The film industry is undergoing a significant transformation marked by shrinking revenues, decreasing output, and changing consumer preferences.
Major studios are consolidating, streaming platforms are struggling to prioritize original films, and television is emerging as a dominant medium. This shift has profound implications for the business and audiences alike.
The Shrinking Presence of Major Studios
From 1995 to 2009, Hollywood’s six major studios—Disney, Warner Bros., Universal, Paramount, 20th Century Fox, and Sony—released an average of 112 theatrical films per year. However, from 2010 to 2023, that number dropped to 83, with the disappearance of Fox under Disney exacerbating the decline.
The number of theatrical tickets sold in the U.S. has fallen by 38% over the past decade, while ticket prices have increased by 33%. This trend points to fewer high-quality films produced by the remaining studios, resulting in a reduced selection for consumers.
Between 2017 and 2019, the worldwide box office consistently hovered around $40 billion annually. However, in 2022 and 2023, it only reached about half that amount, and 2024 is lagging even further behind those already dreary figures.
The Struggles of Theaters Deepens
The exhibition business faces significant risks. Theaters are grappling with over-leveraging and an oversupply of screens. The U.S. alone has around 40,000 screens, yet there is a shortage of consistent, high-quality content to fill them.
Major theater chains like AMC and Regal have faced significant financial challenges, with Regal’s parent company, Cineworld, recently emerging from bankruptcy. AMC, the world’s largest theater company, is struggling with a heavy debt load and has seen its stock price drop by over 90% in the last year. Also, long-time independent film champion Alamo Drafthouse has reportedly considered a sale.
Even before the lockdowns and mandates, theater attendance declined due to changing consumer habits and competition from other entertainment options. The industry’s over-reliance on IMAX studio action tent poles highlights the need for a diverse film slate for theater chains to thrive. This precarious situation makes theater closures and downsizing very likely in 2024.
The Limited Impact of Streaming
Streaming services have not fully compensated for the decline in theatrical releases. While 77% of film libraries worldwide on subscription video-on-demand (SVOD) services consist of theatrical films, original films from major streamers like Netflix account for only a quarter of total film catalog demand.
Netflix, which has historically been a prolific buyer of original content, is significantly reducing its annual output of original English films. This shift suggests that streaming platforms are not prioritizing original films as much as initially anticipated.
Discover What Global Streaming Platforms Pay to License Films and Shows
Unlock unparalleled access to detailed market intelligence drawn from financial data and agreements between leading industry players, including distributors, producers, and streaming platforms.
Take the guesswork out of licensing negotiations and discover the rates and terms that define the global film and television distribution market.
Uncover the real numbers behind global film and TV content deals across multiple territories and availability windows to optimize your distribution strategies.
Whether you’re an independent producer or executive, our single-user PDF downloads provide flexible, actionable intelligence tailored to your business goals.
Licensing Terms & Included Programs:
Access comprehensive SVOD Rate Cards for licensing motion pictures and series across multiple territories and availability windows. With data spanning the last decade, our reports provide invaluable intelligence on:
- Motion Pictures: Pay-1, First Run, Second Window Features, Recent Library Features (Tiers AAA,A,B,C), Library Features (Tiers AAA,A,B,C), Current and Premium Made-For-TV Films and Direct-To-Video Films, covering many license periods over the last decade
- Episodic TV: Current, Premium, Premium Catalog (1HR & 1/2HR), Catalog Series (1HR & 1/2HR), and Catalog Miniseries + Case Studies on Current Mega Hit, Catalog Mega Hit, and Premium Catalog, covering multiple licensing periods
Gain a competitive edge by understanding the real-world distribution rates and terms driving global licensing deals. By leveraging most-favored-nation rates, our data reflects a diverse range of content and distributors, ensuring relevance across multiple availability windows and content tiers.
Studio System Scorecard: 2023 and Beyond
Box Office Highlights, Revenue and Profit Declines, and Outlook
NBCUniversal: Revenue: $11.6B -6% / Profit: $1.3B +35%
- Led by “The Super Mario Bros. Movie” ($1.36 billion), “Oppenheimer” ($958 million), and “Fast X” ($705 million).
