Do you stream movies more or watch them in the theater? Increasingly, the former seems to be the go to option, especially for younger generations. This has seriously hurt Hollywood’s revenue, leaving them in a precarious position for the upcoming summer movie season.
Hollywood needs a blockbuster summer to reverse the ongoing decline in box office revenues. With domestic ticket sales down roughly 20% from 2023 and 40% from 2019, it seems like they never full recovered from the pandemic. This trend could be explained by the rising popularity of streaming, which cemented itself during the pandemic.
The industry is relying on major franchises to draw audiences back to theaters. This year, the highest-grossing films so far have been sequels or reboots: Dune: Part Two, Godzilla x Kong: The New Empire, Kung Fu Panda 4, and Ghostbusters: Frozen Empire.
The upcoming summer lineup continues this trend, with Kingdom of the Planet of the Apes debuting this weekend, followed by Deadpool & Wolverine, Despicable Me 4, and Inside Out 2.
The Summer Box Office Outlook
Despite the heavy reliance on established franchises, the summer box office faces significant challenges. With only one superhero film on the schedule — Marvel Studios’ Deadpool & Wolverine , ticket sales from the U.S. and Canada are expected to reach just $3 billion. This would mark a sharp decline from last summer’s $4 billion haul, driven by the unprecedented success of “Barbenheimer.”
The box office has been impacted by production delays due to the writers’ and actors’ strikes, as well as budget cuts by studios. The last time the summer box office was as low as $3 billion (excluding the pandemic years of 2020 and 2021) was in 2000, when movie tickets were significantly cheaper.
A Shaky Start to the Summer
The summer box office began without the boost of a superhero film, and the industry felt it. Universal’s The Fall Guy, starring Ryan Gosling and Emily Blunt, opened with a disappointing $27.7 million despite positive reviews. The weekend’s top 10 movies grossed just $68 million, a 56% decline from . Cinema operators are in dire need of more compelling content, as noted by Roth MKM analyst Eric Handler.
Starting the Summer with a big franchise blockbuster, like the Avengers, has historically been a solid strategy, so it is somewhat confusing for Hollywood to skip such a production. That being said, the film industry has faced some significant difficulties over the past year, which could have contributed to this lack.
The Industry’s Struggles
The movie industry is still grappling with the effects of a six-month production hiatus due to the SAG-AFTRA strike. On top of that, it has to contend with changing audience preferences. David A. Gross of FranchiseRe reported that April’s domestic box office was down nearly 48% compared to pre-pandemic averages. The revenue from January through April was also down 43% from pre-COVID levels. The mood at mid-April’s CinemaCon, the theater owners’ annual Las Vegas pep rally, was notably subdued.
Potential Bright Spots
While this summer may be a slow burn overall, some films have the potential to shine. Disney’s Kingdom of the Planet of the Apes is projected to be a huge hit. Later in May, Warner Bros.’ Furiosa: A Mad Max Saga and Sony’s Garfield will debut. June will see the release of Sony’s Bad Boys: Ride or Die and Pixar’s Inside Out 2, with July expected to get a boost from Illumination’s Despicable Me 4.
Disney’s Kingdom of the Planet of the Apes, with its $160 million production cost, aims to match the box office performance of its predecessors. With international ticket sales expected to add significantly to its revenue, the film could reach a global total of $130 million to $140 million in its opening weekend.
David Herrin, CEO of tracking firm the Quorum, noted that there are many weekends this summer without major releases, a rare occurrence that could hurt the overall box office performance. These gaps may benefit holdover films but are detrimental to the industry and theaters.
Disney’s Redemption
Disney hopes to recover from recent flops with Deadpool & Wolverine and Inside Out 2, both based on beloved intellectual properties. Other studios have high stakes as well, including Warner Bros.’ Horizon: An American Saga and several prequels like Furiosa and A Quiet Place: Day One.
Original Films and the Future
A few original films will attempt to find audiences, such as Apple’s Fly Me to the Moon and M. Night Shyamalan’s Trap. Success for these films could indicate a healthier theatrical market.
After all, last year, it was two relatively original films (Barbie and Oppenheimer) that drove the box office revenues. This may be the real key to unlocking a larger market share, provided the films are creative and interesting enough.
As the summer progresses, Hollywood will closely watch whether these new entries in beloved franchises can reignite interest in the blockbuster and pull audiences away from the increasingly dominant streaming services. Theater owners are counting on big turnouts for upcoming releases to salvage what remains a critical season for the industry.
