Box-Office Slump: Hollywood Facing Worst Summer in Eight Years
Domestic box office is down 20 percent in the U.S. as "Sex Tape" goes limp and, for the first time since 2001, no film crosses $300 million. Laments one studio executive, “I wish I worked at Netflix.”
A version of this story first appeared in the Aug. 1 issue of The Hollywood Reporter magazine.
Less than six weeks before Labor Day, hopes for recovery at the North American summer box office have evaporated. The season is expected to finish down 15 to 20 percent compared with 2013, the worst year-over-year decline in three decades, and revenue will struggle to crack $4 billion, which hasn't happened in eight years. As a result, analysts predict that the full year is facing a deficit of 4 to 5 percent.
Comparisons in North America are tough, considering revenue hit a record $4.75 billion in summer 2013. It didn't help that Fast & Furious 7 was pushed from July to April 2015 following the death of Paul Walker or that Captain America: The Winter Soldier opened in early April. But even bullish observers are grim. "Moviegoing begets moviegoing, and we have lost our momentum," says Rentrak's Paul Dergarabedian. "People aren't seeing trailers and marketing materials. They still want to go to the movies -- they just want to go to really good movies."
Although there have been no Lone Ranger-size debacles, for the first time since 2001 no summer pic will cross $300 million domestically (X-Men: Days of Future Past, Maleficent and Transformers: Age of Extinction hover near $230 million). May kicked off with The Amazing Spider-Man 2 earning $200 million less domestically than 2013's Iron Man 3; by July 20, the divide had swelled to nearly $690 million as revenue topped out at $2.71 billion, down 20 percent compared with the same period last year.
International returns remain strong, making up for some of the damage, but in certain cases they aren't enough. Spider-Man 2 topped out at $706.2 million globally, notably behind the $757.9 million earned by The Amazing Spider-Man in 2012. "I would have liked Amazing Spider-Man 2 to make a lot more money for us than it did, but it made a lot of money for us anyway," Sony co-chairman Amy Pascal said in a recent interview with The Hollywood Reporter.
X-Men is the only tentpole that has earned more than its predecessor domestically (X-Men: First Class grossed $146.4 million in 2011), contributing to Fox's best summer in years (it is No. 1 in market share). But Paramount's Age of Extinction has grossed far less than previous Transformers movies domestically, though it will be the first 2014 film to hit $1 billion worldwide thanks to $300 million in China. "Young men haven't been as enthusiastic as usual," says analyst Phil Contrino. "Maybe [studios] shouldn't just go after this demo when building their summer tentpoles." Female-fueled properties, including Maleficent and The Fault in Our Stars, have produced some of the summer's biggest success stories.
Also contributing to the malaise is a lack of family product (including no Pixar movie), the allure of TV and myriad ways consumers can view entertainment in their homes. (Laments one studio executive, "I wish I worked at Netflix.")
Filmmaker Jon Favreau agrees that the popularity of television and new technologies are altering viewing habits. "I think times are changing. We have to acknowledge that and not try to chase what used to be," says Favreau, who is currently prepping Jungle Book for Disney. At the same time, he said there will continue to be a worldwide appetite for big spectacle movies based on known brands.
But the Iron Man director is in theaters this summer not with a studio tentpole but with indie hit Chef, which has grossed north of $26 million to date, a coup for Favreau and independent distributor Open Road Films. With Chef, Favreau didn't have to worry about making a film that needed to have the widest possible appeal. "It didn't need to capture every person in every country," he says.
Many medium-size studio movies have underperformed this summer, including Seth MacFarlane's A Million Ways to Die in the West and Sony's Cameron Diaz comedy Sex Tape, which opened July 18 to a meager $14.6 million.
For the summer to hit $4 billion and finish down only 15 percent, revenue needs to match last year's through August. That puts pressure on Dwayne Johnson's Hercules (July 25), Scarlett Johansson's Lucy (July 25), Marvel's Guardians of the Galaxy (Aug. 1) and Paramount's Teenage Mutant Ninja Turtles (Aug. 8). But it's a tall order, considering last summer ended with a bang. "I don't know if we have a major sleeper left this year, other than Guardians," says Dergarabedian.
Still, many believe summer 2015 will restore order with a lineup that includes Avengers: Age of Ultron, Minions and Jurassic World. "I think it's cyclical," says X-Men producer Simon Kinberg. "Next summer will be the biggest box-office summer in history, and nobody will be worrying about the business."
Tatiana Siegel contributed to this report.