- Total global box office revenue reached $4.91 billion, a 26% increase from 2022.
- Content licensing revenue dropped 12% to $8.2 billion due to delayed content availability and impact of industry strikes.
- Expenses declined over 8%, with programming and production costs down by 9%.
- Celebrated both Oppenheimer’s Oscar win and topping the worldwide box office.
- Strong talent relationships with industry leaders like Christopher Nolan and Jason Blum.
Warner Bros. Discovery (WBD): Revenue: $12.2B -12% / Profit: $2.2B -19%
- “Barbie” led with $1.44 billion, contributing to a $3.94 billion total global theatrical revenue, a 61% increase from 2022.
- Profitable films included “The Nun II” and “Wonka,” while DC blockbusters underperformed.
- Overall revenue dropped over 10%, primarily due to lower TV revenues impacted by strikes and fewer series sold.
- Earnings fell nearly 20% due to lower revenue and higher marketing expenses.
- Positive projections for 2024 with expected revenue growth of 1% profit growth of 3.3%.
- Focus on recovering TV production, licensing library content, and improving film slate.
Paramount Global: Revenue: $3.0B -19% / Profit: -$119M -144%
- “Mission: Impossible — Dead Reckoning Part One” led with $567 million.
- Total global box office revenue was $2.09 billion.
- Theatrical revenue decreased by 34%, licensing and other revenue dropped by 14%.
- Filmed entertainment revenue fell 20%, leading to a $119 million loss.
- Emphasizing more efficient content production and improving ROI by balancing high-budget and modest-cost titles.
- Projected revenue growth of 5% in 2024 with a return to slight profit.
Retention Over Acquisition: How UK and US Streamers Adapt to Market Saturation
As global streaming markets mature, platforms are shifting focus from acquisition to retention amid near-saturation in regions like the U.S. Strategies include ad-supported tiers and content diversification. While platforms strive to meet changing demands, competition is intensifying, particularly in the ad-supported landscape, emphasizing the need for innovation and strategic partnerships for sustained growth.
Continue Reading […] Retention Over Acquisition: How UK and US Streamers Adapt to Market Saturation
Sony Pictures: Revenue: $10.3B +2% / Profit: $719M -18%
- “Spider-Man: Across the Spider-Verse” grossed $691 million.
- Other successes included “The Equalizer 3” and “A Man Called Otto.”
- Film revenue fell 12%, with drops in theatrical, home entertainment, TV, and streaming.
- Despite revenue gains in TV productions and media networks, overall profit declined 18%.
- Strikes caused delays in film releases and TV show deliveries, impacting profits.
Disney: Revenue: $7.8B -8% / Profit: -$666M -3,230%
- Top films included “Guardians of the Galaxy Vol. 3” ($846 million), “The Little Mermaid” ($570 million), and “Elemental” ($496 million).
- Total box office revenue over $4.8 billion, slightly down from 2022.
- Content sales and licensing revenue dropped 8%, with significant losses.
- Weaker theatrical performance compared to previous years.
- Focus on improving creativity and quality over volume.
- Anticipated 2024 releases include big franchises like “Inside Out 2,” and “Deadpool 3.”
FilmTake Away: Challenges and Future Outlook
The film industry is contracting, with fewer major players releasing fewer titles for a shrinking revenue pie. This decline is bad news for the creative community, which will see reduced financial flows.
While theatrical exhibition will continue to exist, its role as the centerpiece of Hollywood is being questioned. The talent migration to television and other formats may become more pronounced as the industry navigates these changes. Despite the challenges, the future of cinema will depend on its ability to adapt and innovate in an increasingly competitive entertainment landscape.
The future of the global box office remains uncertain, with doubts about whether it will return to the $40 billion-plus levels of 2019 and earlier. A clearer picture is expected by 2025, once the impacts of the writers’ and actors’ strikes have subsided.