Mattel Inc's Business Segments

Mattel, Inc. ('Mattel') designs, manufactures, and markets a broad variety of toy products worldwide through sales to retailers and directly to consumers. Mattel's vision is: The World's Premier Toy Brands'Today and Tomorrow. Management has set five key company strategies: (1) improve execution of the existing toy business; (2) globalize the brands; (3) extend the brands; (4) catch new trends; and (5) develop people.

Domestic Segment

The Domestic segment develops toys that it markets and sells in the Mattel Brands US, Fisher-Price Brands US and American Girl Brands segments.

In the Mattel Brands US segment, Barbie' includes brands such as Barbie' fashion dolls and accessories, My Scene', and Barbie' Collector. Polly Pocket!' and ello' are included within Other Girls Brands. Wheels is comprised of Hot Wheels', Matchbox', and Tyco' R/C. Entertainment includes Nickelodeon', Harry Potter', Yu-Gi-Oh!', He-Man' and Masters of the Universe', Batman' and Justice League' products, as well as games and puzzles.

In 2004, Mattel expects to expand its existing products or introduce new products, including a new 'worlds of' strategy within the Barbie' brand. Among the 'worlds' are Fairytopia', Happy Family', and Cali Girl'. In addition, Barbie' as The Princess and the Pauper will be the fourth in a series of videos and entertainment-themed fashion dolls. Other new products include Polly Pocket!' Par-tay Bus', ello' Shopopolis', Little Mommy' and Shorties. Hot Wheels' will introduce Formula Fuelers', Incredible Crash Dummies' and Slimecano' playset. In Entertainment, Winx' and the newest game, Scene It'', a video trivia game, will also be available in 2004.

The Fisher-Price Brands US segment includes Fisher-Price', Power Wheels', Sesame Street', Little People', Disney preschool and plush, Winnie the Pooh, Rescue Heroes', Barney', See 'N Say', Dora the Explorer', PowerTouch' and View-Master' brands. Mattel plans to expand its interactive learning toys category, including introduction in 2004 of new toys designed specifically for children at different developmental stages, from infancy through grade school. New product introductions for 2004 are expected to include InteracTV', POP-ONZ' jr. building system, Laugh and Learn' Home, Rescue Heroes' Robotz, Doodle Pro', First Steps' Pooh, Dora's Talking Dollhouse', ESPN' Game Station' and a new Elmo plush doll that sings a variation of the Village People song 'YMCA'.

The American Girl Brands segment is a direct marketer, children's publisher and retailer that includes the following brands: The American Girls Collection', American Girl Today', Hopscotch Hill School', Bitty Baby', Angelina Ballerina', and Girls of Many Lands'. American Girl Brands also publishes best-selling books from American Girl Library', History Mysteries', Amelia', Wild at Heart', and AG Fiction', as well as the award-winning American Girl' magazine. In 2004, American Girl Brands, in association with Warner Bros., is creating a made-for-TV movie scheduled to air in the fall of 2004 featuring Samantha Parkington', a classic American Girl character. Movie-related product launches include a new 18-inch historical doll and book based on Nellie', Samantha's best friend from the movie, as well as several special-edition movie outfits and accessories for dolls and girls. Other 2004 product introductions include a new 16-inch doll and book character for Hopscotch Hill School', brunette Bitty Twins', numerous advice and activity books, outfits and accessories for the American Girl Today' dolls and Coconut' the Puppy. American Girl Brands products are sold only in the US and Canada.

International Segment

Products marketed by the International segment, with the exception of American Girl Brands, are generally the same as those developed and marketed by the Domestic segment, although some are developed or adapted for particular international markets. Mattel's products are sold directly to retailers and wholesalers in Canada and most European, Asian and Latin American countries, and through agents and distributors in those countries where Mattel has no direct presence.