There is no movie coming out over the next two-plus months that is tracking to debut north of $40 million at the domestic box office in its opening weekend. Studios have never released many huge movies in August or September, but the slate between now and October is light even by those standards.
(Three movies posted a $40 million weekend during that same stretch in 2019 — “The Lion King” in weekend two, a “Fast and Furious” spinoff and a sequel to “It.”)
It wasn’t supposed to be this way. “Black Adam,” a DC movie starring Dwayne Johnson, was supposed to open next weekend.
But Hollywood, like the rest of the economy, is suffering from a supply-chain problem. Production halted for months due to the pandemic, and was both slower and more costly when it resumed.
Even when production finished, the visual-effects industry was often unable to handle all the product. There has been a full meltdown in the sector, according to executives at several studios. Visual-effects houses expected business to slow down during the pandemic. While that happened for a beat, the amount of work they had to do increased as soon as studios figured out the proper protocols.
VFX houses weren’t equipped to handle it all. Many had transitioned to remote work, which made them less efficient. They lost talented staffers to the great resignation and poaching from companies like Meta.
We saw a similar pandemic hangover effect in the music industry. The slate of new releases in the first half of the year was light (at least until May), which is why five of the 10 best-selling albums of the year came out in 2021.
This is the last thing movie theaters need. These theaters are suffering under large debt loads accrued during the pandemic. One European chain has already surrendered to its lenders. AMC, the world’s largest chain, was riding high after a bunch of retail investors turned it into a meme stock. But its shares were down more than 40% this year through midday Friday and almost 80% from their peak in June 2021.
The success of a few blockbusters has masked the softness of the middle. Just 10 movies this year account for 65% of all grosses in the US. “Top Gun: Maverick” accounts for almost 14% of the market on its own. Before the pandemic, the top 10 movies accounted for less than 40% of grosses, according to Comscore.
Theaters are quick to blame streaming as well. They are short on product because studios have released some titles directly to their own streaming services. Even before the pandemic, major studios had pared back their slates to huge blockbusters and low-budget movies. Mid-budget dramas and action movies were a dying species. Those have been reborn as streaming movies.
Yet streaming services could also help theaters, if they were so inclined. Apple Inc. plans to release at least a couple of movies exclusively in theaters for a real window (think 30 to 45 days at a minimum). Amazon.com Inc. just bought MGM, which has released movies in theaters. TBD on if that continues.
The big question mark here is Netflix Inc., which is still debating what to do about theaters. It does release movies in theaters, but only for a few weeks (and not in most major chains). Its latest attempt at a blockbuster, “The Gray Man,” a $200 million spy thriller starring Ryan Gosling and Chris Evans, has made less money than “Paws of Fury: The Legend of Hank” over the last week.
The good news, at least according to most movie studios, is that the lack of product is temporary. The success of “Top Gun: Maverick,” the new “Minions” and “Doctor Strange” has convinced most media chieftains that the theatrical business is viable again, at least for certain titles. And the slowing growth at Netflix has also reinforced the importance of having multiple revenue streams.
The studios swear that next year things will be back to some semblance of normal. They will be releasing blockbusters almost every weekend. A quick look at the schedule for next summer confirms as much. Then again, they said that about this summer too.
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