Mattel (MAT) stock surged 5.89% in Tuesday's trading session, as investors reacted positively to the company's better-than-expected first-quarter results and its strategies to navigate potential tariff impacts.

The toy manufacturer reported a narrower-than-anticipated loss for Q1, with revenue rising 2% to $826.6 million, significantly surpassing analyst expectations of $791.5 million. Mattel's adjusted loss per share of $0.03 also beat estimates of a $0.10 loss, demonstrating the company's resilience in a challenging economic environment.

In response to evolving trade tensions, Mattel announced plans to raise prices in the United States "where necessary" and reduce its reliance on China for production. The company aims to lower its U.S. imports from China to less than 15% of global production by next year and less than 10% by 2027, showcasing its proactive approach to supply chain diversification.

Analysts view Mattel's positioning favorably, with UBS Securities stating that the company is "better than expected" to navigate the full impact of tariffs this year. UBS highlighted Mattel's capacity to "provide uninterrupted supply" as a key advantage, potentially allowing it to gain incremental shelf space in the 2025 holiday season.

While Mattel has paused its full-year guidance due to uncertainties surrounding consumer spending and the evolving tariff landscape, investors appear confident in the company's ability to adapt to market challenges. The stock's significant rise reflects optimism about Mattel's strategic initiatives and its potential to outperform in the face of industry headwinds.