Dreamworks Shifting Away From In-House Production In Los Angeles

Due to the cyclical decline in business, rising production costs and strikes, DreamWorks Animation will lay off 4% of its employees, approximately 70 positions. Affected positions span the company’s executive, film, television and technology departments. As part of cost-cutting measures, Dreamworks Animation is shifting away from producing films fully in-house at its Glendale, California studio and will rely more heavily on third-party studios. The studio’s chief operating officer Randy Lake laid out the studio’s plans last month.

Dreamworks, along with Walt Disney Animation Studios, stood as the last of the major feature animation studios in Los Angeles that still did the production for some (not all) of its films entirely in-house. Two of its feature films planned for next year – Kung Fu Panda 4 and The Wild Robot – are being produced entirely in-house, with only the direct-to-streaming feature Orion and the Dark being produced by a partner studio.

But that will all change in 2025, according to Lake’s presentation to workers. None of the studio’s three films currently slated for 2025 will be made fully in-house.

Two of Dreamworks’ films in 2025 – the previously announced Dog Man and an unannounced film – will be produced entirely at vendor studios, similar to how the studio produced Spirit Untamed and Captain Underpants: The First Epic Movie. A third film – an unannounced sequel – will be made using the studio’s new “mixed production model,” in collaboration with Sony Pictures Imageworks.

Imageworks, which has production studios in Vancouver and Montreal, is the main animation studio for Sony Pictures Animation, handling the Spider-Verse and Hotel Transylvania franchises, but it also serves as a vendor studio, producing animated films for companies like Netflix (The Sea Beast, Over the Moon) and Warner Bros. (Storks, Smallfoot).

According to comments that Dreamworks evp of feature production Erika Burton made to workers last month, Dreamworks will handle all creative front end of the unannounced sequel (story, art, editorial, previs), as well as approximately 50% of the asset build and one hour of production. Imageworks will handle the other 50% of asset builds and 20 minutes of shot production. While this is the current thinking of management at Dreamworks, Burton said that the exact percentages were still being worked out and subject to change.