loss within stockholders equity. For the nine months ended September30, 2009, currency translation adjustments resulted in a net gain of $60.8 million, with gains primarily from the strengthening of the Euro, Brazilian real, British pound sterling, Chilean peso, and Indonesian rupiah against the US dollar. For the nine months ended September30, 2008, currency translation adjustments resulted in a net loss of $67.3 million, with losses primarily from the weakening of the Euro, British pound sterling, and Brazilian real against the US dollar.

14.Income Taxes

14.Income Taxes
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
14.Income Taxes	14. Income Taxes Mattels provision for income taxes was $62.7 million for the nine months ended September30, 2009, as compared to $59.0 million for the nine months ended September30, 2008. During the three months ended September30, 2009, Mattel recognized discrete tax expense of $2.2 million related to a change in previously recorded taxes based on tax return filings and recently enacted tax law. During the nine months ended September30, 2009, Mattel recognized net discrete tax benefits of $0.3 million related to a change in estimate of previously unrecognized tax benefits and a change in previously recorded taxes based on tax return filings and the impact of state law changes. During the three months ended September30, 2009, Mattel took a tax position related to the recognition of a capital loss from the liquidation of certain Canadian subsidiaries acquired as part of The Learning Company acquisition. This tax position does not meet the requirements to be recognized in the financial statements and, accordingly, Mattel has an unrecognized tax benefit of approximately $167 million related to the capital loss claimed. In the event the unrecognized tax benefit were to later meet the financial statement recognition requirements, it is uncertain as to whether there would be any benefit to Mattels provision for income taxes as projected capital gain income in the carryforward period to utilize this capital loss may not be sufficient and a valuation allowance, up to the full amount, would likely be required. During the normal course of business, Mattel is regularly audited by federal, state, and foreign tax authorities. The Internal Revenue Service (IRS) is currently auditing Mattels 2006 and 2007 federal income tax returns. The IRS audit plan calls for the completion of the current examination in the second quarter of 2010. At this time, there is insufficient information related to current IRS, state, and foreign audits to quantify any possible changes in the unrecognized tax benefits that may occur during the next twelve months.

15.Foreign Currency Transaction

15.Foreign Currency Transaction Gains and Losses
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
15.Foreign Currency Transaction Gains and Losses	15. Foreign Currency Transaction Gains and Losses Currency exchange rate fluctuations may impact Mattels results of operations and cash flows. Mattels currency transaction exposures include gains and losses realized on unhedged inventory purchases and unhedged receivables and payables balances that are denominated in a currency other than the applicable functional currency. Gains and losses on unhedged inventory purchases and other transactions associated with operating activities are recorded in the components of operating income to which they relate in the consolidated statements of operations. For hedges of intercompany loans and advances, which do not qualify for hedge accounting treatment, the gains or losses onthe hedges resulting from changes in fair value as well as the offsetting transaction gains or losses on the related hedged items, along with unhedged items, are recognized in non-operating(income) expense in the consolidated statements ofoperations.Inventory purchase and sale transactions denominated in the Euro, British pound sterling, Mexican peso, and Venezuelan bolivar fuerte are the primary transactions that cause foreign currency transaction exposure for Mattel. Currency transaction (gains) losses included in the consolidated statements of operations are as follows: FortheThreeMonthsEnded FortheNineMonthsEnded September30, 2009 September30, 2008 September30, 2009 September30, 2008 (In thousands) Operating income $ (34,000 ) $ (45,839 ) $ (63,125 ) $ (89,521 ) Other non-operating expense (income), net 12,259 (10,693 ) 3,635 11,829 Net transaction gains $ (21,741 ) $ (56,532 ) $ (59,490 ) $ (77,692 )

