RobertoOrtiz
07-31-2004, 06:04 AM
Quote:
"While Pixar earned $124.8 million last year on $262.5 million in revenues last year, DreamWorks Animation managed to lose $160 million on $167.9 in operating revenue. While Pixar has been consistently profitable (with fat margins to match), DreamWorks hasn't turned a profit since it milked the last of its Shrek juice back in 2001.
Naturally, this will all change as the money from the popular Shrek sequel starts trickling in. It's not just the global box-office receipts. In November, Shrek 2 will hit the home video and DVD market. Pixar's last two releases, as well as the original Shrek, moved more than 25 million copies apiece, and this one should shatter those milestones.
It's obviously fair to say that animation has been taken too kindly in the retail space. Even DreamWorks' five hand-drawn releases, averaging a rather ordinary $72 million at the multiplex, still managed to sell a cumulative 44 million units in the home video and DVD market.
Once you start tacking on broadcasting rights to the lucrative licensing rights that come from rich characterizations, then you begin to realize how a pure play in animation can truly rock. If you like Pixar's numbers now, just imagine how good they'll look in a couple of years when it doesn't have to share the pie. But in hyping up the prospects for DreamWorks Animation, it seems as if the numbers keep getting in the way.
Pixar has gone through the cyclical lulls between releases, yet it has always managed to produce healthy income statements. Its hefty net margins have kept the company afloat through thick and thin. So why did DreamWorks Animation report a loss that was almost as wide as the company's top line last year, and is there any hope that it will ever become the lean, green money-printing machine that is Pixar?
"
>>Link<< (http://www.fool.com/news/commentary/2004/commentary04073001.htm)
_R
"While Pixar earned $124.8 million last year on $262.5 million in revenues last year, DreamWorks Animation managed to lose $160 million on $167.9 in operating revenue. While Pixar has been consistently profitable (with fat margins to match), DreamWorks hasn't turned a profit since it milked the last of its Shrek juice back in 2001.
Naturally, this will all change as the money from the popular Shrek sequel starts trickling in. It's not just the global box-office receipts. In November, Shrek 2 will hit the home video and DVD market. Pixar's last two releases, as well as the original Shrek, moved more than 25 million copies apiece, and this one should shatter those milestones.
It's obviously fair to say that animation has been taken too kindly in the retail space. Even DreamWorks' five hand-drawn releases, averaging a rather ordinary $72 million at the multiplex, still managed to sell a cumulative 44 million units in the home video and DVD market.
Once you start tacking on broadcasting rights to the lucrative licensing rights that come from rich characterizations, then you begin to realize how a pure play in animation can truly rock. If you like Pixar's numbers now, just imagine how good they'll look in a couple of years when it doesn't have to share the pie. But in hyping up the prospects for DreamWorks Animation, it seems as if the numbers keep getting in the way.
Pixar has gone through the cyclical lulls between releases, yet it has always managed to produce healthy income statements. Its hefty net margins have kept the company afloat through thick and thin. So why did DreamWorks Animation report a loss that was almost as wide as the company's top line last year, and is there any hope that it will ever become the lean, green money-printing machine that is Pixar?
"
>>Link<< (http://www.fool.com/news/commentary/2004/commentary04073001.htm)
_R