DreamWorks Animation SKG Inc. tumbled after saying its latest film, “Mr. Peabody & Sherman,” failed to attract enough kids to theaters.
The independent animation studio posted a first-quarter loss of $42.9 million after writing down the picture, which is based on a 1960s-era cartoon.
Jeffrey Katzenberg, co-founder and chief executive officer, said yesterday at the Milken Global Conference that Hollywood needs to get movies to home video audiences sooner. Lackluster ticket sales for “Mr. Peabody,” which opened in second place in its debut last month, led the company to record a charge of $57 million.
“The box office shortfall of ‘Mr. Peabody & Sherman’ is evidence of the current challenges we face within our feature film segment, and restoring the strength in our core business is my No. 1 priority today,” Katzenberg said today in a statement.
DreamWorks Animation fell as much as 6.1 percent to $24.76 in extended trading after the announcement before recovering to $26. The shares fell less than 1 percent to $26.27 at the close in New York and have retreated 26 percent this year.
The net loss amounted to 51 cents a share, the Glendale, California-based company said in the statement. DreamWorks Animation posted net income of $5.58 million, or 7 cents, a year earlier. Revenue grew 9.4 percent to $147.2 million.
The next release from the company that made the “Shrek” films is “How to Train Your Dragon 2,” which opens in theaters on June 13.
“I’m confident that its performance will put us back on-track to once again reach the levels of box office success that we’ve achieved historically,” Katzenberg said in the statement.