(Bloomberg) -- Mattel Inc. sank the most in six weeks after another shake-up at the top of the toymaker, with Executive Chairman Ynon Kreiz replacing Chief Executive Officer Margo Georgiadis, who stepped into the role just 14 months ago.
Georgiadis is leaving to become CEO of genealogy-research company Ancestry. She will stay on in an advisory role at Mattel though May 10, the company said Thursday in a statement. Kreiz, who joined the board last year and was already slated to become chairman, will still stand for election for that position on May 17.
“Ynon has excelled at anticipating industry trends and brings an outstanding track record of innovation and success,” outgoing Chairman Chris Sinclair said in the statement.
Mattel shares fell as much as 9.2 percent to $12.21 in New York Friday, the biggest intraday decline since March 9. They had already been down 13 percent this year through Thursday’s close.
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Struggling to break out of a deep funk, Mattel has killed off entire product lines and aggressively cleared out inventory. In adopting this approach, Georgiadis opted for short-term pain in order to put the company on better footing. She also pledged to make Mattel more focused on experiences and technology as consumers move away from plastic toys.
But the company’s shares have lost almost half their value since she took the reins in February 2017, with Mattel losing ground to rival Hasbro Inc. The bankruptcy and subsequent liquidation of Toys “R” Us, which was the largest toy retailer and a top channel for Mattel sales, was another blow to the company.
There are some indications Georgiadis’s changes were beginning to pay off: Barbie, one of Mattel’s most important franchises, posted a 9 percent sales gain in the fourth quarter. But other products haven’t experienced the same success.
“Mattel right now is set up better than it has been in the last five or six years,” said Jim Silver, an industry analyst and founder of review site TTPM.com, said.
At the same time, Kreiz is a known commodity in the entertainment world, he said. Hasbro has experienced more success in tying its merchandise to movies and TV shows -- a move Mattel may now be looking to accelerate.
“In the entertainment world, he’s connected to everybody and he’s a deal maker,” Silver said. “He’s known as a person who gets things done.”
At Ancestry, Georgiadis will succeed Howard Hochhauser, who has served as interim CEO since October 2017. The Wall Street Journal earlier reported Georgiadis’s departure.
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