Barbie doll-maker Mattel has a whistle blower

Someone is blowing the whistle on Mattel.

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Shares of the Barbie doll maker plunged more than 10% Friday after the company canceled a $250 million bond sale following its admission that it received an "anonymous whistleblower letter" on Aug. 6.

"To provide Mattel with an opportunity to investigate the matters included in the letter, the offering of our senior notes due 2027 has been terminated," a Mattel spokesperson told FOX Business. The company intends to refinance its senior notes due October 2020 prior to maturity.

Burt Flickinger, managing director at Strategic Resource Group, told FOX Business the whistleblower letter comes at a time when the four cornerstones of Mattel's business are crumbling.

"Its core brands and categories have been in a secular state for decline for decades,” he said. Specifically, Flickinger pointed to continued weakness in Mattel's Barbie and Hot Wheels brands*, and a lack of licensed toys tied to leading children's movies and media.

But, there are some signs of improvement. Barbie doll and Hot Wheels gross sales jumped 9% and 5%, respectively during the second quarter. Mattel also has a Toy Story 4 game, but its sales were not individually broken out.

Flickinger noted the Toys R Us bankruptcy has also weighed on the toymaker as Walmart cannot carry the depth and range of Mattel's products.

In July, Mattel announced a net loss of $108 million, or 31 cents a share. That was better than its year-ago loss of $241 million, or 70 cents a share.

Still, Flickinger thinks the worst is yet to come.

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“This is the beginning of a long decline,” he said.

*This story was updated on 8/13/19 to remove GI Joe as a Mattel brand. The company's second-quarter sales for the listed products were also included.