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Several things contributed to the huge decline in profits for the World Wrestling Entertainment Co. (WWE) for the quarter; the major one causing the most concern from a business standpoint is the company's inability to produce a film that makes money. All three movies offered by WWE films: The Condemned, The Marine, and See No Evil, have performed horribly at the box office, and haven't contributed any revenue for the company; including post-release sales.

The last quarter "The Condemned," starring WWE wrestler "Stone Cold" Steve Austin, only took in a total of $7 million in receipts, even with a distribution partner like News Corp. (NWS-A). As a result the company had to take a $15.7 million charge. If the company wants to compete in the box office space, it'll definitely have to raise the level of the films it's producing.

After the charge, the company was only able to bring in $7 million in profits for the quarter, in comparison to last year's $14.7 million. The result was only $0.10 earnings per diluted share. Without the charge the company would have had net income increase to $0.23 per diluted share.

In spite of the charge, overall revenues increased by 15 percent to finish at $137.5 million. The digital media and consumer products units performed strongly, both growing buy about 30 percent, and the buy rates for Wrestlemania increased to 1.2 million from 958,000 last year. Subscribers to the video-on-demand 24/7 subscription service also keeps on growing.

Still, buy rates to all the pay-per-view events decreased to 2.1 million from 2.2 million from the previous quarter. That isn't good news for that company as it's one of the major drivers of revenue for the business.

Since the murder/suicide of Chris Benoit and his family, the stock has dropped 8 percent. Some people think it's connected directly to the deaths, and maybe it is. Over the short-term the company has taken a hit from it, and also the continuing investigation into drug and steroid use in the industry. But when you consider the demographic the company serves, it's probably not going to make much difference over the long haul.

Saying that, the company could be impacted if any other types of tragedies emerge any time soon. They will need to take a more proactive involvement in these areas to help prevent it from becoming a reputation problem that even their demographic tires of.