The home entertainment debut of “Home” helped lift profits and revenues at DreamWorks Animation, even though the studio did not have a theatrical release during the fiscal quarter.
Wall Street liked what it saw, with the studio’s stock spiking more than 10% in after-hours trading on the stronger than expected results.
Revenue for the period climbed 43.3% to $259 million, while operating income was $27 million and net income topped out at $1.4 million. Earnings per share was two cents. That beat estimates. Analysts had expected the company to report revenue of $206 million and a loss of five cents.
The results were adjusted and did not include $3.6 million in restructuring costs.
The solid numbers are a shot in the arm for DreamWorks Animation, which is overhauling its feature film unit after a series of film flops such as “Penguins of Madagascar” and “Mr. Peabody and Sherman” caused it stock to tank. The company was also bruised by failed sales to Hasbro and Softbank.
In response, DreamWorks has laid off staff, sold its Glendale, Calif. campus, and tapped producers Mireille Soria and Bonnie Arnold to head up its film division. It will not release another film until January when “Kung Fu Panda 3” hits theaters.
“While we still have considerable work ahead of us, I am proud of the team’s collective efforts and remain confident that we are well positioned to meet or even exceed our stated goals for the year while continuing to drive long term value for our stakeholders,” CEO Jeffrey Katzenberg said in a statement.
Despite the drama it has caused, the feature film unit’s performance was a source of strength. Revenue improved 11% to $158 million. Although “Home’s” theatrical run was over, the alien invasion comedy did brisk business on DVD, in digital sales and on-demand. The film sold 4.7 million home entertainment units and added $49.7 million to the film segment’s revenues.
The company also got an assist from its television and new media segments. Licensing agreements goosed television earnings from $14.3 million to $50.7 million for the period, while the new media division saw revenues climb to $20.7 million, more than double what it reported in the year-ago quarter.