Disney (and others) at the Box Office - Current State of Affairs

[Disney Irish]

Unless we’re in Hogwarts, snapshots are exactly that - a fixed picture from a moment in time. The quarterlies reflect the financial picture as of the end of that quarter (e.g., March 29, 2025). It is a snapshot of the financial health of a publicly traded company at the end of that quarter.

Well I guess we have different definitions. Because a snapshot is meant to be a check on where things are BEFORE you hit the end of the quarter in order to make sure you'll still hit your targets.

But I don't care what term you all want to use. The box office is not a complete picture, never has been, never will be.

 

[Disney Irish]

I think we have different definitions of meaningless. Best of luck in your business endeavors

We must, and thanks my business endeavors are doing just fine.

Anyways, I think the idea of using just the box office to determine if a movie is a profit or loss for a studio is a fool errand as its not a complete picture. And I think you agree for the most part, even if we disagree on the definitions of some business terms.

 

[Tony the Tigger]

True, matinee shows were cheaper. And then they added discount days, so it used to be just Tuesdays were discount days all day. Now they've added a second day, and I've seen talks about more. This shows they aren't getting the bodies in the theaters they expect, ie they are worried as ticket sales continue to dwindle year-after-year.

Also, ticket prices have gone up considerably, so cutting back on a slow day #1 is just turning back the clock to more reasonable pricing and #2 making the day more profitable by increasing volume. (Selling 5 tickets at $15 = $75. Selling 15 tickets at $7.50 = $112.50 + concessions for 10 more people. This is in no way bad.

A snapshot is meaningless, even opening weekend, especially when trying to use it to frame a narrative of success or failure and profit/loss

I understand what you are saying in the context of this thread. In the larger context, opening weekend numbers have long been tracked, broken records acknowledged, etc. In that context, they are not meaningless. I don’t think you were saying they were, but I think someone is reacting to your phrasing.

The problem though is that those that like to use this for framing a narrative never come back and do an addendum to their "summary" of profit/loss. They just flat out state its a failure (or success) with their "math" and wash their hands of it, until the next time they want to bring up said movie to point to as a failure because of "narratives" without again updating it for the post-theatrical numbers.

This is the reason why several of us try to give those updates real time to give a complete picture.

Yup.

No, they aren't. They are incomplete, but they are not meaningless.

I agree, but I think we should note his qualifier: “…especially when trying to use it to frame a narrative of success or failure and profit/loss.”

In the context of this thread, people have jumped to conclusions based on opening weekend numbers, which did turn out to be meaningless when the film “had legs” and became profitable later in its run than is typical. (Mufasa.)

Anyways, I think the idea of using just the box office to determine if a movie is a profit or loss for a studio is a fool errand as it’s not a complete picture.

Again, yes - if using it to determine P or L overall. But it’s a longstanding metric we’ve tracked and used (and still use) having little to do with the overall profitability discussion. It stands on its own.

And again, even though you are putting qualifiers, I can see how folks may misunderstand to think you’re saying these numbers have no meaning overall.

 

[TP2000]

As I said just run your equation, but don’t use a theatrical marketing budget of 50%, but 25% (for the theatrical window and ignore the other half spent post theatrically) and you’ll get the same result.

Wait, what? We're now saying that the average marketing budget is only 25% of the production budget, instead of the historical estimate of 50%? What happens when Disney itself brags they spent a specific dollar amount, like the $140 Million they spent on The Little Mermaid in 2023? (More than the 50% of the budget, which should have been $125 Million).

Do we just pretend Disney only spends 25% of the production budget on marketing, until they admit they actually spent 60%?

I’ve long heard that marketing costs can be reasonably estimated at half of the budget for major movies. We’re saying it’s now 25%?

Thank God it's not just me.

Yup, the more complicated answer is 50% is the marketing floor, it’s way underestimated. We have absolutely zero validated tool to calculate marketing because it’s so highly elastic to how it does initially. I’ve seen a few case examples where it’s 40% and that’s largely on the rug pulls for very expensive films that fall out of the gate. When movies go big we often see marketing budgets pushing 80… 100%. The floor on Illumination films is usually more like 100%+. They save in production but spend like Disney-esque.

