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UPDATE: SEC Investigating DreamWorks Animation Writedown On ‘Turbo’; Shares Fall After Q2 Earnings Miss

By | Tuesday July 29, 2014 @ 1:18pm PDT

UPDATE: SEC Investigating DreamWorks Animation Writedown On ‘Turbo’; Shares Fall After Q2 Earnings MissUPDATE: DreamWorks Animation just disclosed the SEC investigation in its conference call with analysts and says it’s cooperating. The company took a $13.5M writedown on Turbo in February. DWA told analysts that it won’t comment further on the matter. Shares were down 8.2% after the news; if that holds tomorrow then it would be a 52-week low.

turbo_posterSeparately, CEO Jeffrey Katzenberg declined to comment on the potential impact on his company if its distributor, Fox, acquires Time Warner. “Honestly, it’s way above my pay grade,” he says.

DWA said that it has bought from Paramount distribution rights to its feature films prior to 2013. They’ll now all be handled by Fox.

Katzenberg calls 2014 an investment year for DWA as it builds consumer products, TV programming, digital, and location-based entertainment. He adds that, generally speaking, the film “marketplace has gotten tougher. We’re competing against more movies than we have in the past.” Still, he says DWA is examining the lower-than-expected sales for Dragon 2. Read More »

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DreamWorks Animation Taps Mark Zoradi As COO As It Promotes Ann Daly To President And Lew Coleman To Vice Chairman

By | Monday July 28, 2014 @ 2:49pm PDT

DreamWorks Animation Taps Mark Zoradi As COO As It Promotes Ann Daly To President And Lew Coleman To Vice ChairmanThe studio just announced the changes one day ahead of its Q2 earnings — and after watching its shares lose 35.4% of their value since the beginning of the year. “As DreamWorks [Animation] grows, we are focusing on creating a strong management structure that has the expertise and capacity to best serve the changing needs of our company,” CEO Jeffrey Katzenberg says. Mark Zoradi was president of Disney’s Motion Picture Group overseeing marketing and distribution until 2010. He also helped to launch Walt Disney Home Entertainment and The Disney Channel and served as General Manager of Buena Vista Television. He says that he’s “enthusiastic about the opportunity to join the talented DreamWorks team at a time of remarkable expansion and growth for the company” and plans to help “build and expand their reach with new businesses and venues.”

Related: Where The Growth Business Is For Jeffrey Katzenberg: Online Video

In the process, DWA elevated Ann Daly — who had been COO since it went public in 2004 — to president. Lew Coleman, who had been president, now becomes Vice-Chairman, and holds on to his other titles as Chief Financial Officer and Acting Chief Accounting Officer.

Related: DreamWorks Animation Shares Fall Again On ‘Dragon 2′ Box Office

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Comic-Con: Benedict Cumberbatch Mania Headlines DreamWorks Animation Panel

By | Thursday July 24, 2014 @ 1:26pm PDT

Comic-Con: Benedict Cumberbatch Mania Headlines DreamWorks Animation PanelDreamWorks Animation might take it as a good sign that the mere sound of Benedict Cumberbatch‘s voice — and the vision of him in character as an animated wolf in Penguins Of Madagascar – elicited screams in Hall H this morning at Comic-Con. Cumberbatch, who’s making his first stop at the San Diego fan convention this year, also stars in Comic-Con fave Sherlock and Peter Jackson’s upcoming The Hobbit: The Battle Of The Five Armies. Not that distracting Sherlock chatter was welcome at the DWA panel: “Any questions about Sherlock, and Comic-Con is CANCELLED,” joked moderator Craig Ferguson.

Benedict Cumberbatch John MalkovichCumberbatch stars in Penguins as Classified, the leader of secret animal agent operation The North Wind who teams with Skipper, Kowalski, Rico, and Private to stop new villain Dr. Octavius Brine. John Malkovich stars as Brine and also made his maiden voyage to San Diego Comic-Con for the panel. “This your first Comic-Con? You’ll fit right in,” Ferguson quipped to Malkovich. Studio pushed the Madagascar spin-off hard, unveiling 20 minutes of footage from the November 26 release.

