Box office turkey “Mr. Peabody and Sherman” contributed to DreamWorks Animation SKG Inc. reporting a much wider first quarter loss than analysts expected on Tuesday.
The Glendale animation studio reported a net loss of $43 million (-51 cents a share) for the quarter ending March 3, compared with net income of $5.6 million (7 cents) in the same period a year earlier. Revenue increased 9 percent to $147.2 million.
Analysts on average expected net income of -14 cents on revenue of $137.2 million, according to Thomson Financial Network.
The studio took a $57 million write down on “Mr. Peabody and Sherman,” which was released in theaters in early March and grossed $261 million at the worldwide box office. The write down was partially offset mitigated by a $22.5 million income tax benefit recorded in the quarter.
DreamWorks Animation Chief Executive Jeffrey Katzenberg acknowledged the film’s poor performance is evidence of challenges in the company’s feature film segment – which needs to be turned around.
"Our next film is ‘How to Train Your Dragon 2’ (in June), and I am confident that its performance will put us back on-track,” Katzenberg said in a prepared statement.
Shares closed down 12 cents, or about half a percent, to $26.37 on the Nasdaq.