Entertainment Industry

« Previous | Company Town Home | Next »

DreamWorks Animation's profit drops; no sequel for 'Monsters vs. Aliens'

DreamWorks Animation SKG posted a 48% decline in third-quarter profits, but the results were nonetheless better than what Wall Street was expecting. 

The Glendale-based studio also disclosed that it would not be producing a sequel to its latest movie, "Monsters vs. Aliens," which received a tepid response in key overseas markets. 

DreamWorks reported net income of $19.6 million, or 23 cents a share, on revenue of $135.4 million in the quarter ended Sept. 30.

That compared with net income of $37.4, or 41 cents share, on revenue of $151.5 million during the same period a year ago, when the studio benefited from its hit film "Kung Fu Panda."

Analysts were expecting earnings of 16 cents a share on revenue of $129.3 million, according to consensus estimate by Thomson Reuters. The studio did not release a movie in the third quarter of this year.

Instead, the studio’s results were driven by home video and pay television revenue from its 2008 films “Madagascar: Escape 2 Africa” and “Kung Fu Panda” and from “Monsters vs. Aliens,” which was released on home video Sept. 29.  The film has sold an estimated 4.6 million units, in line with what several analysts were expecting.

Analysts have expressed concern that the anemic DVD market could hurt sales for "Monsters vs. Aliens," which came out in theaters last March. All the major studios have been buffeted by an industry-wide slowdown in DVD sales as the recession forces consumers to curtail spending. U.S sales of DVDs and high-definition Blu-ray discs dropped nearly 14% in the third quarter, according to Digital Entertainment Group.

DreamWorks executives, however, have repeatedly stressed that the studio's computer-animated movies are less vulnerable to the DVD downturn than live-action films.

Chief Executive Jeffrey Katzenberg continued that theme Tuesday, telling analysts in a conference call that "Monster vs. Aliens" was off to a “strong start in its initial home video release.”  Katzenberg declined to give a forecast for DVD sales, saying it was too early to estimate future sales. "Madagascar 2" has sold 11.3 million units to date, while "Kung Fu Panda" reached 16 million units through the third quarter.

Katzenberg also disclosed that the studio did not plan to produce a sequel to "Monsters vs. Aliens," which generated $380 million at the box office but did not fare well in some key international markets. Asked why, he said: "I'd like to tell you there's a perfectly rational, clear and easy answer as to why not, but there isn't."

“There was enough of a consensus from our distribution and marketing folks in certain parts of the world that we would be pushing a boulder up a hill,” Katzenberg said of the decision not to pursue a sequel, which has been DreamWorks strategy with its other movies.

The company did not revise its outlook for the year, saying it expected earnings to be up slightly or flat from a year ago.

-- Richard Verrier

Comments () | Archives (9)

With Shrek 4 coming out next year, it is only a perfect example of why Pixar is so sucessful in comparrision to Dreamworks.

Pixar, except for Toy Story, never makes sequels.

They never make direct to DVD sequels as well.

Katzenberg (Formerly of Disney & CEO of Dreamworks) constantly uses the Disney (owner of Pixar) formula that if an Animated film does well, you exploit it.

That is why there are so many Shreks & Matagascars.

Penguins & soon Kung-Fu Panda have been & will be appearing on the small screen (Nick). Generally, that has been sucessful for strong animation films & in resolve supported Disney (Under Katzenberg) During the late 80's - Mid 90's.

It is my opinion that if Katzenberg wanted to exploit the animation aspect, he should continue to save any attempt of a sequel to a better location - TELEVISION.

In regards to the comment about PIXAR not making sequels except for the Toy Story franchise, not true. They are currently working on Cars 2 with an expected theatrical release date of Spring 2011. I am pretty certain they will even do an Incredibles and a Monsters Inc. sequel as well.

The Halloween Monsters Vs Aliens TV special aired the other night. It used the original cast voices and the storyline was actually well done. This will garner more of a viewership for those who may not have seen, or were familiar with, the MvA movie. Dreamworks will likely rethink their sequel plans once the holiday season has come to pass.

Also, Toy Story 2 was initially slated as a direct-to-video release. It was the quality of Pixar's story that resulted in the theatrical release.

I would hope they do a 2nd one, I saw this in the theatres in 3-D and loved it.
I also saw the Haloween special last night and it was AWSOME!

I have to sit through alot of these animated movies because i have kids and most of the time im really bored but for whatever reason i enjoyed monsters vs aleans.I thought the movie was actually pretty good with great characters.We also watched the halloween special the other night and my kids loved it.I think giving up on this franchise is a big mistake because i believe it has as much potential as anything else dreamworks has done.Monsters vs aleans wasnt a bomb at the box office,if memory serves me correctly they actually made a small profit off of it didnt they?

I read this on a friend's phone this morning in Math and I was literally in tears. Frig my life.
I'm gonna go slit my wrists, dye my hair black and listen to screamo, kthnx.

I totally understand the profit thing, but there is so much they could do with a sequel! The battle of the snail combined with the nuclear war the president started could turn people into zombies and the monsters could adopt a zombie or something... :/ Susan could also face this big emotional stuggle over Derek being a zombie... She could still care about him, I guess. Then Dr. Cockroach could be all, "Use the force... You don't need him. He's all undead."
I know mostly wanted a sequel for Dr. Cockroach/Susan and for some backstory on Dr. C...
If there isn't any of that in the series, so help them...
*brandishes giant spoon*

So, yeah.
I started my day off pretty crappy. :/

Well, let's just hope they get the original voice actors, or get ones that are just as good. Though, I doubt Hugh Laurie will take the time to do it since he's doing House. Dreamworks is wasting money on so many Shreks. They are actually making a full length feature film of Puss in Boots! Can't you drop that project and make another MVA? This movie was amazing and I think my favorite Dreamworks picture. Shrek 1 and Shrek 2 were amazing as well, but there was no need for a 3rd. And yet, they're making a 4th and 5th, plus the Puss in Boots thing. IT'S NOT FREAKING SAW!

People who love this movie,want this sequel and tv,and everyday we write to dreamworks thousands and thousands mails asking it,Mva 2 and tv too.

awww wht?wht? huh?
i want the sequel so bad D: i will do everything to see the first movie and i wont stop till i found part 2 of mva {:o duh....there is no part 2 anymore TT^TT such a heartbreaker im a fan of it so bad


Recommended on Facebook

In Case You Missed It...

Photos: L.A.’s busiest filming sites