Related: Hot Trailer: ‘The Penguins Of Madagascar’

There is also speculation and hotfire rumors that Cumberbatch will be announced to star in Doctor Strange, Marvel’s franchise-launching film that will be directed by Scott Derrickson and penned by Jon Spaihts. Cumberbatch has been deflecting questions left and right — maybe more clarity is to come at the Marvel presentation Saturday?

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DreamWorks Animation Unwraps DreamPlace, Its Christmas Shopping Mall Attraction

DreamWorks Animation Unwraps DreamPlace, Its Christmas Shopping Mall AttractionCoca-Cola and merchandisers have been appropriating Santa Claus for years. Now DreamWorks Animation hopes to put its stamp on the (SPOILER ALERT) myth by having Shrek introduce kids to St. Nick when they visit him at shopping malls featuring the studio’s DreamPlace location based experience. DWA just disclosed some details about the attraction to begin this holiday season — part of its effort to boost sales of character-related toys, clothing, and other licensed merchandise — which CEO Jeffrey Katzenberg unveiled last month at the industry’s Licensing Expo.
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Business Briefs: DreamWorks Animation Stock Downgrade; Aereo Strategy Questions; Cable Nets Rocky Forecast

By | Monday July 14, 2014 @ 10:18am PDT

Business Briefs: DreamWorks Animation Stock Downgrade; Aereo Strategy Questions; Cable Nets Rocky ForecastDreamWorks Animation Shares Touch 52-Week Low

The stock is down about 1% in early afternoon trading after taking a hit early this morning following B. Riley’s Eric Wold’s decision to abandon his “buy” recommendation. It touched $21.90, a 12-month low, after the analyst dropped his price target nearly 22% to $25. Wold acknowledged that his upgrade in March, when the stock value was 23% higher, “proved to be ill-timed and premature.” He calls the box office for How To Train Your Dragon 2 “disappointing” which “may turn DWA into a ‘show me’ stock and keep a ceiling on valuations until more consistent box office results develop.” The good news? Wold still likes DWA’s plans to diversify and expand its TV production. He also says that Dragon shouldn’t require a write-down.

Aereo’s Effort To Define Itself As A Cable Company Could Backfire At FCC: Analyst

Aereo may have bought some time with its attempt to redefine itself as a cable company, but it likely won’t succeed, Guggenheim Securities’ Paul Gallant says this morning. He figures that U.S. District Court Judge Amy Nathan — who’s overseeing broadcasters’ plea for an injunction to shutter the streaming service — will want to hear additional arguments after the U.S. Supreme Court recently ruled that Aereo could not take over-the-air signals without payment. Justices likened it to a cable company: Copyright law gives operators the right to a compulsory license, which enables them to carry broadcast signals if they pay a relatively low fee set by the Copyright Office. But if the FCC also deems Aereo to be a … Read More »

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Where The Growth Business Is For Jeffrey Katzenberg: Online Video

By | Thursday June 26, 2014 @ 12:54pm PDT

Where The Growth Business Is For Jeffrey Katzenberg: Online VideoSo now we know. After getting roasted by some competing studio heads (if not on Wall Street) earlier this year when he said movies are “not a growth business,” DreamWorks Animation CEO Jeffrey Katzenberg traveled south to Anaheim today to talk about online video, a business he does see growing into the next big entertainment business platform. Katzenberg sat down onstage with Hank Green, himself a prominent video blogger with brother John Green, author of The Fault in Our Stars. The brothers are co-founders of Vidcon, the massive industry confab and fan festival filling the Anaheim Convention Center the next three days. Katzenberg used the friendly audience of video creators, distributors and others in the business to talk about why online video, particularly on YouTube, is such a promising creation and distribution platform for a new generation of talent outside traditional Hollywood.

