Sony Pictures to slash film production unit

Will Smith in After Earth After Earth, a big-budget sci-fi starring Will Smith, failed to capture audiences' imaginations

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Sony Pictures will make a "significant shift" away from movies after it backed a number of high-profile misfires, including Will Smith's After Earth.

"Some of our movies just didn't perform as we had estimated," Sony president Kazuo Hirai told investors. "And we recognized that we must do better."

The studio aims to cut its release schedule from 23 films per year to 18.

It will also focus more on its "higher margin" TV production arm, which has produced hits like Breaking Bad.

The drama generated "10 times" the predicted revenue, and a forthcoming spin-off, Better Call Saul, will be profitable from day one, Sony said.

"Right now, we are in the golden age of television," said Steve Mosko, president of Sony Pictures Television. "The possibilities are limitless."

The company's television division, which also operates channels in 159 countries, generated $1.5 billion (£926m) in revenue over the last financial year.

By contrast, the movie business struggled - most notably with action movie White House Down, which took $205m (£127m) at the box office, against a production budget of $150m (£93m).

After Earth, a sci-fi epic starring Will and Jayden Smith, also disappointed. Budgeted at $135m (£83m), it grossed $244m (£151m) worldwide.

Last month, the studio posted a loss of $181m (£112m) for the fiscal second quarter.

Andrew Garfield as Spider-Man Starring British actor Andrew Garfield, The Amazing Spider-Man is one of Sony's most profitable franchises

Putting some of the blame on the crowded blockbuster season, Sony Pictures co-chairman Amy Pascal said the studio would only release four movies next summer, down from nine this year.

She also outlined the ways that the film division has trimmed costs - renegotiating deals with big-name stars and taking advantage of government tax breaks.

Showing a clip from The Amazing Spider-Man 2, she revealed several spin-offs from the superhero film were in the works.

"We are going to access Marvel's full world of Spider-Man characters, so be on the lookout for new heroes and villains," she added.

Sony Entertainment CEO Michal Lynton added: "We do very much have the ambition about creating a bigger universe around Spider-Man. There are a number of scripts in the works."

Other films in the pipeline include an adaption of Dan Brown's latest novel Inferno; an Angry Birds movie and a new adaptation of Popeye.

During a question-and-answer session following the presentation, Lynton was asked to explain the decision to scale back movie production.

"I want to stress right now that we in no way, shape or form lost our commitment to the movie business," he replied.

"Part of it is, how many movies can a marketing department actually handle in a quality way in a given year? When you think about it, 18 is almost one-and-a-half a month, which is a lot," he said.

"There are only so many weekends that are viable to release a picture," he added. "I know they say there are 52 weekends in a year. I'm frequently reminded that probably 40 of those really matter."

Sony has not previously been so open about its business, but is battling to win support from investors after criticism from activist shareholder Daniel Loeb.

Loeb, whose hedge fund Third Point owns about 7% of Sony, has poured scorn on management and called for drastic steps to be taken to improve the studio's profitability.

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