Mark O’Meara, a Virginia-based movie theater owner, wonders and worries constantly about what exactly his customers will buy tickets to see on any given weekend. It’s not that people have fallen out of love with the big screen, he says, they’ve just gotten out of practice. In fact, in the 30-plus years O’Meara has worked in the business, he’s had a front-row seat as the audiences who habitually went to the movies turned to streaming services instead.
“I’ll see people at the grocery store, and they’ll tell me, ‘You have nothing we want to see.’ I don’t blame them on certain weekends,” says O’Meara, who operates two venues in Fairfax County. “Nobody denies they consume content. That’s never been the issue. We’re competing with the convenience of the couch. Good movies sell no matter what the hell is going on. But we need more of them.”
This year, total revenues are expected to reach $30.5 billion globally, down more than 10% from 2023, which was itself nearly 20% off pre-pandemic levels. Domestic admissions, an even better gauge of the movie theater industry’s hold on the culture at large, are expected to hit approximately 800 million. In contrast, before COVID upended the movie business, cinemas were averaging roughly 1.3 billion admissions annually.
“A lot of the gains we’re seeing at the box office are due to higher ticket prices,” says Eric Handler, managing director at Roth Capital Partners. “Theaters need to do a better job of promoting the cinema experience and getting people to come back.”
Over the past few years, the movie business has suffered one setback after another. First, COVID shuttered theaters for months, prompting a wave of release-date delays, and halted filming on major movies, which only resumed with costly new health measures in place that added millions to budgets. Then, 2023 saw historic writers and actors strikes that scuttled production once again, resulting in another monthslong work stoppage as a fresh crop of films saw their opening weekends pushed back. All of this has left theaters with fewer films to showcase, which analysts believe is partly the cause of the decline in year-over-year revenues.
“We’re still in a post-pandemic recovery mode,” says Eric Wold, an analyst with B. Riley Securities. “It is taking time to get people to return to theaters and to have a slate that has breadth and diversity.”
So, what worked? Sequels and special effects-heavy adventures dominated the 2024 box office, while family-friendly films finally rebounded in a major way. Nine of the 10 highest-grossing worldwide releases were part of franchises (“Inside Out 2,” “Deadpool & Wolverine,” “Despicable Me 4,” “Moana 2” and “Dune: Part II” among them), while “Wicked,” the only original movie among the top earners, was adapted from a wildly popular 20-year-old Broadway musical that leans heavily on “Wizard of Oz” lore. That was in stark contrast to the previous year, when the top three releases — “Barbie,” “The Super Mario Bros. Movie” and “Oppenheimer” — arrived without a roman numeral in the title.
“It seems like everything Hollywood is offering is a sequel, a prequel or a reboot,” says Jeff Bock, an analyst with Exhibitor Relations. “But can you blame the studios? That’s what audiences are feasting on.”
When studios did try to launch original properties — or at least to produce movies like “The Fall Guy” (a reboot of a long-forgotten ’80s show) that weren’t part of long-established film series — they mostly struck out. Take “If,” Paramount and John Krasinski’s $110 million fantasy comedy, which faltered at the box office with $190 million globally, or Apple’s “Fly Me to the Moon,” a Channing Tatum and Scarlett Johansson-led “meet cute” that tapped out at $42.2 million worldwide — less than half its $100 million budget. Although the rise of streaming services like Netflix and the collapse of home entertainment offerings like DVDs have scrambled the economics of moviemaking, here’s some critical context: Exhibitors keep roughly 50% of ticket sales, so movies must double their production budgets and marketing expenses to make money theatrically. The reception of these films doesn’t make studios eager to take risks on properties that are untested.
“Audiences say they want original titles, yet they’re doubling down and supporting the safer options of titles they know,” says Disney‘s executive VP of global theatrical distribution Tony Chambers.
Many follow-up films, however, boasted grosses that rivaled those of pre-pandemic blockbusters. Disney, after a miserable 2023, enjoyed a considerable revival as “Inside Out 2” and “Deadpool & Wolverine” easily topped $1 billion, while “Moana 2” will near or even surpass that benchmark. All told, Disney will have fielded three of the five highest-grossing films of the year — the first time it’s done that in the post-COVID era.
Meanwhile, Universal and Illumination’s “Despicable Me 4” got pretty close to the billion-dollar club, earning $969 million, and Warner Bros. and Legendary’s “Dune: Part Two” notably outgrossed its predecessor, 2021’s “Dune: Part One,” with $714 million in sales. Those movies also accounted for a greater percentage of the overall box office. In 2024, at this point, the five biggest movies accounted for 32% of the marketplace. A decade ago, in 2014, the year’s top five releases made up 15% of total revenues.
In contrast, major movies that failed to connect with moviegoers were unmitigated disasters. The year’s biggest flops include “Joker: Folie à Deux,” netting $206 million worldwide on a $200 million budget, director Kevin Costner’s “Horizon: An American Saga — Part One,” which earned $38 million despite costing $100 million, and Lionsgate’s video game adaptation “Borderlands,” which cost $110 million to make and only brought in $32.9 million.
