After last year logging its most robust sales growth in more than a decade, the toy industry is now on pace to do something it hasn't done since 1999: sell enough Barbies, Legos and bouncy balls to lift its sales 7 percent.
During the first half of 2016, toy revenues rose 7.5 percent as compared with the prior-year period, according to data from The NPD Group. That rate of growth outpaced the 6.5 percent lift the industry experienced in the first six months of 2015.
For the full year, the market data firm expects toy sales to rise roughly 7 percent to nearly $21 billion. About two-thirds of toy sales typically occur in the second half of the year.
"Toys with movie tie-ins will continue to contribute to the increase," said Juli Lennett, senior vice president and U.S. toys industry analyst at NPD. Sales of "Star Wars" toys, in particular, rose nearly 200 percent through June, accounting for $300 million. That compares with $700 million for all of 2015, indicating revenues tied to the movie franchise "could be even bigger this year," Lennett said.
Yet the largest boost to the industry's sales through June stemmed from the outdoor and sports toys subcategory, where growth nearly doubled to account for one-third of the overall increase. That subcategory is the largest of all 11 tracked by NPD, accounting for $1.7 billion during the six-month period.
"Some of this explosion in outdoor and sports is a result of millennials seeking a healthier, outdoor lifestyle for their kids," Lennett said.
Investors are responding to the resurgence in the toy industry, which follows several years of disappointing results. Shares of Mattel and Hasbro are each up roughly 20 percent year-to-date, and Jakks Pacific stock is nearly 16 percent higher.