“I think the opportunities ahead are so immense,” Katzenberg said. “This platform is in its infancy. Monetizing that is still a struggle. What we will see in a very short period of time, that will all start to migrate up to the top of the pyramid. I believe in five years, 95 percent of the value will come from the top 5 percent” of video creators. Read More »

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Fullscreen’s Talent Managers Sign AwesomenessTV Online Star JennXPenn

By | Wednesday June 25, 2014 @ 7:30am PDT

Fullscreen’s Talent Managers Sign AwesomenessTV Online Star JennXPennIn a sign of the rapidly maturing online-video business, Fullscreen’s expanding talent-management unit has reached outside its own YouTube multi-channel network to sign JennXPenn, whose popular comedy  and music-video Top 10 shorts run on a competing MCN, DreamWorks Animation‘s AwesomenessTV. She will be repped by Fullscreen’s Andrew Graham and Rana Zand, two of the eight managers under former CAA executive Larry Shapiro, now Fullscreen’s SVP and head of talent.

JennXPenn YouTube BannerJennX, whose real name is Jenn McAllister, is nearly 18 and finishing up both her high school studies (online, of course) and a national concert tour with musician Tyler Ward. Reached in Nashville on the tour’s final stop, the Los Angeles-based McAllister said her decision to hire a management team was spurred by her increasingly frenetic array of career opportunities and time demands. Along with banking a series of video shorts ahead of the tour,  in the past several weeks she joined Ward on 16 tour stops and took part in two massive social-media fan festivals in New York and Toronto organized by Digitour Media, whose investors include Ryan Seacrest and Advance Publications. McAllister said she hopes to explore more acting and hosting opportunities in coming months with help from her new management team. “It’s been difficult to balance everything I’ve been working on,” McAllister said. “I was talking to a lot of management (agencies). But I heard a lot of good things about Fullscreen. I have a lot of friends … Read More »

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DreamWorks Animation Shares Fall Again On ‘Dragon 2′ Box Office

DreamWorks Animation Shares Fall Again On ‘Dragon 2′ Box OfficeUPDATE, 7:05 AM: Add Cowen & Co’s Doug Creutz to the list of analysts lowering their revenue estimates for How To Train Your Dragon 2 – and DreamWorks Animation — after the film’s second weekend. Today he cut his domestic box office forecast for Dragon 2 by 28% to $180M — less than the previous film’s $218M. And he dropped his international BO projection by 11.9% to $495M. The upshot: DWA should end 2014 with a 7 cent per share loss, not the 28 cent profit he had anticipated. While bulls look ahead to higher TV revenues and lower film costs in 2016, “given recent film performance and an upcoming film slate that has few obvious winners, DWA still appears to us to be a relatively unappealing stock,” he says.

PREVIOUS, Monday PM: The stock price fell 4.2% to $23.44 today after a second lower-than-expected weekend for How To Train Your Dragon 2for a 16.2% drop since the Friday before the film opened. Dragon 2 generated $25.3M at domestic box offices, down 49% from its opening weekend, for a total of $95.1M. With this trajectory, the film “will likely miss our 6-week est. of $230M,” Wells Fargo’s Marci Ryvicker says. B. Riley’s Eric Wold cut his domestic forecast by 36% to $175M, and his international by 20% to $400M. As a result, the analyst trimmed his target price for DreamWorks Animation shares from $37 to $32. He cut his revenue estimate for the company’s current fiscal year by 5.5%, and cash flow forecast by 14.8% to $109M. Even so, Wold says that “international trends … Read More »

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DeadlineNow Morning Report: Box Office, DreamWorks Animation Stock, Sports TV Ratings

DeadlineNow Morning Report: Box Office, DreamWorks Animation Stock, Sports TV RatingsIn DeadlineNow’s Morning Report, Dominic Patten says 22 Jump Street tops the weekend box office, leaping past How To Train Your Dragon 2; DreamWorks Animation stock price is down by almost 12% following Dragon‘s lower-than-expect take; final Finals games for the NBA and NHL and opening matches for soccer’s World Cup all spurred weekend TV ratings, as did the Game of Thrones season finale.

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Morning Report, Monday June 16

'22 Jump Street' Leaped Past 'How To Train Your Dragon 2' at the weekend box office; DreamWorks Animation stock price is draggin' by almost 12% after 'Dragon' failed to soar; final Finals games for the NBA and NHL and opening matches for soccer's World Cup all spurred weekend TV ratings, as did the <em>Game of Thrones </em>season finale, Dominic Patten reports.