16.Derivative Instruments

16.Derivative Instruments
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
16.Derivative Instruments	16. Derivative Instruments Effective January1, 2009, Mattel adopted ASC 815-10 (formerly SFAS No.161, Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No.133). ASC 815-10 amends and expands the current disclosure requirements to provide users of financial statements with an enhanced understanding of (i)how and why an entity uses derivative instruments, (ii)how derivative instruments and related hedged items are accounted for, and (iii)how derivative instruments and related hedged items affect an entitys financial position, results of operations, and cash flows. The adoption of this standard had no impact on Mattels financial statements. Mattel seeks to mitigate its exposure to foreign currency transaction risk by monitoring its foreign currency transaction exposure for the year and partially hedging such exposure using foreign currency forward exchange contracts. Mattel uses foreign currency forward exchange contracts as cash flow hedges primarily to hedge its purchases and sales of inventory denominated in foreign currencies. These contracts generally have maturity dates up to 18 months. These derivative instruments have been designated as effective cash flow hedges, whereby the unsettled hedges are reported in Mattels consolidated balance sheets at fair value, with changes in the fair value of the hedges reflected in other comprehensive income (OCI). Realized gains and losses for these contracts are recorded in the consolidated statements of operations in the period in which the inventory is sold to customers. Additionally, Mattel uses foreign currency forward exchange contracts to hedge intercompany loans and advances denominated in foreign currencies. Due to the short-term nature of the contracts involved, Mattel does not use hedge accounting for these contracts, and as such, changes in fair value are recorded in the period of change in the consolidated statements of operations. As of September30, 2009, Mattel held foreign currency forward exchange contracts with notional amounts of approximately $1.17 billion, which was equal to the exposure hedged. In connection with the issuance of its $100.0 million of Floating Rate Senior Notes, Mattel entered into two interest rate swap agreements, each in a notional amount of $50.0million, for the purpose of hedging the variability of cash flows in the interest payments due to fluctuations of the LIBOR benchmark interest rate. The two interest rate swap agreements expired in June 2009, which corresponded with the maturity of the Floating Rate Senior Notes. These derivative instruments were designated as effective cash flow hedges, whereby the hedges were reported in Mattels consolidated balance sheets at fair value, with changes in the fair value of the hedges reflected in OCI. Under the terms of the agreements, Mattel received quarterly interest payments from the swap counterparties based on the three-month LIBORplus 40 basis points and made semi-annual interest payments to the swap counterparties based on a fixed rate of 5.871%. The three-month LIBOR used to determine interest payments under the interest rate swap agreements had reset

17.Fair Value Measurements

17.Fair Value Measurements
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
17.Fair Value Measurements	17. Fair Value Measurements The following table presents information about Mattels assets and liabilities measured and reported in the financial statements at fair value on a recurring basis as of September30, 2009 and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value. The three levels of the fair value hierarchy are as follows: Level 1 Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access. Level 2 Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. Level 3 Valuations based on inputs that are unobservable, supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Mattel does not have any significant financial assets or liabilities measured at fair value using Level 1 or Level 3 inputs as of September30, 2009,September30, 2008, or December31, 2008. Mattels financial assets and liabilities measured using Level 2 inputs include the following: September30,2009 September30,2008 December31,2008 (In thousands) Assets: Foreign currency forward exchange contracts (a) $ 9,866 $ 28,446 $ 24,714 Liabilities: Foreign currency forward exchange contracts (a) $ 46,498 $ 15,001 $ 12,326 Interest rate swaps (b) 3,216 1,934 Total liabilities $ 46,498 $ 18,217 $ 14,260 (a) The fair value of the foreign currency forward exchange contracts is based on dealer quotes of market forward rates and reflects the amount that Mattel would receive or pay at their maturity dates for contracts involving the same currencies and maturity dates. (b) The fair value of the interest rate swaps is based on dealer quotes using cash flows discounted at relevant market interest rates. Effective January1, 2009, Mattel adopted ASC 820-10 (formerly SFAS No.157, Fair Value Measurements), for all nonfinancial assets and liabilities that are measured at fair value on a non-recurring basis, such as goodwill and identifiable intangible assets. The adoption of this standard for nonfinancial assets and liabilities that are measured at fair value on a non-recurring basis did not impact Mattels financial position or results of operations for the three and nine months ended September30, 2009, and Mattel does not expect the adoption to have a material impact on the amounts reported in the financial statements in future periods. Effective April1, 2009, Mattel adopted ASC 820-10 (formerly FASB Staff Position (FSP) No.157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or the Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly). This standard provides additional guidance on (i)estimating fair value whe

