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Cinemark CEO Sean Gamble sees the number of Hollywood tentpoles at the multiplex catching up to 2019 levels so domestic box office can potentially surpass pre-pandemic highs.
“We see content recovering to levels consistent with pre-pandemic levels, if not a touch higher as we look forward. It’s really a question of how long it takes that trajectory to get there,” Gamble told the J.P. Morgan Global Technology, Media and Communications Conference during a session that was webcast.
The Cinemark boss said a greater number of theatrical releases has fed greater interest by consumers to return to cinemas going into the usual late summer dip in Hollywood box office.
That box office recovery extends beyond the usual tentpoles like Avatar: The Way of Water and Ant-Man and the Wasp: Quantumania helping fill seats and sell popcorn at the multiplex to low- and mid-budget adult dramas like 80 For Brady and A Man Called Otto, or horror pics like M3GAN giving confidence to the major studios to release movies in theaters before they inevitably land on streaming platforms.
“We’re seeing when compelling films of good quality come to our theaters, they’re working and it doesn’t matter whether they’re large films or small films,” Gamble argued. Better box office performance is also sustaining a growing commitment by Cinemark’s traditional studio partners for theatrical releases ahead of streaming platform play.
“If the current data holds, that’s just going to be more and more encouraging for them to put more of these films out theatrically, because it’s going to serve that promotional and financial value that they’re seeking,” Gamble said of the return of the theatrical window as a revenue driver for major studios.
And streamers are also joining the pivot to movie theaters, as Apple and Amazon especially lean into theatrical releases of their biggest titles before streaming online. “You look at Apple’s upcoming releases with Killers of the Flower Moon and Napoleon. These are big epic scale films,” Gamble said.
As Cinemark like other major exhibitors look to continue recovering from the pandemic with metrics like cinema box office and food and beverage sales, Gamble discussed whether recent success in increasing ticket prices and concession stand sales amid inflationary pressures in the U.S. economy could be sustained.
“When we think about pricing opportunities for us, it’s really more about sophistication as it pertains to honing demand and elasticity curves,” Gamble said, explaining pricing was about increasing revenue where possible, but increasing value for consumers to ensure they keep returning to the multiplex and not staying away due to excessive costs.
Of course, stimulating increased theater attendance has been held back by inflationary pressures in the wider economy. “We’ve been very careful with our pricing both for tickets as well as for food and beverage,” he said, having also introduced discount pricing coming out of the pandemic.
Asked about the ongoing Writers Guild of America strike, Gamble said Cinemark hoped for a quick resolution of the dispute to ensure a constant supply of Hollywood movies into the local multiplex down the road, even as the threat of peer entertainment unions launching their own labor action for leverage at the bargaining table looms.
“We don’t anticipate much of an impact on a majority of titles for this year and next, but it’s ultimately going to boil down to how long this progresses and then if anything does kick in with any of these other guilds,” he said.
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