WWE received a reminder during the third quarter of why it needs to pin down plans to make its film division profitable.

The studio division alone saw revenue plummet 51% to $3.7 million due to poor B.O. and homevideo sales.

The company’s WWE Studios division took a $5.1 million writedown from three films, “Knucklehead,” “The Chaperone” and “Inside Out,” during the period that ended Sept. 30, dragging down overall results for WWE, which saw revenue fall 9.5% to $108 million and profits drop 26.1% to $10.6 million.

As a result, WWE’s chairman and CEO Vince McMahon said the company was going to “monitor and refine to improve future performance” of the film business.

WWE already has started overhauling its film biz, tapping Michael Luisi in September to oversee WWE Studios. Under Luisi, WWE will focus more on partnering with outside producers and picking up projects at film festivals. It acquired post-apocalyptic thriller “The Day,” at the Toronto Intl. Film Festival. and paired with Pathe UK to make the thriller “No One Lives.”

The studio division still has three films to release as part of its old model over the next six months.

Films will play a key part of the programming WWE plans to air on a new cable channel it will launch sometime next year. Network will be owned by WWE. It has yet to reveal who will carry the channel, however.

WWE has started developing series like a reality show for the channel. To prep for the launch, WWE also has been digitizing 30,000 hours of its library of 100,000 hours of footage. Programming will include re-purposed content from “Monday Night Raw,” whose current deal with USA Network run through October 2014; show has been a regular ratings powerhouse for the cabler for years.

As it tries to boost earnings, WWE is relaying heavily on the return of Dwayne “The Rock” Johnson to the ring to improve results.

His appearance at “WrestleMania 27,” in April, boosted the number of buys for the pay-per-view to its highest number in years. Soon after, WWE quickly announced The Rock would be featured in a high-profile match at “WrestleMania 28,” in Miami, next year. He is also prominently featured in upcoming PPVs and guests on episodes of “Raw.”

Johnson’s involvement, after a seven-year hiatus continues to reap rewards for “‘Mania,” with the broadcast picking up another 65,000 incremental buys during the third quarter. A match at the “Survivor Series” PPV sold out in 90 minutes, due to his appearance.

The TV division saw revenues rise 5.8% to $78 million during the quarter, thanks to increased PPV sales of “‘Mania.”

On the videogame front, THQ is readying to release “WWE ’12” this month, which the gamemaker is high on, and will soon launch a WWE game on Facebook. The “WWE All Stars” game performed well.

While game sales grew, other parts of WWE’s consumer products arm, including toy sales, took a tumble, causing that side of its biz to decline 7.5% to $19.8 million. Revenue from Mattel-made toys, in particular, declined 24%.