DreamWorks Animation Knows Its Films Are Performing Poorly, Here's How It Plans To Change That

DreamWorks Animation announced Tuesday that it will take a writedown on its recent release, "Mr. Peabody & Sherman."

It's the studio's latest animated feature they've had to take a writedown on after underperformances on 2012's "Rise of the Guardians" and last summer's underwhelming "Turbo." That accounts for three of DWA's last 4 animated pictures.

"The Croods," which made $587 million last year, stands out as the company's only real successful original film since 2010's break-out hit "How to Train Your Dragon" and 2008's "Kung Fu Panda."

During the company's Q1 earnings call, CEO Jeffrey Katzenberg didn't shy away from addressing the studio's recent failures. He outright acknowledged them saying his number one priority is getting DWA's feature film business back on track.

Here's four ways DreamWorks Animation plans to turn it around.

1. Cut production costs on movies

DreamWorks Animation's last four titles have cost an estimated average of $140 million each.

Starting in November, Chief Operating Officer Ann Daly says the studio's average movie will cost $125 million or less to produce. The first feature release under this new structure will be "Home," a film about aliens invading Earth, that will feature the voice talents of Jim Parsons ("The Big Bang Theory"), Rihanna, and Jennifer Lopez.

"Our objective is to ensure that our box-office successes will be more lucrative," says Daly. "And in the case where a film performs below expectations that it can still be profitable."

2. More sequels and fewer movie releases

Rather than rely on more risky original pictures, DWA will start rolling out more sequels to their most lucrative franchises. So expect to see more "Madagascar," more dragons, and, yes, more "Shrek" spin-off movies.

The upcoming movie slate includes "How to Train Your Dragon 2," How to Train Your Dragon 3," "Penguins in Madagascar," "Kung Fu Panda 3," a sequel to 2013's "The Croods" and another to Shrek character "Puss in Boots."

Katzenberg said the studio needs to be "more flexible" with the number of movies it releases in a given year.

Daly says the studio plans to average one franchise film every year through 2018.

3. More efficient marketing

Katzenberg says he wants to be executing strong marketing for "event movies" as far as 18 months before their release in order to ensure their releases "standout to audiences as must-see theatrical experiences."

4. Original movie ideas will will go through the wringer to make sure they're worth releasing

Katzenberg:

"Movies that are not sequels, we are - I think really triple or looking at those to make sure that they are big concepts and highly marketable concepts."

"So, even an original movie like 'Boo,' which is coming next summer is a ghost movie. It's a flat-out comedy with Seth Rogen, Melissa McCarthy, Bill Murray, big visual fun kind of Ghostbusters ideas, it's a little early, its more than 15 months out from release in it. But it feels like a very big idea. It feels like a very marketable idea, it's got very strong elements to it.

"When we're looking at original movies they actually need to check-off a lot more boxes than they've had to in the past."