DreamWorks Animation Stock Tumbles After ‘Mr. Peabody’ Writedown

Mr Peabody and Sherman

DreamWorks Animation shares have slid sharply after the company took a $57 million impairment charge against earnings due to disappointing box office results for “Mr. Peabody and Sherman.”

Shares were down 8.8% on Wednesday, falling $2.34 to $24.03. It was the lowest trading level of 2014.

After the market closed Tuesday, the company reported a first-quarter loss of $42.9 million — or 51 cents a share — on revenues of $147.2 million. DreamWorks Animation posted earnings of $5.6 million — or 7 cents a share — on revenues of $134.6 million during first quarter of 2013.

Shares declined even though the loss was somewhat less than analysts had expected. The stock had been downgraded Monday by analysts at Bank of America to an “underperform” rating in a research report.

“The box office shortfall of ‘Mr. Peabody and Sherman’ 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,” DreamWorks Animation CEO Jeffrey Katzenberg said on Tuesday.

He predicted a strong showing for “How to Train Your Dragon 2,” opening June 13, but admitted that three of the last four films — “Mr. Peabody,” “Turbo” and “Rise of the Guardians” — have underperformed.

“Mr. Peabody” opened on March 7 through Fox and has grossed $261 million worldwide. Its production cost was $145 million.

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  1. No Name says:

    Making a movie with characters that haven’t being on television for almost 50 years apart from one Simpsons cameo without giving much background on it was a bit stupid. DreamWorks should of shown old Peabody’s Improbable History shorts on their YouTube channel or through something else to get the public interested. People who grew up watching that movie would have grand kids by now. It seems they wanted to appeal to the old fans when they aren’t the correct audience to be aiming it at.

  2. Stephan Klose says:

    It’s irresponsible to make a movie for $145 that has little appeal for those who don’t know the brand, which is probably most of us.

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