Barbie movie is 'a showcase for the quality of the movies we're looking to make,' Mattel CEO says

Mattel CEO Ynon Kreiz sits down with Yahoo Finance Executive Editor Brian Sozzi at The Milken Institute Global Conference to discuss the state of the toy industry, the release of the upcoming "Barbie" movie, a licensing deal on "Frozen" characters with Disney, and future projects in development.

Video transcript

- Toymaker Mattel trading down a little, over 1% here since the start of the year. The toy industry overall has seen inventory challenges amid a larger slowdown. But looking ahead there could be a number of potential catalysts. Now that includes a licensing partnership with rival Hasbro. We'll get a Barbie edition Monopoly game out of that union.

Speaking of Barbie, the hotly anticipated Barbie movie is out in theaters this summer, July 21. Let's head back to the Milken Conference out in California. Yahoo Finance's Brian Sozzi sitting down with the CEO of Mattel, Brian.

BRIAN SOZZI: All right, thanks so much, Seana. Yes, joining me now Mattel CEO, Ynon Kreiz. Good to see you in person for a change, Ynon Kreiz.

YNON KREIZ: Good to see you too, Brian.

BRIAN SOZZI: So the mood here at the conference, I wouldn't say gloomy but a little bit of realistic. Everybody's acknowledging an economic slowdown. You're fresh off of your earnings report. How has this slowdown impacted toy demand?

YNON KREIZ: Well, from where we sit, we saw a decline in-- the point is, we're in the first quarter. But we do expect the industry to be flat, to slightly up. And for Mattel we saw increase in consumer demand for our product. In fact, we grew consumer demand in all of our leader category, dolls, vehicles, infant, toddler, and preschool, as well as in action figures and building sets. So we saw growth and we expect that growth to be positive for the full year as well.

BRIAN SOZZI: Do you already have visibility into the holiday shopping season? Is that why you're so confident in the second half of the year?

YNON KREIZ: It's so early to tell how the holiday season will shape up. But we have some meaningful drivers for Mattel for the full year. From the launch of Disney Princess and Frozen, which is added to our dolls portfolio, Trolls, Wish, two big movies that will launch the second part of the year. The global rollout of Monster High. And of course, the release of the Barbie movie in July that will be a catalyst. So we have a few incremental new drivers for our business in 2023.

BRIAN SOZZI: Well, I'm going to make people wait, viewers wait to talk more about that Barbie movie, because I know they're very excited about. But that Disney, that Frozen license. How big is that for Mattel this year? Sales wise?

YNON KREIZ: It's important and it's meaningful, both culturally as well as a business opportunity. We really believe it will be a win-win situation for Mattel and Disney. And we can grow this franchise and leverage our capability and leadership position in the dolls category in a meaningful way.

BRIAN SOZZI: The writers strike that we're looking at in Hollywood, does that impact your business at all in terms of movies getting out, content being produced, impacting the toy business?

YNON KREIZ: It will not impact, of course, the Barbie movie, which is out soon. But we're looking to see how it will impact the rest of the business. Of course, we have multiple projects in the making. Some are relatively advanced than others, and we'll have to continue to watch this space and make sure that we manage it properly.

BRIAN SOZZI: I still feel as though investors don't understand what you're doing on the content front. So let's take them through it. How many pieces of content did you have in development over the next two years? And what are some of the big names outside of the Barbie movie?

YNON KREIZ: Well, we announced 14 projects in development. We have Hot Wheels as a project with JJ Abrams to produce at Warner Brothers, Matchbox, which is being developed by Skydance. We have a Rock 'Em Sock 'Em Robots with Vin Diesel and Universal. We have a Major Matt Mason that we're developing with Tom Hanks and Akiva Goldsman as a writer. We have a Barney movie in development, Masters of the Universe.

BRIAN SOZZI: Barney?

YNON KREIZ: Barney. With Daniel Kaluuya, we announced that. We have a Thomas the Tank as a film in development. We have several projects in the making. And you can see that the diversity by genre, by audience demographic, by type, and each project is very different, which is exciting. Because we really have an opportunity to capture value from our intellectual properties outside of the toy aisle. And this is obviously not just the Barbie movie, but multiple projects, different partners, all quality focus on quality of this project. This is not just to sell toys, but really to participate in the film business right at center stage with the best talent in the industry.

BRIAN SOZZI: Let's get to Barbie. July 21. How big of an event is this for a company like Mattel?

YNON KREIZ: We really believe this will be an event, not just for Mattel, but we believe it will have an impact broader than that. And this is about franchise management. This is not just about one quarter or about one year. This is how you manage a franchise. And this film is really being developed by one of the most creative and prolific filmmaker of our generation, with Greta Gerwig, who co-wrote it with Noah Baumbach. She's directing. We have an incredible cast led by Margot Robbie and Ryan Gosling. Will Ferrell and other top lead talent. We're very excited about it. But this is not just about the quarter. And this is the first of an exciting film slate that we're pointing out, as I mentioned before.

BRIAN SOZZI: I think this was mentioned on the last earnings call just a couple of days ago. You said this movie was a legacy making moment for Mattel. Explain that to us.

YNON KREIZ: Yeah this is the first time that Mattel is putting a movie out based on any of our IPs, any of our franchise. Barbie is clearly an important brand. It's one of our three power brands. And it will be in many ways a showcase for the quality of the movies that we're looking to make, the type of partnerships we're formulating with lead talent in Hollywood, working with major studios. And of course amplifying the brand in the movie through our own marketing capabilities, and social reach and engagement. So it will be a way for us to show, what does it mean when we say that we, Mattel, is an IP driven high performing toy company, and an opportunity to extend our business outside of everything we do on the toy side of the company.

BRIAN SOZZI: Speaking of partnerships, you just signed a partnership with Hasbro. Now, when I saw this news cross, Ynon, I thought this was like Apple and Google joining forces to make some piece of new hardware. Take us through this deal, because I don't think a lot of people even saw this coming.

YNON KREIZ: This is a cross-licensing agreement where we are integrating Transformers into Hot Wheels and Uno, and Monopoly is integrating Barbie into its play. Now, we do that with other parties as well. We do it with other toy companies.

BRIAN SOZZI: This is a Hasbro!

YNON KREIZ: Clearly, this is the first time it happened. And it's really going to be a case where we both went from this partnership, but the real winner is the consumer. The fans that will have more ways to engage and interact with their favorite brands.

BRIAN SOZZI: Is there more to come on the Hasbro, Mattel front?

YNON KREIZ: At this point this is the partnership we agreed on. But we constantly look to innovate and partner and collaborate with parties that where we have an opportunity to create something unique and exciting.

BRIAN SOZZI: Lastly before we let you go, I followed your transformation journey in Mattel. Everything you've done. What's next for you? And what's next for Mattel over the next year?

YNON KREIZ: Yeah, it has been an exciting journey. Just a few days ago we reached investment grade rating. This was a milestone moment for the company. Capping a five year journey of taking the company from a negative more than 200 million operating income loss, adjusted operating income loss, to positive $689 million of adjusted operating income. So financially it's been a transformative period for the company, and we believe there's so much more to come, both on the toy side of the company and everything we do on the IP side of the company, the entertainment side of the company. In film, television, licensing and merchandise, consumer product, and of course, digital experiences. So we believe we are still on an exciting journey with a lot more to come.

BRIAN SOZZI: All right, we'll leave it there. Mattel chairman and CEO Ynon Kreiz, good to see you and July 21 I will be at that Barbie movie. Definitely seeing it. And I will be sending you a photo. Ynon, good to see you in person.

YNON KREIZ: Thank you.