SEC Animates Pixar With Info Request

    August 26, 2005
    WebProNews Staff

Pixar’s travails with larger than predicted returns of its superhero DVD title “The Incredibles” have attracted regulatory attention.

It looks like Steve Jobs, Pixar and Apple CEO, will be receiving an iProbe from the Securities and Exchange Commission. Pixar had to adjust its earnings forecasts when the laudatory movie studio had to set aside greater return reserves, as it anticipated more returns of “The Incredibles” DVD than originally thought. Now the SEC wants to gather more information on the studio’s business practices, as the Wall Street Journal reports.

DreamWorks has received an informal inquiry from the SEC regarding a similar issue with returns of the “Shrek 2” DVD. In both cases, the requests for information do not indicate any accusation of wrongdoing or other shenanigans.

But with two studios experiencing the same impacts on earnings, the SEC had to make these requests as both are publicly traded. Other Hollywood studios may be nervous this weekend, as WSJ cites how the industry has mostly avoided the scrutiny of the SEC.

It isn’t clear yet why either studio overestimated DVD demand for what had been big movie hits, particularly Pixar’s film. Don’t be surprised to hear “DVD piracy” blamed as part of the reason the studios have so many copies of the movies coming back to them.

David Utter is a staff writer for WebProNews covering technology and business. Email him here.