Mattel Loses Licensing Rights To Some DC Comics Toys

Although this time of year is typically known as the season of giving, one toy company, in particular, isn't having a very merry Christmas. According to a report from the Los Angeles Times, the toy giant has lost their licensing rights a chunk of DC Comics offerings.

Once their current deal expires in 2020, Mattel will no longer be able to produce boy's action toys, remote control and robotic vehicles, water toys and games, or puzzles featuring the likeness of DC Comics characters. Beginning in the Spring of 2020, the licensing of those categories has been awarded to the Toronto-based Spin Master Corp.

A smaller toy company — at least when compared to giants like Mattel or Hasbro — Spin Master is about to launch an official line of Monster Jam trucks. The company was recently named atop the list of Licensing category in Kidscreen's "2018 Hot 50 Companies" list.

"Partnering with an iconic brand like DC is a major milestone for Spin Master and is part of our strategy to invest in successful licenses to further grow and diversify our business," says Ben Gadbois, Spin Master COO in a statement. "Children everywhere have been entertained and inspired by DC Super Heroes™ and Super-Villains™ for more than 80 years and we're honoured to be a part of that storytelling and imagined play. We are looking forward to bringing Spin Master's renowned innovation to the toy line and to sharing more details about this exciting partnership in the new year."

Last year, Spin Master reported $1.553 billion in revenue while Mattel made north of $4.88b. Hasbro dwarfed both companies by hauling in $5.21b in 2017.

Amidst the news of the major license loss, shares of Mattel ($MAT) dropped significantly. Already performing at an 18-year low, Mattel shares dropped an additional 4.5 percent at the end of business on Monday. Mattel stock has a 40-percent year-to-day loss.

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All is not lost for Mattel, who will remain a license holder of DC Comics' preschool and girls' toys, which includes the budding "Super Hero Girls" line.

According to Goldman Sachs analyst Michael Ng, the investment bank believes Mattel with "aggressively pursue" other licensing options. Ng made sure to point out that fact that Hasbro's license for both Marvel and Star Wars toys ends in 2020, right around the same time Mattel loses their DC Comics' boy's toys licensing.