Pixar Faces SEC Probe Over DVD Returns

While DVD has been a cash cow for Hollywood and Pixar has reaped the benefits of that by producing a string of hit films, the animation studio is currently the target of a Securities and Exchange Commission (SEC) probe into DVD returns. Apple CEO Steve Jobs also helms Pixar.

According to an article at The San Jose Mercury News, returns of Pixaris The Incredibles DVD have been greater than expected, which caused the company to miss its earnings target for the second quarter of 2005. Neither Pixar nor SEC representatives would give additional details to reporter Dawn Chmielewski.

Ms. Chmielewski quotes an entertainment industry analyst who says that the growth rate of DVD sales is dropping off as retailers deal with an oversupply of product. Pixar rival DreamWorks Animation SKG is also the target of an SEC probe relating to high returns of Shrek 2 DVDs, in addition to being the defendant in a lawsuit alleging that the company misrepresented its projected DVD sales.