18.Fair Value of Financial Inst

18.Fair Value of Financial Instruments
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
18.Fair Value of Financial Instruments	18. Fair Value of Financial Instruments Effective April1, 2009, Mattel adopted ASC 825-10 (formerly FSP No. FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments), which requires disclosures about fair value of financial instruments in interim as well as in annual financial statements. Mattels financial instruments include cash and equivalents, investments, accounts receivable and payable, short-term borrowings, and accrued liabilities. The carrying amount of these instruments approximates fair value because of their short-term nature. The estimated fair value of Mattels long-term debt, including the current portion, is $796.7 million (compared to a carrying amount of $760.0 million) as of September30, 2009. The estimated fair value has been calculated based on broker quotes or rates for the same or similar instruments. The fair value related disclosures for Mattels derivative financial instruments are included in Note 16, Derivative Instruments, and Note 17, Fair Value Measurements.

19.Other Selling and Administra

19.Other Selling and Administrative Expenses
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
19.Other Selling and Administrative Expenses	19. Other Selling and Administrative Expenses Other selling and administrative expenses include the following: FortheThreeMonthsEnded FortheNineMonthsEnded September30,2009 September30,2008 September30,2009 September30,2008 (In thousands) Design and development $ 43,787 $ 48,172 $ 127,696 $ 138,474 Identifiable intangible asset amortization 2,601 2,268 7,916 7,097

20.Earnings Per Share

20.Earnings Per Share
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
20.Earnings Per Share	20. Earnings Per Share Effective January1, 2009, Mattel adopted ASC 260-10 (formerly FSP Emerging Issues Task Force No.03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities). Under ASC 260-10, unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. Certain of Mattels restricted stock units (RSUs) are considered participating securities because they contain nonforfeitable rights to dividend equivalents. The retrospective application of this standard reduced previously reported basic and diluted earnings per share by $0.01 for the three months ended September30, 2008, and had no impact on the previously reported nine month period ended September30, 2008. Under the two-class method, net income is reduced by the amount of dividends declared in the period for each class of common stock and participating securities. The remaining undistributed earnings are then allocated to common stock and participating securities as if all of the net income for the period had been distributed. Basic earnings per common share excludes dilution and is calculated by dividing net income allocable to common shares by the weighted average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net income allocable to common shares by the weighted average number of common shares for the period, as adjusted for the potential dilutive effect of non-participating share-based awards. The following table reconciles earnings per common share for the three and nine months ended September30, 2009 and 2008. FortheThree MonthsEnded FortheNine MonthsEnded September30, 2009 September30, 2008 September30, 2009 September30, 2008 BASIC Net income $ 229,842 $ 238,098 $ 200,325 $ 203,235 Less net income allocable to participating RSUs (2,718 ) (2,510 ) (2,227 ) (1,921 ) Net income available for basic common shares $ 227,124 $ 235,588 $ 198,098 $ 201,314 Weighted average common shares outstanding 360,843 360,881 359,513 361,339 Basic net income per common share $ 0.63 $ 0.65 $ 0.55 $ 0.56 DILUTED Net income $ 229,842 $ 238,098 $ 200,325 $ 203,235 Less net income allocable to participating RSUs (2,710 ) (2,504 ) (2,222 ) (1,915 ) Net income available for diluted common shares $ 227,132 $ 235,594 $ 198,103 $ 201,320 Weighted average common shares outstanding 360,843 360,881 359,513 361,339 Weighted average common equivalent shares arising from:

