Marvel Enterprises

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Marvel Enterprises

founded: 1939 variant name: marvel comics

Contact Information:

headquarters: 10 east 40th street
new york, ny 10016 phone: (212)696-4000 fax: (212)576-8598 url:


Marvel Enterprises is best known for the Marvel comic book characters that it has developed for more than half a century. Over the years, characters such as Spiderman, the X-Men, the Incredible Hulk, the Fantastic Four, the Avengers, Daredevil, the Mighty Thor, Captain America, the Submariner, the Silver Surfer, Iron Man, Dr. Strange, and Ghost Rider have become some of the most readily identifiable comic heroes in the world. They have been featured in comic books, TV shows, feature films, and cartoons. They have been reproduced on posters, T-shirts, lunch boxes, and as action figures. By 2001 the Marvel library of characters had reached 4,700 in number. The primary vehicle for these characters is Marvel's line of comic books, which are sold throughout the United States and the world. The primary markets for Marvel comics are people between the ages of 13 and 35, some of whom simply buy the comics to read, others who also purchase the comics as collectible goods. Marvel's toy line is aimed at the global pre-teen market.

Marvel Enterprises is divided into three business units. Marvel Licensing, MARVEL Publishing and Toy Biz. The Toy Biz division designs, develops, manufacturers, markets and distributes toys. Its primary products are the action figures based on Marvel comic book characters and the characters in movies such as Lord of the Rings. Toy Biz includes the Spectra Star division, which produces and sells kites. Marvel Licensing licenses Marvel's various comic characters for use in a variety of products, including TV shows, feature films, cartoons, theme parks, toys, games, clothing, Web sites, and other computer media. A noteworthy licensing coup was the X-Men characters produced by Twentieth Century Fox in 2000. The final unit, Marvel Publishing, develops and produces comic books.


Marvel's customer base varies from product line to product line. Its comic books are directed primarily at consumers between the ages of 13 and 35. They are sold via three channels. The first, the "direct market," consists of stores that specialize in comic books. Marvel sells its products to them on a non-returnable basis. In 2001, about 80 percent of Marvel's comic book sales were made to the direct market. The second channel consists of traditional retail stores that stock magazines and other periodicals. They include newsstands, drug stores, supermarkets, and bookstores. Marvel distributes its publications to this market on a returnable basis—any books left unsold after a certain period of time can be returned to Marvel for credit. The retail returnable market accounted for 8 percent of Marvel's book sales in 2001. The third channel is subscriptions, which were responsible for 3 percent of comic sales in 2001.

Marvel sells its toy products primarily through retail stores. Its largest customers in 2001 were Toys 'R' Us Inc., Wal-Mart Stores Inc., Kmart Corporation, Target Stores Inc., and Kay-Bee Toy Stores. These chains together accounted for 56 percent of Marvel Enterprise's toy sales in 2001. About 77 percent of the company's sales were made in the United States. In 2001 about three-quarters of Marvel's toys were not based on Marvel characters. The company expected this percentage to drop in 2002 as it prepared a line of toys to coincide with the release of the Spiderman motion picture.

Marvel Enterprise's experienced a period of growth and decline in the late 1990s and early 2000s. Revenues increased from $150 million in 1997 to $320 million in 1999 and then shrunk to $181 million in 2001. Despite the lull in sales, 2001 saw the company report a profit for the first time in five years. It reported profits of about $5 million, up from a loss of $90 million the previous year. Nonetheless the company's common stock holders took a loss of $0.31 per share.


Although Marvel had begun to turn around its comic book sales through the introduction of more "realistic" subject material, financial observers were still taking a wait-and-see stance toward the firm's future performance. Publishers Weekly pointed out the company's $250 million in bond debt that had not been reduced by sales increases, and the lien on its trademarks and copyrights held by loan-giver Tot Funding. The consensus was that Marvel Enterprises should shed its money-losing toy business and concentrate on realizing the true value of its licensing opportunities. Despite successes such as the X-Men film and the fact that it is one of the largest most popular comic book franchises in the world, the company's licensing record is woeful. "Many a comic book rival, large and small," Forbes wrote, "has proved more adept at exploiting its properties." Forbes went on to blame the company's transformation to a public company for many of Marvel's current problems. Suddenly accountable to stockholders, the company tried to squeeze every drop of profit from every phase of its business, ultimately to its detriment. It increased the number of monthly titles, raised the prices of some books to nearly $5. Forbes observed that the best thing that could happen to Marvel might be another takeover, by Sony for example, who could use the Marvel cast of characters for its Playstation.


Marvel was founded in 1939 after a group of comic book writers and artists persuaded pulp magazine publishers Martin Goodman that comics could be a profitable area of expansion. The creative people, represented by Funnies, Inc., provided the stories and art. Goodman arranged to have them printed and distributed. The arrangement was a success. Goodman's first issues, titled Marvel Comics, were hits. Soon he had formed a new company called Timely Publications that added new titles. By the end of World War II, Timely was publishing a profitable line of comics that featured characters that would become perennial favorites: the Submariner, the Human Torch, and Captain America; as well as humorous comics, comics with animal stories for younger children, and romance comics for teenage girls.