Oh, geez. So 50% of the production budget is the "floor" for the average marketing budget of almost all movies, and on some really big movies (Barbie? Toy Story 6? Avatar 7?) they spend 80% to 100% of the production budget on marketing?

But for the purposes of this thread, we need to pretend that Disney only spends 25% of the production budget on global marketing for their mega-budget tentpole movies from Marvel, Lucas, WDAS, Pixar, etc.?

I do appreciate your willingness to engage on this topic @BrianLo, but I just can't make the equation 50% to 80% = 25% work inside my pea-sized brain. Granted, it's very late and I've been at the Pinot Noir again. But I'm going to stick with the historically established ballpark figure that a major movie studio spends 50% of a movie's production budget on global marketing.

And I'll just accept that 50% is often a lowball figure for the box office breakeven points, and for some of these movies it's even higher than what we're throwing around here.

 

[Disney Irish]

Wait, what? We're now saying that the average marketing budget is only 25% of the production budget, instead of the historical estimate of 50%? What happens when Disney itself brags they spent a specific dollar amount, like the $140 Million they spent on The Little Mermaid in 2023? (More than the 50% of the budget, which should have been $125 Million).

Do we just pretend Disney only spends 25% of the production budget on marketing, until they admit they actually spent 60%?



Thank God it's not just me.



Oh, geez. So 50% of the production budget is the "floor" for the average marketing budget of almost all movies, and on some really big movies (Barbie? Toy Story 6? Avatar 7?) they spend 80% to 100% of the production budget on marketing?

But for the purposes of this thread, we need to pretend that Disney only spends 25% of the production budget on global marketing for their mega-budget tentpole movies from Marvel, Lucas, WDAS, Pixar, etc.?

I do appreciate your willingness to engage on this topic @BrianLo, but I just can't make the equation 50% to 80% = 25% work inside my pea-sized brain. Granted, it's very late and I've been at the Pinot Noir again. But I'm going to stick with the historically established ballpark figure that a major movie studio spends 50% of a movie's production budget on global marketing.

And I'll just accept that 50% is often a lowball figure for the box office breakeven points, and for some of these movies it's even higher than what we're throwing around here.

View attachment 858941

The idea is that since you all want to calculate profit/loss during theatrical only you should only count the theatrical marketing. The 50% number thrown around is for ALL marketing for the entire life of the film and includes post-theatrical marketing too, and yes in many cases is the floor. But since you guys don’t want to consider amounts made post-theatrical toward your profit/loss totals then you shouldn’t also then count the total marketing either. It’s only fair in that scenario, otherwise you’re just artificially inflating the cost of a film and attributing it to theatrical only when it’s not.

 

[brideck]

Wait, what? We're now saying that the average marketing budget is only 25% of the production budget, instead of the historical estimate of 50%? What happens when Disney itself brags they spent a specific dollar amount, like the $140 Million they spent on The Little Mermaid in 2023? (More than the 50% of the budget, which should have been $125 Million).

Do we just pretend Disney only spends 25% of the production budget on marketing, until they admit they actually spent 60%?

The point is that we're trying to come up with a best-fit estimate to the profit/loss numbers that are eventually reported. Any formula we can come up with (and the justification for it) is a fiction because we're not privy to the complicated contractual details that go into making any movie, so we're just looking for something that best fits the reality of what is reported (both via Deadline and via Disney's quarterly numbers).

Brian's formula using 25% is a much better fit than what you normally post. The average miss for the four movies below was only $17m. [The average miss in the 20 movies Deadline reported on for their end-of-year 2024 articles was $41.6m.]

And just real quick, Brian Lo had done this previously hundreds of pages ago, but here's checking the formula being used against Deadline's tail of the tape for the four biggest bombs of 2023.

View attachment 858534

Deadline had these as:
Marvels -$237m
IJ 5 -$143m
Wish -$131m
HM -$117m

Feel free to reshare your numbers for these 4 BOMBS!!!!1! so we can see what the difference looks like. Maybe then you could see why this is better, even though it hurts your brain to try to bend it to something that feels real to you.

