Despite saying that it made up the $600 million in revenue tied to its since-departed Disney Princess license and soft sales of Monster High merchandise, Mattel reported full-year sales fell 4% to $5.4 billion amid a “very difficult” holiday selling season, outgoing Mattel CEO Christopher Sinclair told analysts on Thursday.

The loss of the Disney Princess license to Hasbro was Mattel’s “biggest challenge” for its Toy Box business in 2016, Mattel COO Richard Dickson said. Mattel’s Disney Princess-related annual sales were about $400 million, analysts have said.

“In the midst of an on-going transformation and reestablishing retailing and licensing partnerships, we achieved that goal” of making up the lost revenue, Dickson said.

The toymaker “made up considerable ground” in offsetting lost Disney Princess sales with revenue from its licensed DC Superhero Girls products and continued “strong demand” for Batman vs. Superman merchandise, Dickson said, despite the movie’s struggles at the box office.

In Q4 ended Dec. 31, Mattel’s net income fell 10.8% as revenue dropped to $1.83 billion from $1.99 billion on a “significant decline” in industrywide sales, Sinclair said. While total U.S. toy sales rose 5% to $20.4 billion in 2016, according to NPD, the business “slowed and shifted” in December with Q4 finishing with a 3% increase, Sinclair said. Mattel’s sales fell 7% during the first three weeks of December.

The slowing sales resulted in “heavy discounting” among retailers during the holiday season and producing inventory – largely in Mattel’s Mega Bloks building set business – the toymaker carried into Q1, Sinclair said. Indeed, industry building set sales declined 3% in 2016, against a 9.4% increase a year earlier, NPD said. The U.S. market “rebounded dramatically” the week prior to Christmas with sales during that period accounting for 20% of the toy industry’s Q4 revenue.

“We had enormous pressure put back on shipping expectations and forecast and we were faced with, ‘do you react and try to get shipping in and get your product for the consumers or do you take it on the chin?’ We concluded we needed to get product on the shelves,” Sinclair said.

Mattel expects sales of Cars 3-related toys will top $300 million this year, down from an earlier forecast of $350 million. The Pixar movie is scheduled to be released June 16. Mattel is forecasting a “mid- to high-single” digit percentage increase in revenue for this year, Sinclair said.