Prior to the pandemic, assessing the financial success or failure of a film was relatively simple and finite.
For a big-budgeted movie, the volume of ticket sales collected in its first three days in movie theaters gave a good indication of whether or not it would be profitable. There were exceptions, of course, but for the majority of studio movies, all it took to read the box office tea leaves was a quick look at opening weekend revenues.
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COVID-19 has scrambled that calculus. The movie theater business is still struggling to recover from the public heath crisis, reshaping the criteria for success and making it exceedingly difficult to separate the hits from the misses.
Take last weekend’s new release, Disney’s “Jungle Cruise.” The family friendly tentpole, starring Dwayne Johnson and Emily Blunt, debuted atop North American box office charts with $34 million. It generated $27.6 million internationally and $30 million on Disney Plus, amounting to $90 million in combined revenues. In any other environment, that would have been catastrophic because the film cost the studio $200 million to produce and at least $100 million more to market. Box office experts estimate it would have needed to generate at least $500 million at the global box office to have a chance of breaking even. For back-of-the-cocktail-napkin math purposes, studios and movie theaters essentially split ticket sales.
Yet in the COVID era, the $34 million domestic debut of “Jungle Cruise” exceeded industry expectations and ranks on par (or slightly above) previous all-audience offerings like “Space Jam: A New Legacy” ($31 million), “Godzilla vs. Kong” ($31 million) and “Cruella” ($21 million). Despite boasting two bankable movie stars in Johnson and Blunt, however, the film didn’t come close to matching “Black Widow” ($80 million), “F9” ($70 million) and “A Quiet Place Part II” ($47 million), which were all sequels in popular, pre-existing franchises. Only “Black Widow,” “F9: The Fast Saga” and “A Quiet Place Part II” came close to the opening weekend hauls that would have been expected prior to the pandemic, and even they fell a little bit short of planet-straddling, universe-shaking blockbuster status and look to lose money.
“At this point, the recurring theme on these day-and-date releases is that they’re merely fine in the best of times, and even that feels generous to say,” says Shawn Robbins, the chief analyst at Box Office Pro. “Success is extraordinarily relative right now and hard to qualify.”
Around 85% of U.S. cinemas have reopened, according to Comscore, which is the highest percentage since March 2020. But as concerns about the Delta variant rise, the moviegoing landscape is nowhere near what it used to be and it’s unclear when, or even if, things will get back to normal. With that in mind, is it fair to categorize a movie as a disappointment given the still-impaired marketplace? Or is it reasonable because, in the case of “Jungle Cruise,” it may not dig itself out of the red to justify its production budget? “Jungle Cruise” is far from the only movie that won’t come close to earning the revenues that the studio expected when it was initially greenlit. Hybrid releases or not, it’s been a similar fate for everything from “Tenet” and “Wonder Woman 1984” to “In the Heights” and “Snake Eyes.” Almost all of these movies will fail to achieve profitability.
“‘Jungle Cruise’ was weak because, even without headwinds, it’s so far from what would be considered good,” says David A. Gross, who runs the movie consulting firm Franchise Entertainment Research. “That movie needed to open at $80 million to $100 million to fulfill its tentpole aspirations.”
During the pandemic, studios delayed their biggest blockbuster hopefuls for as long as possible. Once COVID restrictions began to ease and indoor venues were able to loosen capacity constraints, Hollywood companies started to add their films back to the release schedule. Since movie theaters hadn’t (and still haven’t) reached any semblance of normalcy, studios, particularly Disney, Warner Bros. and Universal, created a streaming component to offset expected losses. In the case of Disney and Warner Bros., their high-profile tentpoles were slated to premiere on the studio’s respective streaming services to mitigate any theatrical losses and hopefully boost streaming service subscribers in the process. Those subscribers were, in some sense, even more valuable than traditional customers are, because for a Disney or a Netflix, growing that audience can goose their share price. Wall Street cares a lot more about churn on Disney Plus and a lot less about how “Jungle Cruise” did in international markets.
But having a movie available at home on the same day as its theatrical release creates another challenge. Detractors of the day-and-date method of releasing a movie argue that putting a film on a streaming service cuts into the film’s traditional premium video-on-demand window. Following the release of “Black Widow,” the National Association of Theatre Owners criticized Disney and the huge second-weekend decline of the Marvel hero. “It ignores that Premier Access revenue is not new-found money,” the trade organization said in a statement. “Combined with the lost theatrical revenue and forgone traditional PVOD revenue, the answer to these questions will show that simultaneous release costs Disney money in revenue per viewer over the life of the film.”
So far, “Black Widow” has generated $343 million globally, making it both among the highest-grossing movies of the pandemic and by far the lowest-grossing Marvel movie. Prior to the pandemic, it would have been expected to surpass $1 billion worldwide. Scarlett Johansson, the actor who portrays Black Widow, sued Disney last week, alleging the studio’s decision to put the Marvel tentpole on Disney Plus was a breach of contract and cost her tens of millions in backend deals. Disney, in return, has claimed Johansson benefitted from its hybrid release on Disney Plus and asserted her lawsuit showed “callous disregard for the horrific and prolonged global effects of the COVID-19 pandemic.”
Overall, the domestic box office collected $76 million between Friday and Sunday, according to Comscore analyst Paul Dergarabedian. That’s well below any traditional weekend tally in a pre-COVID era, though it ranks as one of the best weekends since March of 2020.
“We are not where we were a year ago, but we’re still not in a normal marketplace,” he says. “It’s difficult to apply any traditional analysis to these numbers.”
In pandemic times, does that mean a $30 million opening weekend is the new $100 million? For the sake of Marvel’s “Shang-Chi and the Legend of the Ten Rings,” the James Bond sequel “No Time to Die” and other $200 million-plus budgeted movies slated for 2021, Hollywood certainly hopes not.
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