From 'Iron Man 3' to 'Hangover III': The Profit Breakdown of May's Blockbusters
With worldwide marketing now costing as much as $175 million per film (gulp), THR sources reveal how box office, home entertainment and TV will contribute to each studio's bottom line.
This story first appeared in the June 14 issue of The Hollywood Reporter magazine.
After a rocky winter and spring, the North American box office boomed in May, with revenue reaching $1.14 billion to surpass the record $1.04 billion earned in 2011. Heading into the month, revenue for the year was down a troubling 12 percent over 2012. Now, the gap is 7 percent.
The bonanza was led by global blockbusters Iron Man 3 and Fast & Furious 6. But they weren't the only profit-generators. Star Trek Into Darkness has held in especially well, while The Great Gatsby exceeded expectations. Even The Hangover Part III will make money.
All of this is great news for Hollywood, considering the staggering amount of money it takes to make and market a summer tentpole. Numerous studio insiders tell THR that marketing a film worldwide can now cost $175 million.
Below is a glimpse at the financial health of the May tentpoles.
Iron Man 3 (Disney/Marvel Studios)
Budget/marketing: $375 million
Projected global gross: $1.2 billion
Revenue analysis: May's biggest grosser is on track to generate profits upward of $400 million for Marvel and Disney, even after gross participants -- including Robert Downey Jr. -- take their fees, along with the $90 million or so owed Paramount because of its previous distribution deal with Marvel.
The Great Gatsby (Warners Bros./Village Roadshow Pictures)
Budget/marketing: $280 million
Projected global gross: $345 million
Revenue analysis: Thanks to generous Australian tax incentives, the budget for Baz Luhrmann's 3D epic was a modest $105 million. With a surprisingly decent domestic haul ($129 million to date) and predictably good global business, Gatsby should result in profits in the $25 million range.
Star Trek Into Darkness (Paramount/Skydance Productions)
Budget/marketing: $365 million
Projected global gross: $490 million
Revenue analysis: J.J. Abrams' sequel is on track to exceed the $385.7 million earned by his 2009 Star Trek. Fueled by a better showing internationally (Paramount expects overseas box office to hit $260 million), it won't earn as much domestically as that film, but profits should reach $75 million.
Fast & Furious 6 (Universal)
Budget/marketing: $335 million
Projected global gross: $730 million
Revenue analysis: The sixth installment is a blockbuster domestically and abroad. It should turn in a franchise-best performance (Fast Five did $626.1 million in 2011) and reap profits of $200 million or more for Universal and Elliott Management after gross players Vin Diesel and Dwayne Johnson are paid.
Hangover Part III (Warner Bros./Legendary Pictures)
Budget/marketing: $253 million
Projected global gross: $375 million
Revenue analysis: The final Hangover won't reach the level of the sequel ($586.8 million), but it is performing well overseas and has a lower budget than its May rivals, so it still should generate profits of $25 million or more after director Todd Phillips and other gross participants are paid their fees.