Earlier today, toy manufacturer Mattel (MAT) announced that it is teaming up with Microsoft-backed OpenAI (MSFT) in order to bring advanced AI to its toys, movies, TV shows, and games. The partnership will use OpenAI’s tools, including ChatGPT Enterprise, to help design new interactive products and improve how Mattel creates and operates its entertainment content. Furthermore, both companies stated that they will prioritize privacy, safety, and the protection of Mattel’s intellectual property. The first AI-powered product is expected to be announced later this year.
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With this deal, Mattel plans to use AI to create smarter, more interactive toys, new personal assistants based on its well-known characters, and more visually appealing packaging. The technology will also help Mattel design movies and TV shows through its Mattel Studios division, which is focused on bringing brands like Barbie and Barney to the big and small screen. At the same time, Mattel will use AI tools to boost innovation, speed up product development, and improve efficiency across its business.
For OpenAI, this partnership expands its reach into the entertainment and toy industries. It also supports OpenAI’s broader plan to promote its new tools, such as the Sora video generator, which creates short videos from text prompts. Other toy companies have already started using AI for concept art, packaging, logistics, and voice-recognition features in toys like Barbie. Now, with the backing of OpenAI, Mattel is working to stay ahead by creating exciting new ways for children and families to play and interact with its brands.
Is MAT a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MAT stock based on six Buys, two Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average MAT price target of $23.50 per share implies 22.1% upside potential.
