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

[Vegas Disney Fan]

I may be naive, but if a movie makes $1 more than the entire budget, wouldn't that equate to a $1 profit?

This is true, the hard part is calculating how much a movie actually cost and how much it actually made.

Estimated budget, estimated marketing, the ridiculously complex theater/studio revenue split ratio… there’s a million unknowns.

At best it’s all a calculated guess, ballpark figure.

 

[MisterPenguin]

I may be naive, but if a movie makes $1 more than the entire budget, wouldn't that equate to a $1 profit?

If I spend $5000 total to create a business and that business brings in $5100 total, haven't I made a $100 profit? I have $100 more than I had before.

See here...

Me!

When I started tracking this stuff, I did my due diligence. The formula is the one Deadline and other trade mags use. Other websites corroborated such calculations. When Deadline, e.g., publishes an article with a list of the top ten profitable movies for the year... it's this formula they use.

And the formula exists because studios won't release actual figures. So, it's just a 'rule of thumb' based on data that is sometimes definitively known about a few movies, which is then extrapolated to all movies.

So, here is the reasoning...

In addition to the budget to make the movie, a studio spends *on average* another 50% of that budgetary number on advertising and other administrative fees. I presume the cost of distribution is a big part of that.

And the Box Office receipts are split between the studios and the theaters. Now, when a movie is first released, the studio's cut is more than 50%... maybe more like 60%. But over time as the movie plays, the theater gets a bigger and bigger cut. But that's domestically. Internationally, the theaters get the larger cut. So, as a rule of thumb *on average* the receipts are just considered equally split.

And again, this rule of thumb is because we don't know the real figures. We don't know if a studio decided to spend a minimum on advertising because they didn't think the movie would do well, or splurged on advertising for a blockbuster.

That's why I keep emphasizing it's a "rule of thumb" and "on average." And that a final bottom line of anywhere from a profit of $10M to a loss of $10M should be considered 'break even' because of the vagaries of the black box of studio accounting.

The benefit of the Rule of Thumb is the ability to compare one movie's finances to another with an equal hand and make the comparisons more equitable and not based on 'feeling,' such as when people say, "Surely it made a huge profit because me and all my friends saw it and liked it!!!

 

[MisterPenguin]

"Our after hours events are selling out"

"Our extra ticketed special events..."

Since they have the new hollywood holiday one, that would be probably exactly what it is spun to.

Actually... low attendance of day folk and sell outs of upsell events means that they got a higher 'yield', IOW, more money per person.

Wall Street loves that figure.

 

[Disney Irish]

This is true, the hard part is calculating how much a movie actually cost and how much it actually made.

Estimated budget, estimated marketing, the ridiculously complex theater/studio revenue split ratio… there’s a million unknowns.

At best it’s all a calculated guess, ballpark figure.

Not to mention all the incentives, tax breaks, rebates, etc. that movie studios get on these productions that are never accounted for in any of these discussions.

 

[Casper Gutman]

…it’s not gonna cover…or come close

This is the 1,001 th attempt to suggest it will make money when it won’t.

Day ending in “y”

You are wrong about this. You have been proven wrong by the citation of reliable sources again and again and again.

TLM underperformed internationally. Indy will lose money. There is a lot for you to harp on about without lying.

 

[Casper Gutman]

Penguin, out of genuine curiosity and not doubting you, but could you cite a specific source for the formula, specifically one that explains its usage by the trades?

 

[Disney Analyst]

Since none of us here have the "real" numbers for these movies budgets and marketing I would trust the math of a Disney executive over the math of some of random posters on a Disney Fan Forum, sorry.

Also interesting to see them discuss all the different costs that go into or are accounted in a Pixar budget.

 

[Jedijax719]

Got it! So that 2.5 multiplier factors in the cut a studio makes vs what theater chains make. In my meager example of $5000, I assumed both production and advertising, something that is often left out of the mix.

 

[Disney Irish]

The movie’s production budget is a reported $250M.

It was a major global tentpole release with a combined marketing and distribution budget of $100M+++ (probably more likely around $125M-$150M).

Let’s stop the silliness.

It's also been reported in an article found and posted in this thread by @wtyy21 that TLM got at least $57.5M in rebates and incentives during production, which actually brings down the budgets to under $200M. Which based on current box office, put its within breakeven territory.

 

[Mmoore29]

Profit from the box office alone?

Its at 425,243,716,

It cost 200m to make and lets really low ball it for marketing and say 50m that 250x2 = 500m at the box office to break even.

Not there yet.

It already has crossed the $560 million threshold when all ticket sales worldwide are counted, is climbing up to $600 million from the remaining overseas market. This is not a flop by any standard.

"Why isn't it higher?" Because trolls and the media put their thumb on the scale to make it so. Everyone wants to kick Disney in the teeth. But Elemental is profitable, so is TLM, and a lot of the upcoming slate will be.

 

[Mmoore29]

…it’s not gonna cover…or come close

This is the 1,001 th attempt to suggest it will make money when it won’t.

Day ending in “y”

The 5001th attempt to lie and move the goalposts and call it a flop when it isn't.

Yes, it is indeed a day that ends in "y."

 

[celluloid]

Imagine giving 100 dollars to a person to is pretty sure they can get you an almost guaranteed profit.