21.Employee Benefit Plans

21.Employee Benefit Plans
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
21.Employee Benefit Plans	21. Employee Benefit Plans Mattel and certain of its subsidiaries have qualified and nonqualified retirement plans covering substantially all employees of these companies, which are more fully described in Note 7 to the Consolidated Financial Statements in its 2008 Annual Report on Form 10-K. A summary of the components of net periodic benefit cost for Mattels defined benefit pension plans is as follows: FortheThreeMonthsEnded FortheNineMonthsEnded September30,2009 September30,2008 September30,2009 September30,2008 (In thousands) Service cost $ 3,124 $ 2,816 $ 9,037 $ 9,162 Interest cost 8,700 6,483 23,865 19,669 Expected return on plan assets (7,782 ) (6,606 ) (22,636 ) (20,072 ) Amortization of prior service cost 557 438 1,301 1,394 Recognized actuarial loss 3,248 1,446 9,307 4,445 $ 7,847 $ 4,577 $ 20,874 $ 14,598 A summary of the components of net periodic benefit cost for Mattels postretirement benefit plans is as follows: FortheThreeMonthsEnded FortheNineMonthsEnded September30,2009 September30,2008 September30,2009 September30,2008 (In thousands) Service cost $ 9 $ 27 $ 62 $ 75 Interest cost 368 664 1,696 2,098 Recognized actuarial (gain) loss (175 ) 126 178 384 $ 202 $ 817 $ 1,936 $ 2,557 During the three and nine months ended September30, 2009, Mattel made cash contributions totaling approximately $20 million and $31 million, respectively, to its defined benefit pension and postretirement benefit plans.

22.Share-Based Payments

22.Share-Based Payments
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
22.Share-Based Payments	22. Share-Based Payments Mattel has various stock compensation plans, which are more fully described in Note 10 to the Consolidated Financial Statements in its 2008 Annual Report on Form 10-K. Under the Mattel, Inc. 2005 Equity Compensation Plan (the 2005 Plan), Mattel has the ability to grant nonqualified stock options, incentive stock options, stock appreciation rights, restricted stock, RSUs, dividend equivalent rights, and shares of common stock to officers, employees, and other persons providing services to Mattel. Stock options expire no later than ten years from the date of grant and both stock options and RSUs generally provide for vesting over a period of three years from the date of grant. Such stock options under the 2005 Plan were granted with exercise prices at or above the fair market value of Mattels common stock on the applicable measurement dates. Compensation expense, included within other selling and administrative expenses, related to stock options and RSUs is as follows: FortheThreeMonthsEnded FortheNineMonthsEnded September30,2009 September30,2008 September30,2009 September30,2008 (In thousands) Stock option compensation expense $ 3,931 $ 3,283 $ 8,726 $ 5,644 RSU compensation expense 10,954 8,384 26,304 19,445 $ 14,885 $ 11,667 $ 35,030 $ 25,089 During the three and nine months ended September30, 2009, Mattel recognized compensation expense of $2.0 million and $3.0 million, respectively, which is included in the RSU compensation expense amounts noted above, for performance RSUs granted in connection with its January1, 2008 December31, 2010 Long Term Incentive Plan, which is more fully described in Note 7 to the Consolidated Financial Statements in its 2008 Annual Report on Form 10-K. As of September30, 2009, total unrecognized compensation cost related to unvested share-based payments totaled $83.4 million and is expected to be recognized over a weighted-average period of 2.2 years. Mattel uses treasury shares purchased under its share repurchase program to satisfy stock option exercises and the vesting of RSUs. Cash received for stock option exercises for the nine months ended September30, 2009 and 2008 was $20.6million and $18.3million, respectively.

