Mattel acquires Mattel163

Mattel has announced the acquisition of Mattel163, a mobile games studio, previously a joint venture with NetEase. The deal involves Mattel taking full ownership by acquiring NetEase’s 50% stake for $159 million, valuing Mattel163 at $318 million. This transaction is set to conclude by the end of the first quarter, subject to standard regulatory conditions, and is expected to be immediately accretive for Mattel.

Mattel163, established in 2018, has developed mobile games featuring Mattel’s well-known brands, such as Barbie and Hot Wheels. With an impressive portfolio, the studio has released four titles that have collectively garnered over 550 million downloads and maintain about 20 million monthly active users. The acquisition will be financed primarily through Mattel’s share of the joint venture’s cash holdings, which are not presently reflected on the company’s balance sheet.

This acquisition aims to bolster Mattel's digital capabilities by integrating Mattel163’s expertise in game development, publishing, and digital customer acquisition directly with its existing operations. By doing so, Mattel plans to ramp up its mobile game production and better synchronise these products with its extensive range of physical toys. The move is designed to capture more value from Mattel’s intellectual property through digital channels, enhancing its standing in the high-margin digital entertainment market.

The acquisition is part of Mattel’s broader digital strategy, which rests on three key pillars: collaborating with global partners like Take-Two and Apple Arcade, engaging in self-publishing with new titles anticipated in 2026, and expanding presence on platforms like Roblox and Fortnite. By gaining full control of Mattel163, Mattel intends to improve its performance marketing and cross-promotion capabilities, while aligning digital offerings with larger brand marketing initiatives.

Going forward, the transaction is expected to clear customary closing conditions before finalization. Mattel's move towards a more digital-centric strategy reflects a significant industry shift as traditional toy companies increasingly emphasize digital platforms to capture attention in the evolving entertainment landscape. As competitors modernize their portfolios to align with consumer trends, Mattel’s approach could provide a roadmap for leveraging iconic brands in the digital arena.