Mattel Heads For Gloomy Holiday Season Sales After Reporting Weak 3Q Results

El Segundo, Calif., (AHN) - Mattel, Inc. (NYSE: MAT) reported third quarter earnings results, which missed expectations, as the company struggles through tough consumer spending period ahead of holiday season.

The market analysts have already projected that the retail industry is likely to suffer due to weak holiday season sales due to tight consumer spending, rising unemployment rate, slumping housing market condition and declining credit market.

The world's largest toy retailer reported net income of $238.1 million, or $0.66 per share, compared to last year's third quarter net income of $236.8 million, or $0.61 per share.

The market analysts on Wall Street expected the firm to post a profit of 71 cents per share.

The company's net sales were $1.95 billion, up 6 percent compared to $1.84 billion last year, including favorable changes in currency exchange rates of 2 percentage points.

The third quarter gross sales increased 4 percent in the U.S. and increased 7 percent in international markets, the company said in the report.

Operating income for the quarter was $315.3 million, compared to operating income of $310.5 million reported a year ago in the same period.

"In light of the recent global economic environment, our business performed well in the quarter," Robert A. Eckert, chairman and chief executive officer of Mattel, said in the statement on Monday.

"The all-important holiday season, however, is ahead of us, and fortunately, we've got some of the industry's hottest toys that deliver terrific play value for both parent and child."

Mattel had raised the prices for toys during the third quarter and reported relatively lower recall-related costs compared with last year.

The company said that it is expected to increase prices again next year after its lower-than-expected third quarter earnings report as well as increasing labor cost in China.

Shares of the El Segundo, California-based maker of Hot Wheels cars and Fisher-Price were trading down by 62 cents or -4.28 percent to $13.83 at 2:46pm ET in New York on Monday.

The firm's dividend yield is 5.42 percent and the stock has traded as low as $13.11 to a high of $23.63 in the last 52 weeks.