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DreamWorks Animation Shares Lose Altitude After ‘Dragon 2′ Opening Disappoints

DreamWorks Animation Shares Lose Altitude After ‘Dragon 2′ Opening DisappointsHow To Train Your Dragon 2’s lower-than-expected $50M domestic box office in its opening weekend left many DreamWorks Animation shareholders feeling burned. The company’s stock price is down 12.2% in early trading as several analysts lowered their box office estimates for the film – which they’d hoped would help DWA recover after it took writedowns on three of its four previous releases. Cowen & Co’s Doug Creutz called Dragon 2’s performance “somewhat 2-thless” – he figured it would come in closer to $60M — and lowered his ultimate worldwide box office estimate by 20% to $650M. If Dragon doesn’t “significantly grow box office,” then it’s “fair to ask if there are any implications about the strength of DWA’s brand.” Sterne Agee’s Vasily Karasyov says he expects Dragon 2 to gross $180M domestically, nearly 20% below the Street’s pre-opening consensus, and 17% below the gross for the first film. That kind of performance from a sequel to a hit would worry investors “given that 3 of the 7 films scheduled for release through the end of fiscal 2016 are sequels, including How To Train Your Dragon 3.”

But others say it’s too early to judge. B. Riley & Co’s Eric Wold says that animated films typically have long runs in theaters – and notes that Dragon 2 was well received in reviews on Rotten Tomatoes. He sees the $50M opening weekend “as a glass half full and will both monitor domestic trends over the coming weeks relative to our projections … Read More »

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Hot Trailer: Focus Features’ ‘The Boxtrolls’ Aims To Join DWA’s ‘Dragon’ As Early Animated Oscar Bet (Video)

Pete Hammond

It looks like the 2014 Oscar race for Best Animated Feature is already heating up. Boxtrolls First Official TrailerDreamWorks Animation’s How To Train Your Dragon 2 opens today and could be No. 1 for the weekend. At any rate, it is getting such superlative reviews  (especially for a sequel) that it is already looking like a front-runner for that Oscar that was denied to the original in 2010, when it had to compete against the Disney/Pixar juggernaut Toy Story 3, which also benefited from a Best Picture nomination.  That movie of course was a second sequel and it obviously wasn’t hurt by the label. how-to-train-your-dragon-2-trailerDWA has already started its campaign with mailings to various awards groups of the hardcover coffee table book The Art Of  How To Train Your Dragon 2 (I have already gotten two copies including one yesterday that came in a black leather backpack that looked suspiciously like Toothless, the star Dragon of the title).

With a sterling 92% fresh score at Rotten Tomatoes, Dragon 2 is definitely in play and many pundits are already predicting it to win, even though it’s only June and there’s more to come including the latest from Focus Features, The Boxtrolls. Focus started its campaign for their animated film even earlier by sending select media a big toy box container with special slots for the various characters in the film starting with Eggs and Fish and the promise of two more shipments. Yesterday, a second shipment arrived containing Winnie and Shoe. Yes folks, the campaign has started in earnest. Here’s the first full trailer:

Laika, the Portland, OR-based animation studio behind Boxtrolls, received Oscar nominations for its first two animated features ParaNorman and Coraline, and now are hoping the third time is the charm with The Boxtrolls, which opens September 26 as the company’s third stop-motion release with Focus Features. Read More »

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Hot Trailer: DreamWorks Animation’s ‘Home’

By | Thursday June 12, 2014 @ 9:57am PDT

DreamWorks Animation is riding strong early notices ahead of today’s bow of How To Train Your Dragon 2, good news the company needs after disappointments on three of its past four films. After releasing a trailer yesterday for its November 2015 pic The Penguins Of Madagascar, today comes a first look at Home, the 3D aliens-hiding-on-Earth tale featuring the voices of Jim Parsons, Jennifer Lopez, Steve Martin and Rihanna. It it set for a March 27, 2015 bow via Fox. Tim Johnson directed the movie based on Adam Rex’s novel The True Meaning Of Smekday. Check it out:

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DeadlineNow: Will World Cup Help Or Hurt ‘How To Train Your Dragon 2′? (Video)

By | Tuesday June 10, 2014 @ 1:50pm PDT
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The 'Dragon' In The Room

Analysts are mixed over whether the World Cup that kicks off Thursday will help or hamper the chances of the sequel, which DreamWorks Animation needs to be a success. Deadline's David Lieberman reports.

