The popular independent animation company DreamWorks has announced it will cut about 500 jobs and release only two movies per year, as opposed to three. The plan to restructure business comes after the under-performance of many of the company’s most recent films.
There had been talk in previous weeks about another round of layoffs, but the severity was not made public until today.
Notable departures from the restructuring plans are Marketing Chief Dawn Taubin, Vice Chair Lou Coleman and COO Mark Zoradi. With the move, the studio also incurs a $290 million pretax charge.
“The number one priority for DreamWorks Animation’s core film business is to deliver consistent creative and financial success,” said DreamWorks Animation chief executive officer Jeffrey Katzenberg. “I am confident that this strategic plan will deliver great films, better box office results, and growing profitability across our complementary businesses.”
Outside of sequels to already proven films, like last year’s Oscar nominated How To Train Your Dragon 2, DreamWorks original films like Turbo and Mr. Peabody & Sherman have not done as well as they had hoped.
The smaller staff and lower output are meant to maximize creativity and minimize cost. The plan is to release one sequel per year, along with one original film. The next few years will see sequels for the Kung Fu Panda, The Croods and How To Train Your Dragon.
Another notable move is the outsourcing of the film based off the popular children’s book series, Captain Underpants. The move is also set to save the company a significant amount of money.
There were talks of a merger or potential buyer towards the end of last year, however nothing materialized and the financial woes continued. Many high profile studios and companies were mentioned, with Hasbro being the most notable.
Shares of the company rose about one percent following the news.
Source: The Hollywood Reporter