US box office settles into a new normal with decreased and unpredictable box office attendance.

Wuhan Reopens Cinemas After Months In Lockdown

WUHAN, CHINA – JULY 20: (CHINA OUT) Residents watch a movie in a cinema in Wuhan on July 20, 2020, in Wuhan, Hubei Province, China. Taking various measures against COVID-19, cinemas in the city reopened in an orderly manner on Monday. The China Film Administration, in a circular last week, allowed cinemas in low-risk areas to resume operation with effective epidemic prevention measures in place. (Photo by Getty Images)

By Jade Lopez, CRDN
Tuesday, August 27, 2024

Over the past four years, the US box office has experienced a significant decrease in attendance and ticket sales, adjusting to what could be considered a “new normal” for the entertainment industry.

Struggling with growth before the Global Pandemic hit, movie theaters and cinemas were severely impacted through the pandemic with millions of locations shutting down to adhere to nationwide guidelines. Box offices took multibillion-dollar losses, with streaming services rising in popularity. Nearly five years later, sales have never fully recovered. With roughly 20% decreased attendance compared to 2019, platforms such as Netflix, Hulu, and HBO Max have flourished, offering a convenient, accessible, and flexible experience from the comfort of your home.

Since the official close of pandemic mandates movie theaters and cinemas have seen some significant rebounds, and streaming services have taken a hit to their revenue from the highwater marks the latter enjoyed at the height of pandemic mandates. However, those rebounds have been incongruent amongst the various box office players. Movie theaters and cinema, who generate a significant amount of their revenue from concessions, have enjoyed substantially better rebounds with inflationary costs, than has been the case for movie studios, who for a time, continued to produce big budget movies at pre-pandemic quarter of a billion-dollar budgets, only to struggle to break even rather than make a profit more often than not. once certain to make a profit of nearly a billion dollars or more, movie studios released big budget franchise movie brands such as Mission Impossible: Dead Reckoning Part I, or Indiana Jones and the Dial of Destiny, only to break even, or fail to break even.

This has led to a number of cascading events. Unable to accurately estimate success in movie theaters and cinemas, movie studios have substantially reduced production budgets in many more instances. The post-pandemic-mandate reality is that a highly successful movie today, makes at least $70 million in its opening weekend. Prior to the pandemic that number was approximately $200 million in a movie’s opening weekend. Furthermore, this post-pandemic-mandate reality has conclusively undermined the movie theaters and cinemas claims that day-and-date movie releases (movies released in theaters and on a streaming platform simultaneously) are dead. The problem with being unable to estimate a movie’s success more accurately upon release, is indirectly a problem of movie theaters and cinemas, such that it is more concerned with the streaming industries day-and-date releases than it is on studios’ ability to make profits above their production budgets.

This apparent conflict has substantially marginalized movie theaters and cinemas’ advocacy for extended windows between theatrical releases and streaming platform releases. Initially, movie theaters and cinemas advocates were much more successful in getting longer windows between theatrical releases and streaming platform releases. However, as the pendulum has swung against movie studios’ profit-making abilities amid quarter of billion dollar budgets, the windows between theatrical releases and streaming platform releases have dwindled down to 30 days or less in many instances, and in some instances has resulted in day-and-date releases such Universal Studios, day-and-date release of Five Nights at Freddy’s, which was produced on a $20 million budget, and with an $80 million opening weekend, was considered to be wildly successful, both in theaters and on streaming.

The cost of a movie ticket is superseding current inflation rates at an astounding rate, and with the time and commitment it takes to drive yourself to the theater, find a parking spot, wait in line at concessions, have your ticket checked at the gate, finding your exact room, waiting through movie premieres, and making your journey back down out of the theater and through the parking lot with tens of other movie-goers is a lengthy commitment in itself. By the time it takes to complete this half-day event, you could have easily finished two movies on your couch in your own living room. That reflects what is called “options.” Today, there are many more options than there were prior to the pandemic, and those options will only grow.

However, with high-grossing movies such as Barbie, the sixteenth highest-grossing film ever made, there may be some hope for the future of box offices. Upcoming releases for the 2025 year include Captain America: Brave New World, Snow White, Jurassic World 4, Mission Impossible 8, Wicked: Part 2, and Zootopia 2. The hope that the upcoming box office sales will surpass 2023’s 9.05-billion-dollar revenue in tickets alone is one that the future of movie theaters can wish for.

While the pandemic has reshaped how consumers now prefer their movies, it also opens a portal for new strategies to keep viewer engagement up in creative ways, whether through upgrading the moviegoing experience with options like offering full-course meals and luxury seating, hybrid release models, or community-centric programming. By embracing these changes and unlocking a new appreciation for the “new normal” cinematic experience, box offices can hope to emerge in a more resilient, persevering way. While the future of the box office is uncertain, the commitment to continuous enhancements and adaptability will play a vital role in upping audience attendance.