“I’m sobered by the fact that the marketplace has evolved in a way where there’s a big gap between the have and have-nots,” says Jeff Goldstein, president of domestic distribution at Warner Bros. “The ones that work are bigger than before, and the ones that miss are bigger than before.”
What’s also missing, Goldstein says, is the kind of modestly successful singles and doubles that once powered the industry. “You used to be able to have a middle class that made up the bulk of films,” he laments. “That has shrunk.”
Strikes and pandemics aren’t the only things that have scrambled the cinema business. The industry has also had to grapple with the changes taking place across Hollywood: namely, corporate mergers that have left the business with fewer stand-alone studios (see Disney’s acquisition of Fox) producing movies and major shifts in strategy (take Warner Bros.’ tumultuous sale to first AT&T and later Discovery) that have disrupted the old order. There’s cautious optimism that Skydance’s pending purchase of Paramount Global will at least keep one more film studio intact, given that a sale to a direct competitor like Sony could have resulted in cutbacks and even fewer movies for theaters to screen. But there’s also a realization that this era of consolidation in the entertainment industry isn’t over yet, as studios struggle to find ways to generate profits at a time when streaming and changing consumer habits have shrunk margins.
“This industry is going through a sorting-out process, and we just hope that these mergers don’t impact the number of movies that are available for us to screen,” says Michael O’Leary, chief executive officer of the National Association of Theatre Owners, an exhibition trade group. “We need compelling movies to show for all 12 months of the year.”
He’s pushing studios to increase the volume of their releases and to consider debuting more films against each other. The theater business was thrilled by the decision of Universal, Paramount and Disney to release “Wicked,” “Gladiator II” and “Moana 2” in quick succession, noting that the influx of exciting new movies grew overall revenues instead of cannibalizing ticket sales. It also inspired a wave of positive media coverage that applied a veneer of cool to a business that’s often depicted as being in dire straits.
“Competition is good for everyone,” O’Leary argues. “It draws more attention to the box office, and it builds excitement. We can handle more than one wide release a weekend.”
Quality control may be an important ingredient in the expansion of certain franchises, but impressing tastemakers isn’t always a recipe for success. Box office observers note that it’s no longer enough for a film to be good or even great to pack theaters. After all, “The Fall Guy” and “Furiosa” were well reviewed and still failed to pack a punch. Now, a movie needs to permeate the zeitgeist and have audiences feeling FOMO if they don’t go to the multiplex to see it. That’s partly how “Wicked” bucked the odds and became the rare Broadway adaptation to connect with moviegoers, many of whom wore pink and green, the signature colors of the film’s witchy protagonists, to the cinema.
“We’re all quite clear-eyed about the fact that you need to create a sense of urgency to get films to work at the box office,” says Peter Cramer, president of Universal Pictures. “I wish I could say that casual moviegoing was as strong as it needs to be, but it’s not. We need to drive people to get out of the house.”
Being part of a franchise isn’t enough to guarantee a monster opening weekend, either. “Dune: Part II,” for example, improved upon the box office returns of its predecessor in part because critics praised it for being deeper and more emotionally involving than the first film; sequels like “Inside Out 2” and “Deadpool & Wolverine” also enjoyed positive reviews. In contrast, “Joker: Folie à Deux” was hobbled by scathing notices that faulted the film for failing to come up with enough of a reason for being.
“Audiences can sense when sequels exist just because studios needed to make another. It has to be earned and executed with the highest-possible quality,” says Blair Rich, chief marketing and commercial officer at Legendary, the producer of “Dune” and “Godzilla x Kong: The New Empire,” another of the year’s top 10 releases. “My hope is this one-size-fits-all mentality is starting to ebb, and originality is the focus again, even if it’s a sequel.”
For the first time in a long while, fewer and fewer event-driven tentpoles have been of the superhero variety. In pre-pandemic times, comic book adaptations were Teflon at the box office, but they’ve recently been greeted with grosses that are earthbound — or worse. “Deadpool & Wolverine,” Disney and Marvel’s foray into R-rated territory, was a rousing smash, but Sony’s Marvel offshoots — “Madame Web,” “Kraven the Hunter” and “Venom: The Last Dance” — were either outright bombs or lackluster compared with prior installments. This trend could reverse next year with the three Marvel sequels on deck, “Captain America: Brave New World,” “Thunderbolts” and “The Fantastic Four: First Steps,” as well as James Gunn’s “Superman” reboot, which hopes to ignite a new chapter for DC Comics. However, if these films fail to bring back fanboys or fangirls, it might signal that tastes are changing in fundamental ways.
For now, theater owners aren’t discouraged by the decline in the box office certainty of all things heroic. They feel the market is evolving to create more room for other genres to be successful as well. It wasn’t so long ago that movies featuring recognizably human protagonists, who steered clear of capes and spandex, were able to attract big crowds.
“We’re not as dependent on superhero movies,” says Chris Randleman, chief revenue officer at Flix Brewhouse theater chain. “We’re getting within a couple percentage points of the 2023 box office, and that’s with one successful comic book movie and three that bombed. We also did it with no ‘Star Wars’ or ‘Jurassic’ movies. If you told people that five years ago, they’d think you’re crazy.”