Timely was doing well as the 1950s began. The company changed its name to Atlas Publishing and began handling its own national distribution. However, by the mid-1950s there was a public backlash against the alleged harmful influence of comic books, in particular the horror genre, on young minds. The result was the establishment of the Comics Code Authority, which reviewed comics for appropriateness prior to publication. Safe, homogenized tales that were not nearly as popular among readers replaced the anarchic, often gruesome stories of the early fifties. Marvel's sales took a dive. It cut back its publication schedule and closed its distribution operations. Matters turned finally around in 1961 with the introduction of the Fantastic Four comics. They introduced a formula that would be the mainstay of Marvel for the remainder of the century—stories driven by the frequently maladjusted personalities of their superheroes. They were a hit, and were soon joined by two other social outcasts, the Incredible Hulk and Spiderman. Later in the 1960s the X-Men, the Avengers, and Daredevil were introduced. All Marvel's superheroes inhabited the same world, the so-called Marvel Universe, in which they were able to interact with each other. The comics first bore the name "Marvel Comics" on their covers in 1963.

Marvel's success in the 1960s allowed it to branch out into other media. Cartoons were produced for syndication. The company released other related items such as games and shirts. By 1968 Marvel reported sales figures for 50 comic publications annually. Martin Goodman sold the firm that year to Cadence Industries. His timing was good. The comic book boom was coming to an end. Titles were dropped, and new distribution schemes were tried. One Marvel success was publishing anti-drug issues of Spiderman over the objection of the Comics Code Authority; a move which eventually led to greater openness in comic book storytelling. The business reached new financial lows in the mid-1970s, going $2 million into debt. The 1977 hit TV show, The Incredible Hulk,created some new readers as well as tapping the profits to be made from licensing Marvel's stable of characters. Another favorable trend in the early 1980s was the growth of comic sales to collectors and the rise of specialty stores that sold predominantly comic books. By 1982 these stores made up half of Marvel's sales.

By 1986 Marvel was reporting annual revenues of $100 million and attracted a buyer, New World Pictures. Only two years later, New World sold the firm to the Andrews Group, Inc., for $82.5 million. In 1992 the company made its first stock offering and became a public firm. It also purchased the Fleer Corporation, a maker of trading cards the same year. In 1993 it acquired a 46 percent share of Toy Biz, a company that introduced a successful line of Marvel character action figures. Marvel expanded its publishing schedule in the early 1990s, almost doubling its monthly titles from 1989. By mid-decade Marvel was on the skids once more, and in 1996 it filed for bankruptcy protection. When the dust cleared the firm had been acquired by Toy Biz Inc., Marvel's one-time holding. After the acquisition, Toy Biz changed its name to Marvel Enterprises and made plain its goal to capitalize on Marvel's huge collection of characters. Among the results were the 2001 film X-Men by Twentieth Century Fox and plans with the Sony Corporation for a Spiderman film.


Under CEO, Peter Cuneo, Marvel Enterprises has moved away from toy manufacturing—once the primary activity of the company—and into licensing which is lower risk and potentially more lucrative. A licensing strategy has the added benefit of ultimately creating more exposure for Marvel comic characters which will lead to an increase of comic book sales, and create new opportunities for toy sales . The greatest opportunities for Marvel's licensing efforts lies in the motion picture industry. This was illustrated in May 2002 when the Spiderman-film opened to record box office numbers. In its opening weekend the movie grossed an astounding $114 million dollars. Two sequels to the hit movie are already in the works with a scheduled 2003 release for the next installment.


The release of the movie X-Men at the end of 2000 proved to be a turning point for Marvel's comic book business. The company expected the film to revitalize sales of its X-Mencomics, and possibly other titles as well. To the company's dismay, although the movie was a box office smash, it had virtually no effect at all on comic sales. When it examined its product, it realized that the comic book X-Men had very little to do with the movie X-Men. Some of the characters were different; the uniforms had been changed in the movie from the original comic book outfits; and the stories—in practically all Marvel comics had become too complicated for fans to follow. Fans had to be familiar with 30 to 40 issues in order to follow the story in any particular book. In addition, the basic premises of most Marvel comics remained unchanged from the 1960s and young readers found it harder and harder to relate to the characters. As a result, Marvel re-conceptualized many of the company's most popular characters. For example, Spiderman was transformed from a high school science geek to a brooding teenager with an interest in computers. The new stories have been published under the banner of Ultimate Spider-Man. That, and the revamped Ultimate X-Men were Marvel's most popular comic titles in late 2001, with increased sales 500 to 600 percent each, compared with increases of around 30 percent for other titles.

FAST FACTS: About Marvel Enterprises

Ownership: Marvel Enterprises is a publicly owned company traded on the New York Stock Exchange.

