DreamWorks Animation reports its earnings.
DreamWorks Animation SKG Inc.'s (DWA) second-quarter profit slid 6.2% on lower margins, although the computer-animation studio posted revenue gains and said it is on track for its biggest year at the box office and the biggest year for any computer-generated animation studio.
The results topped Wall Street's expectations. Shares rose 1.8% after-hours to $32.65 as the company also announced a $150 million stock-buyback effort. DreamWorks Animation's market value is about $2.3 billion, and the company joins a host of others that have been launching new repurchase efforts.
Chief Executive Jeffrey Katzenberg said the results were driven primarily by blockbuster performances of "Shrek Forever After" and "How to Train Your Dragon," two of the top-10-grossing films so far in 2010.
DWA is the only stand-alone cartoon studio out there. I've had my doubts about the business model ("Turn out lots of Big Screen hits, over and over ...") but DreamWorks makes it work. So who cares about my doubts?
But I continue to believe that sooner or later the place gets swallowed up by one of our fine conglomerates. Moguls? Listen up. Just show up at DreamWorks' Flower Street entrance with a few billion in unmarked bills, and the DWA's corporate chieftan will set the wheels turning.