 

[Sirwalterraleigh]

The goal is to make money of course, especially for movie only studios. But for Disney, there's also the goal of making life long fans. That's why Disney parks and Disney+ do consistently well even when they don't have the latest hot hit. They don't solely need to rely on the latest blockbuster to draw in guests.

That’s what they are risking…more than immediate return…by tanking material

Especially if it’s bad major franchises

 

[Sirwalterraleigh]

All while willingly handing over thousands of dollars a year on multiple trips...

How long have you been my travel agent?

And that would require accepting mistakes from a gigantic corp?

…that how this life thing works?

 

[Sirwalterraleigh]

I don’t even know what your point is anymore.. doing these little dances…as far as I can tell Bob Iger has really affected your thought process… and are not happy with anyone giving Disney money… sort of a “ do as I say not as I do”

You are the first who made a comment on the “art house” studio…. I assumed you
Meant Searchlight Studios…. You complain about others with excuses…. Most others on this board I have not seen change their thoughts But you created so much confusion with your word salad…just to spin a Disney is a failure narrative

The point always is stop making excuses for Disney mistakes

The do need them, want them, or care about them.

Pretty basic. Consumer/supplier thing

 

[Tha Realest]

Don’t you know? When companies spend $2M to show their trailer during the Super Bowl in February for a movie coming out in July half of that money is marketing for the digital on demand release in October

 

[brideck]

Don’t you know? When companies spend $2M to show their trailer during the Super Bowl in February for a movie coming out in July half of that money is marketing for the digital on demand release in October

Intentional misunderstanding is always super clever around these parts. The likes will be sure to roll in.

 

[Tha Realest]

Intentional misunderstanding is always super clever around these parts. The likes will be sure to roll in.

Post-theatrical window marketing is a small fraction of the time and effort. It’s intellectually dishonest to suggest 50% of the marketing costs occur after the first weekend or two of a film’s release. So yes, this suggestion deserves ridicule.

Ana de Armas is all over the place promoting the upcoming theatrical release of Ballerina. Will she be on GMA again the day before it randomly drops on Peacock?

 

[brideck]

Post-theatrical window marketing is a small fraction of the time and effort. It’s intellectually dishonest to suggest 50% of the marketing costs occur after the first weekend or two of a film’s release. So yes, this suggestion deserves ridicule.

Ana de Armas is all over the place promoting the upcoming theatrical release of Ballerina. Will she be on GMA again the day before it randomly drops on Peacock?

Did you miss my post about how we're not really looking to model reality in any detail because we don't know reality? Even the budget numbers that everything hinges off of in the first place don't necessarily match reality. Any rationalization given is just a simple warm fuzzy to try to make someone feel good about why a certain formula works or not. The reality is way more complex and beyond our ken here.

But. We've arrived at something that comes fairly close to what gets reported, so why not use it? Oh, I know why. Because it doesn't feel good.

 

[Disstevefan1]

Did you miss my post about how we're not really looking to model reality in any detail because we don't know reality? Even the budget numbers that everything hinges off of in the first place don't necessarily match reality. Any rationalization given is just a simple warm fuzzy to try to make someone feel good about why a certain formula works or not. The reality is way more complex and beyond our ken here.

But. We've arrived at something that comes fairly close to what gets reported, so why not use it? Oh, I know why. Because it doesn't feel good.

Unless is a massive box office hit filling theaters where it’s obvious a given movie is a success, we don’t know if a given movie makes money, breaks even, or losses money.

Even the movies that play to empty theaters, we don’t know just how much money they lose.

 

[DKampy]

The point always is stop making excuses for Disney mistakes

The do need them, want them, or care about them.

Pretty basic. Consumer/supplier thing

I don’t believe any of us say Disney never makes mistakes…. But differing of opinions is not excuses…. I will admit I
Am more of a wait and see… hope for the best…. As life is more enjoyable if you stay positive… that is not to say my eyes are not closed if Disney does something I don’t care for

I also don’t obsess over Bob Iger every waking moment…. But hey stay grumpy

 

[BrianLo]

[…]wait what 25%

Oh, geez. So 50% of the production budget is the "floor" for the average marketing budget of almost all movies, and on some really big movies (Barbie? Toy Story 6? Avatar 7?) they spend 80% to 100% of the production budget on marketing?