Related: Will The World Cup Help ‘Dragon 2′ Or Keep It From Soaring?

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Will The World Cup Help ‘Dragon 2′ Or Keep It From Soaring?

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The 'Dragon' In The Room

Analysts are mixed over whether the World Cup that kicks off Thursday will help or hamper the chances of the sequel, which DreamWorks Animation needs to be a success. Deadline's David Lieberman reports.

How-to-train-Your-Dragon_320That’s the big question DreamWorks Animation investors are asking ahead of this weekend’s release of the studio’s first major film since March’s Mr. Peabody & Sherman. That film resulted in a $57M impairment charge, making it DWA’s third flop out of its last four releases. So it needs How to Train Your Dragon 2 to succeed. If if does, then it “will boost investor confidence around the DreamWorks story,” B. Riley & Co’s Eric Wold says this morning.

Investors are optimistic. DreamWorks shares are up 20% over the last 30 days, wiping out the dip they took around P&S. Imax helped yesterday when it said that it will release a digitally remastered 3D version of the film into its domestic theaters starting this weekend — a change from the original plan to just offer in some overseas markets. That’s a “vote of confidence from Imax management…as well as a potential incremental box office boost for the film,” Wold says.

But Dragon 2‘s financial fate partly depends on what happens with soccer’s World Cup, which kicks off on Thursday. The film opens in Latin America this weekend as the tournament gets underway, and will hit most of Europe next week. “Excluding the U.S., the countries participating in the World Cup contributed an estimated 48%” of DreamWorks’ worldwide box office results, says Janney Capital Markets’ Tony Wible. Will potential ticket buyers stay home to watch the games — or could Dragon 2 benefit from the light … Read More »

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DreamWorks Animation Moves Up ‘Penguins Of Madagascar’ Bow, Bumps ‘Home’ To 2015

By | Tuesday May 20, 2014 @ 2:10pm PDT

The-Penguins-of-Madagascar-Season-2-Episode-2-It-s-About-TimeLess than a month before the release of its tentpole sequel How To Train Your Dragon 2, DreamWorks has flipped the dates for its next two films. Madagascar spinoff The Penguins Of Madagascar is moving up from March 27, 2015, to a Thanksgiving week bow of November 26. It’s switching places with Home, the aliens-hiding-on-Earth tale featuring the voices of Jim Parsons, Jennifer Lopez, Steve Martin and Rihanna. The dreamworksanimationsmall__121101222147move comes days after DWA CEO Jeffrey Katzenberg’s high-profile day in the Cannes spotlight, when Dragon 2 premiered on the Croisette and he received France’s Commander of the Order Of Arts And Letters honor. The date switch also follows the underperformance of the company’s most recent pic, Mr. Peabody & Sherman, which led to a $57M write-down in Q1. In fact, three of the studio’s past four films have failed to deliver, which Katzenberg blamed on “inconsistent execution” and other factors tied to marketing and scheduling.

