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Universal Sees Q2 Revenue, Income Decline in Post 'Jurassic World'

27 Jul, 2016 By: Erik Gruenwedel

Coming off a record 2015 at the box office and stellar retail campaign on movies such as Jurassic World, Furious 7 and Fifty Shades of Grey, Universal Pictures is discovering fiscal period sequels often don’t compare.

The studio’s second-quarter (ended June 30) operating income plummeted nearly 87% to $56 million, compared with $422 million during the previous-year period. Revenue dropped 40% to $1.35 billion, from $2.26 billion.

Universal Pictures Home Entertainment reported a 25% decline in revenue, primarily due to the strong performance of several releases in the prior year period, including Fifty Shades of Grey.

The movie ranked 11th in combined DVD/Blu-ray Disc sales in 2015 with $55.3 million generated on 3 million discs, according to The-Numbers.com.

Jurassic World, Furious 7 and Minions ranked 1st, 2nd and 6th, respectively, generating nearly $278 million in combined revenue on more than 15 million discs sold. Pitch Perfect 2 ranked 13th with $37 million on 2.4 million discs.

Content licensing revenue in Q2 increased 63%, primarily due to the timing of availability of content in the premium TV window.

Other revenue increased more than 24% due to higher Fandango sales. The online ticket vendor recently launched Fandango Now, a transactional VOD and electronic-sellthrough platform.

Studio operating cash flow (income) decreased nearly 87% to $56 million, reflecting lower revenue, partially offset by lower programming and production costs.

The decrease in programming and production costs were primarily due to lower amortization of film production costs in the current year period due to the studio’s larger film slate in 2015.

Indeed, through the first six months of 2016, Straight Outta Compton ranks as Universal’s top-selling retail release with nearly $26 million in revenue on 1.4 million discs sold.

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