by ALESSANDRA KLETTER
Phone: (818) 695-5000
In 1994, Jeffrey Katzenberg left The Walt Disney Company to join forces with historic director Steven Spielberg and music mogul David Geffen to create DreamWorks SKG. The three entertainment tycoons set their sites on making the production company into
the next major Hollywood studio with Katzenberg heading the leadership of its animation endeavors. In 2004, the animation department officially became its own entity: DreamWorks Animation SKG. Katzenberg currently serves Chief Executive Officer and Director to this day. In twenty years DreamWorks Animation has amassed thirty one feature films, which have earned five Golden Globes nominations, earning one win for Best Animated Feature, and nine Academy Awards nominations, which have earned three wins. DreamWorks Animation has also created eighteen original television series.
DreamWorks Animation is in dire need of good news on Thursday, April 30, 2015 at 1:30pm when their First Quarter 2015 Results are released. Their Fourth Quarter Results 2014 were released on February 24th, 2015. Their 52-week high for 2014 occurred in the Fourth Quarter at $35.74, a number they managed to maintain for the First Quarter 2014 with the high being $35.34. However, that number drastically fell and in the Fourth Quarter 2014, their 52-week low came in at $20.28, nearly parallel to the 52 week low, which was $16.16 in the First Quarter 2013. This also mirrors their revenue decrease of over 3%, resulting in a full year revenue of $684.6 million. Katzenberg also took a major blow to his annual salary from $6.4 million in 2014 down from $13.5 million, a 53% decrease in only one year. The company received what hope to be a good omen when their stock went up due to the unprecedented success of their most recent/sole release for 2015, Home.
Until recently with the surprise hit from Home, they have struggled to have a recent release find it’s way to the top of the box office. They have released a string of (mostly) critically acclaimed flops including Penguins of Madagascar, How To Train Your Dragon 2, Mr. Peabody and Sherman, and Turbo, with their last hit being The Croods back in 2013. This decrease in profit then resulted in some serious downsizing, both financially and in employees. In late January 2015, right as PDI/DreamWorks, the in-house feature animation studio, was celebrating their Golden Globe Best Animated Feature win and their Academy Award Nomination for Best Animated Feature, How To Train Your Dragon 2, it was announced they would be shutting down the shop completely. Over 500 employees lost their spot at DreamWorks when PDI was discontinued, only for the next move towards recovery was made when DreamWorks sold their campus to SunTrust Banks for $185 million and now rent back the property from them. In addition to the downsizing, salary cuts and selling of properties, there was some shuffling of power with the executives.
Restructuring Under New Leadership
Kristine Belson, in her few years as President of Feature Animation at DreamWorks produced the company’s last hit, The Croods, and even got herself an Oscar Nomination for Best Animated Feature, but left DreamWorks to take over in the same position at Sony Pictures Animation when Michelle Raimo Kuoyate stepped down, but still remains as a producer. Belson was succeeded at DreamWorks by new co-presidents Bonnie Arnold and Murielle Soria, succesful producers of the Madagascar and How To Train Your Dragon franchises.
CEO, Jeffrey Katzenberg, completely reconfigured the company’s slate with a new agenda that covers the next 3-5 years, canceling multiple projects and instead green lighting more sequels in current/recent franchise hits such as Kung Fu Panda and How To Train Your Dragon. How To Train Your Dragon 2, while it did present solid numbers at the box office, the company still considers it somewhat of a flop as it failed to bounce back the company as they hoped it would to make up for the huge amount of profit lost from the disappointing recent releases. However, they will continue to add to the saga as the numbers from How To Train Your Dragon 2 will be stellar if they can recreate it once their financial situations are better sorted. This model will be used to do just that and is intended to get the company’s back on their feet with far less investment in new original films and instead continuing to build on franchises that already proved.
Looking To The Future
Katzenberg has a lot to look forward to in the coming years as he has completely reworked the slate and hopefully can find more success with upcoming sequels, television spin offs, and brand partnerships. With the surprise success of Home, DreamWorks is sure to capitalize on the Home Video demand for the film as well as profit greatly from the merchandise associated the film and its characters. They will also be continuing with their Netflix exculsive series, All Hail King Julien, spin-off of the Madagascar franchise. The show was recently nominated for five daytime Emmys and has a very receptive audience. They also will be launching a new series spin off of How To Train Your Dragon: Race To The Edge. They will also be releasing Kung Fu Panda 3 and teamed up with Denny’s for an interactive cross promotional app. DreamWorks is one of the oldest and most established animation studios, with an impressive body of work to be proud of. Hopefully with new leadership, the new money saving tactics, and the launch of new television programs and sequels, DreamWorks will regain its financial grounding. Then, they can begin to create new original content again with the profit, as well as go back to their pending projects that were cancelled in the re-slate and pick up were they left off. The recent history of DreamWorks Animation is some of its toughest ever and proves that the company is remaining level-headed and taking the steps they see fit in order to bounce them back and provide audiences from around the world with laughter, storytelling, and inspiration through beautifully crafted characters and their stories from their worlds.
Currently in theaters is Home, which premiered domestically in theaters on March 27th, 2015, ranked number one in its opening weekend against heavyweight competitors such as The Divergent Series: Insurgent and Cinderella (2015).