Two Trends Make a Downbeat 2024 Box Office Feel Worse Amid Some Hopeful Signs
The year 2024 ended far better than it appeared it would midway. At the end of June, 2024 was about 20 percent under 2023’s total of $9.1 billion, and getting to $8 billion looked questionable.
The second half rebounded with a 12 percent increase over July-December 2023, pushing the total to $9.0 billion (this number comes from Comscore, which records nearly all grosses from theaters, rather than other sources, which compile from what distributors publicly report). That’s 3 percent below last year, which looks like a win in contrast with the gloom and doom earlier.
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If that continues, 2025 would reach $10 billion. That would be a nice improvement, but some context: the record in unadjusted annual gross came in 2018, about $12 billion. At current ticket prices, though, 2018’s gross would be $15 billion. So even $10 billion for 2025 means theaters would do a third less than at the recent peak. (And that’s with the combined population of the two countries increasing by 20 million people.)
For theaters, surviving another year (those who did — though the number is uncertain, a significant amount closed, both among the top circuits and independents) with this level of business is a victory. Exhibitors have renegotiated many leases and gotten some reduction in film rental with earlier windows for home play, among other financial strategies (and with some benefitting from fewer theaters competing in some cases). But particularly AMC, the largest circuit, with its massive debt, along with Regal, the second largest, emerged from bankruptcy but still face challenges and need momentum to continue.
Studios have different parameters for gauging the year than theaters. Domestic box office is only one part of their theatrical presence, and theaters themselves only provide the largest but not sole section of the revenue studios take in from movies. Trying to assess their situation is tougher, since, unlike box office, those figures aren’t readily communicated. But we do know there is one significant negative issue for them, and one barely touched upon in box office coverage.
The non-U.S./Canada share of box office is a majority of what studios gross. Without it, they’d be out of business. And what happened last year stands as a huge problem.
At a time when domestic box office is stalled and way below pre-Covid levels, foreign has dropped more. We don’t yet have exact figures (foreign reporting takes longer to compete, and then culling domestic studios’ share of that adds another level of delayed clarity). But we have enough data to suggest the problem is major. At the extreme, “Twisters” only took in 28 percent of its gross from foreign theaters.
Of the top 20 grossing releases worldwide in 2024, 55 percent of the gross came outside the U.S./Canada. Why is that a problem? That is a collapse in interest internationally. Checking back, both 2019 (the last pre-Covid year) and then 2014, typical years, saw 66 percent of the total coming from foreign.
So not only is domestic dramatically lower, but the overall box office worldwide for top films has dropped even more. And that’s on top of the already built-in decrease in domestic gross.
That comes when one major problem for theaters is a reduced number of films coming from most studios. With the heavy reliance on foreign revenue, the combined drop, unless studios figure out how to make less expensive films, means that counting on a return to elevated production becomes less likely.
Releases in 2024 showed some dramatic trends. If those trends continue (and there is little sign they won’t), the dearth of original live-action films will also. Last year, around 60 percent of the domestic gross came from a combination of sequels, remakes, or animated films (some overlap there, with the four biggest animated releases all sequels).
That’s a historic high. Breaking it down, 27 percent of the gross (and with many kids’ tickets, a larger share of attendance) went to animated releases. How strange is that? Ten years ago, the animated share was 14 percent. In 2019, 12 percent. This has been a huge growth sector for the industry, at a level never before seen.
Sequels alone constituted 52 percent of the total. Add other franchise-related titles (films like “Twisters,” but not “Wicked”), and it comes to 57 percent. In 2014, the shares were 30 percent for sequels, 38 percent sequels and franchise-related films — 20 years ago, 23 and 27 percent, respectively.
The hole in the gross could be filled if that gap in original films decreased. Though franchises are the norm, at some point, current ones run out of steam, and at the very least, original titles are needed to create new ones.
Only three films had a domestic take over $100 million. Two were book adaptations (“It Ends with Us” and “The Wild Robot”). “IF” was the biggest original screenplay, but with a $110 million budget, its $190 million worldwide gross made it a marginal player. Studios want a better return from risks like that, particularly for foreign results.
At least four far lower-budget original titles, plus one micro-budget effort, suggest a way forward if somehow larger studios can figure out how to replicate them. “Nosferatu” (Focus), “Longlegs” (Neon), “Civil War” (A24), and “A Complete Unknown” (Searchlight) all are initial wide release (i.e., general audience appeal) films that will end up $68 million or more domestic, all on budgets far below the $100 million-$200 million cost of most franchise titles. “Longlegs” was less than $10 million. Then there’s “Terrifier 3” (Cineverse), $89 million worldwide, on a $2 million budget? That’s amazing.
Although their marketing costs varied, both “Longlegs” and “Terrifier 3” did this on shoestring budgets. It can be done. Focus and Searchlight are arms of Universal and Disney, respectively. Universal has shown in the past it can do well on lower-cost original films, but these remain a mystery for Disney (once again the #1 distributor, nearly all franchise titles, and most costly at $150 million or more).
It was little noticed, but “Terrifier 3” was a breakthrough in a way that will have impact, and perhaps loosen up greenlighting a little. It would have had an NC-17 rating, but Cineverse decided to go out unrated. In the past, that would have meant losing many top chain theaters.
They nearly all played it. Then the expectation was that “The Brutalist” would never pass R-rating muster. A24 fought an NC-17 expected for Brady Corbet’s Golden Globe Best Picture winner. (Only the studios who are members of the MPA, which gives the ratings, are required to have one.) It was last minute, but with no cuts, the film received an R. Had that been anticipated, it might have had studio backing initially. A24, like other independents, isn’t an MPA member. The major studios that are members won’t make or acquire films likely to be NC-17.
A final important but under-reported development in 2024 was the further shortening of when a movie lost theatrical exclusivity. Final figures for the year’s releases aren’t yet in, but they decreased again, both for VOD (digital rental or downloading) and streaming on platforms like Netflix, Disney+, and Max. PVOD, in particular, seems to have evolved into a major revenue source. It could be replacing a good part of the reduced theater revenue. If so, that’s good for theaters because it helps ensure ongoing production.
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