But for the purposes of this thread, we need to pretend that Disney only spends 25% of the production budget on global marketing for their mega-budget tentpole movies from Marvel, Lucas, WDAS, Pixar, etc.?

I do appreciate your willingness to engage on this topic @BrianLo, but I just can't make the equation 50% to 80% = 25% work inside my pea-sized brain. Granted, it's very late and I've been at the Pinot Noir again. But I'm going to stick with the historically established ballpark figure that a major movie studio spends 50% of a movie's production budget on global marketing.

And I'll just accept that 50% is often a lowball figure for the box office breakeven points, and for some of these movies it's even higher than what we're throwing around here.

I’m just trying to find some way to break through to you that a movie isn’t:

(Box Office - Production + inaccurate stab at marketing).

You can’t keep sticking to something that has yet to produce a result we can verify.

(60/40 splits of Box office -(2.5*budget)/2

No assumption about marketing, because marketing is highly elastic to performance.

Post-theatrical window marketing is a small fraction of the time and effort. It’s intellectually dishonest to suggest 50% of the marketing costs occur after the first weekend or two of a film’s release. So yes, this suggestion deserves ridicule.

How about 80% of production and 45% of marketing then?

Is it kind of stupid? You bet. But any logic went out 500 pages ago when we kept reverting to an equation that produced a useless number. Because of the sheer refusal to consider that ALL movies are budgeted against their entire front and back end runs.

One cannot be untangled from the other and I’m really not sure why it has to be. See my Disney parks ticket revenue analogy. Just use the validated thing from the 90’s and move on.

 

[BrianLo]

Did you miss my post about how we're not really looking to model reality in any detail because we don't know reality? Even the budget numbers that everything hinges off of in the first place don't necessarily match reality. Any rationalization given is just a simple warm fuzzy to try to make someone feel good about why a certain formula works or not. The reality is way more complex and beyond our ken here.

But. We've arrived at something that comes fairly close to what gets reported, so why not use it? Oh, I know why. Because it doesn't feel good.

Exactly. We don’t purport to know anything. Anything about costs, anything about revenue. Just a stab on the end.

It’s a very difficult leap of logic and I understand why it’s hard to break through. A lot of people are really stuck thinking 1.5X a production budget is what total costs are and that’s the first major fallacy. We know it’s multiples.

I thought some of the deadline sheets would break through; but here we are. I think justifying it really just makes it worse. Trying to explain it just makes it worse. At the end of the day we have three to four pieces of info - production budgets, box office, deadline sheets, financial studio outcomes. The rest is just… hard to break through and the other 90% obstinance.

 

[Disney Irish]

Exactly. We don’t purport to know anything. Anything about costs, anything about revenue. Just a stab on the end.

It’s a very difficult leap of logic and I understand why it’s hard to break through. A lot of people are really stuck thinking 1.5X a production budget is what total costs are and that’s the first major fallacy. We know it’s multiples.

I thought some of the deadline sheets would break through; but here we are. I think justifying it really just makes it worse. Trying to explain it just makes it worse. At the end of the day we have three to four pieces of info - production budgets, box office, deadline sheets, financial studio outcomes. The rest is just… hard to break through and the other 90% obstinance.

I don't even know why we're dancing around it anymore. We know the exact reason why it doesn't break through, its because any other metric is seen as trying to defend Disney and make them look good and they can't have that. So they stick to a formula that is shown to make Disney look bad even if its not close to accurate and around in circles we go.

 

[brideck]

its because any other metric is seen as trying to defend Disney and make them look good and they can't have that.

Which is just silly because saying that Snow White has essentially lost as much as The Marvels did in 2023 (which this formula indeed shows) is bad. The next two worst movies from the past 2.5 years lost about $100m less than each of those did.

But it's also true that Disney is pretty especially positioned to be able to absorb those kinds of failures. They've been doing it for decades.

 

[BrianLo]

I don't even know why we're dancing around it anymore. We know the exact reason why it doesn't break through, its because any other metric is seen as trying to defend Disney and make them look good and they can't have that. So they stick to a formula that is shown to make Disney look bad even if its not close to accurate and around in circles we go.

It’s vaguely in my nature and day job to repeat myself from various angles for the 20th time years later.