Universal Reports 75% Increase in Q4 Home Entertainment Revenue3 Feb, 2016 By: Erik Gruenwedel
Universal Pictures’ second consecutive dream year is getting its official due, with economic benefits trickling down to home entertainment.
The studio, which includes Universal Pictures Home Entertainment, Feb. 3 said strong sales of Minions and Jurassic World helped increase home entertainment revenue 74.9% in the fourth quarter (ended Dec. 31, 2015) compared with the previous-year period.
Indeed, Jurassic World was the top-selling packaged media release in 2015 despite only hitting retail shelves Oct. 20. The title, which ended last year No. 2 at the domestic box office (behind Star Wars: The Force Awakens), sold more than 5.3 million combined DVD/Blu-ray Disc units, generating in excess of $107 million, according The-Numbers.com. Minions sold 3.3 million units ($61.9 million) and finished ninth in sales last year despite its Dec. 8 street date.
Studio Q4 operating cash flow (profit) increased 84.6% to $143 million, compared with $77 million in the fourth quarter of 2014, reflecting higher revenue, partially offset by a 22.1% increase in operating costs, primarily driven by an increase in the amortization of film costs. Revenue increased 25.8% to $1.6 billion, compared with $1.3 billion in Q4 of 2014.
For the year, studio revenue increased 45.5% to $7.3 billion, compared with $5 billion in 2014, driven by theatrical revenue from the aforementioned titles, in addition to Furious 7. Notably, Universal’s signature 2015 fiscal performance followed a record 2014, which saw the studio break global and domestic box office records.
Operating cash flow in 2015 increased 73.5% to $1.2 billion, compared with $711 million in 2014, partially offset by a 40.9% increase in operating expenses, primarily driven by an increase in the amortization of film costs and higher advertising, marketing and promotion expense due to a larger film slate.
“Film had the best year in its history. Universal Pictures is in a great position for ongoing success,” CFO Michael Cavanagh said on the fiscal call.