23.Contingencies

23.Contingencies
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
23.Contingencies	23. Contingencies With regard to the claims against Mattel described below, Mattel intends to defend itself vigorously. Except as described in Note 8, Product Recalls and Withdrawals, management cannot reasonably determine the scope or amount of possible liabilities that could result from an unfavorable settlement or resolution of these claims, and no reserves for these claims have been established as of September30, 2009. However, it is possible that an unfavorable resolution of these claims could have a material adverse effect on Mattels financial condition and results of operations, and there can be no assurance that Mattel will be able to achieve a favorable settlement or resolution of these claims. Litigation Related to Carter Bryant and MGA Entertainment, Inc. In April 2004, Mattel filed a lawsuit in Los Angeles County Superior Court against Carter Bryant (Bryant), a former Mattel design employee. The suit alleges that Bryant aided and assisted a Mattel competitor, MGA Entertainment, Inc. (MGA), during the time he was employed by Mattel, in violation of his contractual and other duties to Mattel. In September 2004, Bryant asserted counterclaims against Mattel, including counterclaims in which Bryant sought, as a putative class action representative, to invalidate Mattels Confidential Information and Proprietary Inventions Agreements with its employees. Bryant also removed Mattels suit to the United States District Court for the Central District of California. In December 2004, MGA intervened as a party-defendant in Mattels action against Bryant, asserting that its rights to Bratz properties are at stake in the litigation. Separately, in November 2004, Bryant filed an action against Mattel in the United States District Court for the Central District of California. The action sought a judicial declaration that Bryants purported conveyance of rights in Bratz was proper and that he did not misappropriate Mattel property in creating Bratz. In April 2005, MGA filed suit against Mattel in the United States District Court for the Central District of California. MGAs action alleges claims of trade dress infringement, trade dress dilution, false designation of origin, unfair competition, and unjust enrichment. The suit alleges, among other things, that certain products, themes, packaging, and/or television commercials in various Mattel product lines have infringed upon products, themes, packaging, and/or television commercials for various MGA product lines, including Bratz. The complaint also asserts that various alleged Mattel acts with respect to unidentified retailers, distributors, and licensees have damaged MGA and that various alleged acts by industry organizations, purportedly induced by Mattel, have damaged MGA. MGAs suit alleges that MGA has been damaged in an amount believed to reach or exceed tens of millions of dollars and further seeks punitive damages, disgorgement of Mattels profits and injunctive relief. In June 2006, the three cases were consolidated in the United States District Court for the Central District of California. On July17, 2006, the Court issued an order dismissing all claims that Bryant had a

24.Segment Information

24.Segment Information
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
24.Segment Information	24. Segment Information Mattels operating segments are separately managed business units and are divided on a geographic basis between domestic and international. Mattels domestic operating segments include: Mattel Girls Boys Brandsincluding Barbie fashion dolls and accessories (Barbie), PollyPocket, Little Mommy, Disney Classics, and High School Musical (collectively OtherGirls Brands), Hot Wheels, Matchbox, Speed Racer, and Tyco R/C vehicles and playsets (collectively Wheels), and CARS, Radica, Speed Racer, Batman, and Kung Fu Panda products, and games and puzzles (collectively Entertainment). Fisher-Price Brandsincluding Fisher-Price , Little People, BabyGear, and View-Master (collectively Core Fisher-Price), Sesame Street, Dora the Explorer, Winnie the Pooh, Go-Diego-Go!, and See N Say (collectively Fisher-Price Friends), and Power Wheels . American Girl Brandsincluding Just Like You, the historical collection, and Bitty Baby. American Girl Brands products are sold directly to consumers via its catalogue, website, and proprietary retail stores. Its childrens publications are also sold to certain retailers. Additionally, the International segment sells products in all toy categories, except American Girl Brands. The following tables present information about revenues, income (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). 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, Mattels chief operating decision maker uses gross sales by segment as one of the metrics to measure segment performance. Such sales adjustments are included in the determination of segment income (loss) from operations based on the adjustments recorded in the financial accounting systems. Segment income (loss) from operations represents operating income (loss), while consolidated income from operations represents income from operations before income taxes as reported in the consolidated statements of operations. The corporate and other category includes costs not allocated to individual segments, including charges related to incentive compensation, share-based payments, and corporate headquarters functions managed on a worldwide basis, and the impact of changes in foreign currency rates on intercompany transactions. FortheThreeMonthsEnded FortheNineMonthsEnded September30,2009 September30, 2008 September30,2009 September30,2008 (In thousands) Revenues Domestic: Mattel Girls Boys Brands US $ 474,785 $ 470,869 $ 908,382 $ 957,356 Fisher-Price Brands US 496,458 529,490 882,558 956,102 American Girl Brands 82,380 78,840 209,850 209,011 Total Domestic 1,053,623 1,079,199 2,000,790 2,122,469 International 902,285 1,049,188 1,787,29