They come back in two years and give you 99 of the 100 back and.say, wait. Just another month and the profit is coming.
You then get the two more dollars.

Great. You got 102 dollars for investing for two years and 100 dollars into them.

2 percent profit and two years of waiting.

Now think on a larger scale.

Disney would have made more money putting that many millions in banks than what a lot of their films brought in, in profit. Some did not even do that.

As said. It is more than just covering the cost of the movie to keep going. You want company growth. It is even worse than not getting sequels and fatigue.

 

[Disstevefan1]

The movie’s production budget is a reported $250M.

It was a major global tentpole release with a combined marketing and distribution budget of $100M+++ (probably more likely around $125M-$150M).

Let’s stop the silliness.

Sorry for the wrong numbers!!!
250 + 150 = 400 * 2 = 800m needed to break even at the box office

Right now:
425,243,716

As I said before, not there yet.

 

[Disney Irish]

Imagine giving 100 dollars to a person to is pretty sure they can get you an almost guaranteed profit.

They come back in two years and give you 99 of the 100 back and.say, wait. Just another month and the profit is coming.
You then get the two more dollars.

Great. You got 102 dollars for investing for two years and 100 dollars into them.

2 percent profit and two years of waiting.

Now think on a larger scale.

Disney would have made more money putting that many millions in banks than what a lot of their films brought in, in profit. Some did not even do that.

As said. It is more than just covering the cost of the movie to keep going. You want company growth. It is even worse than not getting sequels and fatigue.

Nothing is guaranteed my friend.

Market conditions change, this can result in many unknowns that end up changing that return. That 2% profit is a lot of time welcome. Sure everyone would love a lot more, but again never guaranteed.

 

[Disstevefan1]

It already has crossed the $560 million threshold when all ticket sales worldwide are counted, is climbing up to $600 million from the remaining overseas market. This is not a flop by any standard.

"Why isn't it higher?" Because trolls and the media put their thumb on the scale to make it so. Everyone wants to kick Disney in the teeth. But Elemental is profitable, so is TLM, and a lot of the upcoming slate will be.

The numbers says 424m worldwide as of today.
Box office Mojo says 425m worldwide as of today.

Where do you get your numbers?

 

[Disney Irish]

Sorry for the wrong numbers!!!
250 + 150 = 400 * 2 = 800m needed to break even at the box office

Right now:
425,243,716

As I said before, not there yet.

You're giving the numbers for Elemental (who's budget was reported as $200M not $250M anyways), what is being discussed was TLM.

Two different things.

 

[Disney Irish]

The numbers says 424m worldwide as of today.
Box office Mojo says 425m worldwide as of today.

Where do you get your numbers?

Elemental has a WW total of $425M.

The Little Mermaid has a WW total of $567M

 

[Vegas Disney Fan]

Imagine giving 100 dollars to a person to is pretty sure they can get you an almost guaranteed profit.

They come back in two years and give you 99 of the 100 back and.say, wait. Just another month and the profit is coming.
You then get the two more dollars.

Great. You got 102 dollars for investing for two years and 100 dollars into them.

2 percent profit and two years of waiting.

Now think on a larger scale.

Disney would have made more money putting that many millions in banks than what a lot of their films brought in, in profit. Some did not even do that.

As said. It is more than just covering the cost of the movie to keep going. You want company growth. It is even worse than not getting sequels and fatigue.

All while inflation and costs are going up. That money, even with the 2% profit, is worth far less now than it was a few years ago.

This is my current struggle, keeping my money invested in CDs and other safe areas so it at least makes more than inflation. I miss the days of 3+% savings accounts where you could just put it in and forget about it, you weren’t getting rich but you weren’t falling behind either, my savings doesn’t even get half a percent anymore, any money sitting in it is losing value. CDs have gone way up at least, I’m making 5% on most right now.

 

[Sirwalterraleigh]

The 5001th attempt to lie and move the goalposts and call it a flop when it isn't.

Yes, it is indeed a day that ends in "y."

Who said flop?

Know your audience

It’s not a success. That isn’t a flop

Indy flopped and haunted mansion flopped

They’ve had a couple other losers..though more modest/mitigated.

They’ve had exactly 1 picture released in calendar year 2023 make a modest profit at the box office.

And before anyone says “but the stuff!!!”

Yes…they’ve sold some stuff.
Here’s how that differs from before:
They used to make money at the theater and sell a lot more stuff to make more money because so many MORE people saw it and liked it at the theater.

“New math” is hard though.

 

[Casper Gutman]

Imagine giving 100 dollars to a person to is pretty sure they can get you an almost guaranteed profit.

They come back in two years and give you 99 of the 100 back and.say, wait. Just another month and the profit is coming.
You then get the two more dollars.

Great. You got 102 dollars for investing for two years and 100 dollars into them.

2 percent profit and two years of waiting.

Now think on a larger scale.

Disney would have made more money putting that many millions in banks than what a lot of their films brought in, in profit. Some did not even do that.

As said. It is more than just covering the cost of the movie to keep going. You want company growth. It is even worse than not getting sequels and fatigue.

To the extent there is “guaranteed profit,” it is guaranteed because studios are structured to profit from content across multiple pipelines. TLM will produce this profit. If what you mean is “guaranteed box office,” that’s a naively delusional thing to expect from Hollywood and always has been.

And the demand for constant “company growth” is a wonderful way to kill a company.