Second-quarter profit fell about 22 per cent as production costs offset higher sales, sending shares down nearly 17 per cent.
The firm posted second-quarter net income of $5 million down from $6.4 million a year earlier. Quarterly sales rose 4.4 percent to $129.5 million from a year ago helped by strong sales of its World Wrestling Entertainment action figures, Pokemon toys and Disney role play items.
Sales from traditional toys, which include action figures, vehicles, electronics, and role play, stood at $108.6 million for the quarter, representing 83.9 percent of overall sales.
"We did see lower-than-expected sales in a couple of our lines, including Doodle Bear, and some shipping delayed for a few of our new Hannah Montana and XPV items that pushed some sales into the third quarter," Chief financial officer Joel Bennett said.