25.New Accounting Pronouncement

25.New Accounting Pronouncements
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
25.New Accounting Pronouncements	25. New Accounting Pronouncements The following recently issued but not yet enacted accounting standards have not yet been codified by the FASB, as described in Note 1, Basis of Presentation. In December 2008, the FASB issued FSP No. FAS 132(R)-1, Employers Disclosures about Postretirement Benefit Plan Assets. FSP No. FAS 132(R)-1 amends SFAS No.132(R), Employers Disclosures about Pensions and Other Postretirement Benefits, to require additional disclosures about plan assets held in an employers defined benefit pension or other postretirement plan, to provide users of financial statements with an understanding of (i)how investment allocation decisions are made, including the factors that are pertinent to an understanding of investment policies and strategies, (ii)the major categories of plan assets, (iii)the inputs and valuation techniques used to measure the fair value of plan assets including the level within the fair value hierarchy, using the guidance in SFAS No.157, and (iv)significant concentrations of risk within plan assets. FSP No. FAS 132(R)-1 is effective for financial statements issued for fiscal years ending after December15, 2009. Mattel does not expect the adoption of FSP No. FAS 132(R)-1 to have a material effect on its consolidated financial statements. In June 2009, the FASB issued SFASNo.166, Accounting for Transfers of Financial Assetsan amendment of FASB Statement No.140. SFASNo. 166 amends SFAS No.140, Accounting for the Transfers and Servicing of Financial Assets and the Extinguishments of Liabilities, and seeks to improve the relevance and comparability of the information that a reporting entity provides in its financial statements about transfers of financial assets; the effects of the transfer on its financial position, financial performance, and cash flows; and a transferors continuing involvement, if any, in transferred financial assets. SFASNo. 166 eliminates the concept of a qualifying special-purpose entity, creates more stringent conditions for reporting a transfer of a portion of a financial asset as a sale, clarifies other sale-accounting criteria, and changes the initial measurement of a transferors interest in transferred financial assets. SFAS No.166 is effective for interim and annual reporting periods beginning after November15, 2009. Mattel does not expect the adoption of SFAS No.166 to have a material impact on its consolidated financial statements. In June 2009, the FASB issued SFAS No.167, Amendments to FASB Interpretation No.46(R). SFAS No.167 amends FASB Interpretation No. (FIN) 46, Consolidation of Variable Interest Entities (revised December 2003)an interpretation of ARB No.51, which requires an enterprise to determine whether its variable interest or interests give it a controlling financial interest in a variable interest entity. The primary beneficiary of a variable interest entity is the enterprise that has both (1)the power to direct the activities of a variable interest entity that most significantly impact the entitys economic performance, and (2)the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the rig

Document Information

Document Information
	9 Months Ended Sep. 30, 2009 USD / shares
Document Information [Text Block]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2009-09-30

Entity Information

Entity Information (USD $)
	9 Months Ended Sep. 30, 2009	Oct. 23, 2009
Entity [Text Block]
Trading Symbol	MAT
Entity Registrant Name	MATTEL INC /DE/
Entity Central Index Key	0000063276
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		361,480,253