Toon studio nabs fivefold profit hike
Pixar posted a fivefold increase in fourth-quarter profit and a 39% improvement in annual earnings Tuesday, but topper Steve Jobs put the day’s spotlight squarely on his recent rejection of creative partner Disney.
A week ago, Pixar announced a halt in talks with the Mouse House to extend Pixar’s co-production relationship with Disney. And in a conference call to discuss Pixar’s year-end earnings, Jobs said the Richmond, Calif.-based animation studio bolted those talks largely because Disney refused to extend identical terms to the next two co-productions, “The Incredibles” and “Cars,” as the parties had hammered out for prospective future movies.
Pixar is confident it can land better terms on future pics from a new partner than what it might have secured from the Mouse, Jobs added.
“So, after 10 frustrating months, we ended our talks with Disney,” he said. “It is not without regret. We will miss Dick Cook and his (studio) team.”
Topper pointedly avoided mentioning head Mouseketeer Michael Eisner, except to note a recently published article attributing to Eisner skepticism over the prospects for last year’s “Finding Nemo.” The family toon — most recent of a string of five Disney/Pixar co-productions — ultimately cruised well north of $300 million in domestic box office in a feat of unprecedented toon success.
Jobs rejected an analyst’s suggestion that Pixar might have forced a divorce with Disney by presenting unreasonable demands on the Mouse. “We thought we were willing to accept a quite reasonable deal, but Disney felt differently, and that was their right and privilege,” he said.
Jobs noted Pixar still will have the right to make sequels with Disney but said Pixar has already rejected an overture to make a “Toy Story 3.” No decision has been made on whether to exercise rights to participate on sequels involving other franchises, he added.
Pixar will meet with a number of other studios with the aim of securing an alternative arrangement for its post-“Incredibles” pics by fall, Jobs said. “Incredibles” is slotted for November release, with “Cars” skedded for 2005.
Jobs expressed confidence another distrib can be found with marketing prowess equal to Disney’s. And he rejected any suggestion there will be a loss of creative quality from ending Pixar’s relationship with the Mouse.
“The truth is, there has been little creative collaboration with Disney for years,” Jobs said.
Pixar reported $83.9 million in quarterly net income. Its revenue tripled to $164.8 million in the period.
Over 12 months, Pixar saw $124.8 million in profit. Annual revenue climbed 30% to $262.5 million.
“Nemo” homevid sales repped the main revenue driver in the latest quarter.