Ticker Symbol: MVL

Officers: F. Peter Cuneo, Pres. and CEO, 57, 2001 base salary $750,000; Avi Arad, Chief Creative Officer and CEO of Marvel Studios, 54, 2001 base salary $450,000; Alan Fine, Pres. and CEO of Toy Biz Inc., 51, 2001 base salary $500,192

Employees: 500

Principal Subsidiary Companies: Marvel Enterprises is an entertainment company that publishes comic book, manufactures toys, and licenses its products. Marvel is headquartered in New York City and has office and manufacturing facilities in Arizona, Washington State, California, and Mexico. The company's Marvel Publishing division produces the famous line of Marvel comics which include characters such as Spiderman, the X-Men, Captain America, the Incredible Hulk, and the Fantastic Four.

Chief Competitors: Marvel Enterprises has a number of competitors in the toy and comic book industries. Some primary competitors are: DC Comics, Stan Lee Media, Walt Disney, Hasbro, Mattel, and Acclaim Entertainment.


The end of the 1990s and the start of the 2000s saw a general decline in the comic book industry, and readership fell off at a rate of seven to ten percent a month. The trend was exacerbated by the closure of a large number of comic book stores across the United States. In addition fewer of the traditional retail sources of comic books—drug stores, convenience stores, super markets—continue to stock comic books. These factors have made the decade long drop in Marvel comic book sales even more serious. The company hopes reverse this trend with the development of new story-lines in its most popular books and the regular publication of collections of older stories in trade paperback "graphic novels" that tell a complete self-contained story.


In addition to completely revamped versions of its most successful and revered series, Marvel introduced other products which proved a hit with comic fans. One new product is a series of trade paperback "graphic novels," each containing reprinted stories. The trade book line was an alternative to reprinting comic books when they were sold out during their first release. This new format increased their value as collectibles and increased demand for the initial print run. In fall 2001, Marvel introduced a program to print twelve graphic novels a month. Another innovative product is the free sample stories that Marvel offers for downloading on its Web site to attract new readers to the Marvel universe.


Foreign markets accounted for more than 20 percent of Marvel Enterprise's sales in 2001. Marvel maintains an office in Hong Kong, which oversees the production of toys in the People's Republic of China. It also has a Hong Kong subsidiary, which sells the company's products in markets outside the United States. A subsidiary in Mexico, Compania de Juguetes Mexicanos. S.A. de C.V., manufactures kites for Spectra Star.

CHRONOLOGY: Key Dates for Marvel Enterprises


Martin Goodman publishes the first issue of Marvel Comics and founds Timely Publications


Captain America is introduced


Timely Publications renamed Atlas News Company


The Fantastic Four first appear, followed soon afterwards by Spiderman and the Incredible Hulk


"Marvel Comics Group" appears on Marvel comics for the first time


Marvel Super Heroes cartoon series first appears on TV


Martin Goodman sells Marvel to Cadence Industries


Marvel publishes the first Giant Size X-Men


The Incredible Hulk TV series debuts


Marvel sold to New World Pictures


Marvel sold to Andrews Group, Inc.


Marvel makes its first public stock offering


Marvel acquired Fleer Corporation


Marvel files bankruptcy


Marvel acquired by Toy Biz, Inc.


Twentieth Century Fox releases film X-Men


As his new superheroes were battling foes in the Marvel universe, Martin Goodman was becoming concerned about more serious threats in the real world. Nazi Germany had invaded Poland around the time he was forming his comic book empire. For the first two years of World War II the United States maintained a careful neutrality. Marvel, on the other hand, was fighting hard for the Allies. In February 1940 the Submariner single-handedly captured a Nazi U-boat. Just a year later, Captain America hit the scene, a hero whose specialty was battling Hitler. His comics were a resounding success—the premier issue sold an amazing one million copies. Nine months later, the rest of the United States entered the war against Germany, and three and a half years later, Hitler was defeated.


Marvel Enterprises has a full-time staff of about 500 employees. This include editorial staff at Marvel Publishing and production and development staff in the Toy Biz division. In addition, Marvel employs a contingent of approximately 500 freelancers. Toy Biz works with freelance toy inventors; Marvel Publishing relies on an army of freelance writers, pencil artists, inkers, and colorists. Much of the actual work on each Marvel comic book takes place outside Marvel's own facilities. Free-lancers are paid on a per page basis. They may also qualify for a percentage of issues sold.



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For an annual report:

write: marvel enterprises, 10 east 40th street, new york, ny 10016

For additional industry research:

investigate companies by their standard industrial classification codes, also known as sics. marvel enterprises' primary sics are:

2721 periodicals publishing & printing

2731 book publishing & printing

3944 games, toys, and children's vehicles

also investigate companies by their north american industrial classification system codes, also known as naics codes. marvel enterprises' primary naics codes are:

339932 game, toy, and children's vehicle manufacturing

339999 all other miscellaneous manufacturing