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Toy maker Mattel Inc. reported its first quarterly revenue increase in more than two years as sales of its iconic Barbie notched a rare increase, driving profit up in the key holiday quarter.

Shares jumped 7.8% to $28.85 in recent after-hours trading Monday.

Among its core brands, Barbie reported a 1% increase in gross sales, compared with a 12% decline a year ago—and the first increase in world-wide sales since the third quarter of 2013.

The results come days after the toy maker, the world's largest by sales, announced another makeover to the Barbie doll, which now will come in three sizes: curvy, petite and tall.

The doll, first released in 1959, had been long criticized for reinforcing a largely homogeneous standard of beauty.

Fisher-Price, which last year had reported a 11% decline, saw an 8% increase in the latest quarter. Meanwhile, Wheels, which includes the Hot Wheels and Matchbox brands and which this year included Star Wars-inspired cars and replica vehicles, reported a 17% sales increase.

Its "Other Girls" brand, however, continue to weigh on the company's results, with a 36% sales drop in the latest period and ending the year down 26%.

Chief Executive Christopher Sinclair had projected a "modestly stronger" quarter, compared with the three months ended in September. Mr. Sinclair, a former PepsiCo Inc. executive and longtime Mattel board member, took over the company's helm last year and has been trying to revamp a roughly 2½ -year sales slump by overhauling management, reigniting the company's creative department, and seeking partnerships with technology companies. Monday morning, for example, Mattel and Amazon.com Inc. disclosed a production deal to make American Girl specials for Amazon's Prime video. Financial terms weren't disclosed.

Overall, Mattel reported a profit of $215.2 million, or 63 cents a share, compared with $149.9 million, or 44 cents a share, a year earlier. Sales edged up to nearly $2 billion, a 0.3% improvement from the year earlier, or 7% when adjusted for currency conversions. Analysts surveyed by Thomson Reuters projected earnings of 61 cents a share on $1.91 billion in sales.

Gross margin narrowed to 50.2% from 50.4% a year earlier.

Write to Maria Armental at maria.armental@wsj.com

(END) Dow Jones Newswires

February 01, 2016 17:25 ET (22:25 GMT)

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