Related: Cannes: DreamWorks Animation Celebrates 20 As ‘Dragon 2′ Breathes Fire On The Fest

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Cannes: Jeffrey Katzenberg Becomes Commander Of The Order Of Arts And Letters In Festival Ceremony

Pete Hammond

Rounding out a successful Cannes launch of How To Train Your Dragon 2, DreamWorks Animation‘s Jeffrey Katzenberg this Cannes2014_badgemorning became a Commander of the Order Of Arts And Letters in a Palais ceremony presided over by French Culture Minister Aurelie Filippetti. Cannes Film Festival programming wizard Thierry Fremaux also attended the ceremony and joined KatzenbergOrderin photos with the pair afterwards. The minister lauded the professional and humanitarian achievements of the DWA chief before he accepted the prestigious honor. “I actually have too much to say here but I won’t make it too long. I have found a second home here in France for 40 years. I have so many things to be grateful for the inspiration and the mentorship for so many things that originate here in France, which in many ways not only is the birthplace of cinema, but also culture. I have been blessed to be a part of the Cannes Film Festival commander-of-the-order-of-arts-and-letterswhich is the greatest platform and home of prestigious cinema anywhere in the world. To be on that red carpet, to be in that Palais I think is  really the greatest honor any filmmaker can have.” Katzenberg also acknowledged retiring President Gilles Jacob and Fremaux, who he said has brought “great artistic vision to the festival. His welcoming of animation well over a decade ago made history.”

Related: Cannes: DreamWorks Animation Celebrates 20 As ‘Dragon 2′ Breathes Fire On The Fest

He also mentioned his own relationship with the incoming president of the festival, Pierre Lescure , who was also in attendance today. “As the next president of the festival, it only insures many more decades of success,” he said. “To receive this is really a great honor and one that I am greatly appreciative of.” Read More »

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Jeff Bewkes Challenges Jeffrey Katzenberg’s View That Movies Aren’t A Growth Business

Jeff Bewkes headshotOuch: “Maybe it is for him,” the Time Warner CEO said when asked in an analyst call to respond to the DreamWorks Animation chief’s comment this week that “movies are not a growth business.” This was an easy punch for Jeff Bewkes to throw: Warner Bros had a record year domestically last year and just reported strong Q1 results helped Jeffrey_Katzenberg__120906063125by The Lego Movie and 300 — while DWA shares are down about 11% today after it took a $57M writedown for Mr Peabody & Sherman. Jeffrey Katzenberg’s company “doesn’t make many movies,” Bewkes says. “We’ve been doing fine in movies.” He predicts “continued growth overseas” for his studio’s event films. “We do have some tough comparisons given the great year we had last year.” Even so, “we do think we can grow the business over time. We don’t agree with (Katzenberg’s) view” although he acknowledged that “the business they’re in is quite different.”

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Jeffrey Katzenberg: New Animated Films Have To “Check Off More Boxes” Following ‘Peabody & Sherman’ Loss

Mr-Peabody-Sherman-Official-Trailer-9The DreamWorks Animation chief sounded like he’d prefer to have a root canal than talk to analysts about how his studio hopes to avoid another failure like Mr. Peabody & Sherman — which just resulted in a $57M write-down for Q1.  Three of the studio’s past four films failed to deliver, Jeffrey Katzenberg noted, which he blamed on “inconsistent execution” and other factors tied to marketing and scheduling.

As the market for kids’ films becomes more competitive, “we have to focus on the creative side of the business” to find “ideas that have the broadest global appeal” and stand out as must-see experiences. “Playability honestly is just not enough today. … We feel a different level of criteria in terms of the ideas we’re picking and the marketing of the ideas.” He’s hot on sequels and says DWA has more in the pipeline than ever, with plans to release at least one a year. Read More »

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DreamWorks Animation Takes $57M Impairment Charge On ‘Mr. Peabody’

DreamWorks Animation shares are down 5.2% in postmarket trading following the announcement in its Q1 earnings. dreamworksanimationsmallThe write-down “is evidence of the current challenges we face within our feature film segment, and restoring the strength in our core business is my number one priority today,” CEO Jeffrey Katzenberg says. He adds that DWA’s next release — How To Train Your Dragon 2, set to open June 13 — “will put us back on-track to once again reach the levels of box office success that we’ve achieved historically.” With the Mr. Peabody & Sherman damage, DWA generated a net loss of $42.4M in Q1, down from a $5.6M profit in the period last year, on revenues of $147.2M, +9.4%. The top line beat the consensus forecast for $137.2M, but the charge for the film contributed to a loss of 51 cents per share, far bigger than the 14 cent loss that the Street anticipated. Read More »

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