
Does Box Office Success Bode Well for the Future?
By Movieguide® Contributor
A new report from PwC predicted that the global box office would not top pre-pandemic levels until 2026 as the industry continues to struggle with consumer habits set during the pandemic.
This report placed a sobering reality on the theater business which has begun to find some hope this summer after strong showings from INSIDE OUT 2 and DESPICABLE ME 4 which recently helped carry the domestic gross for the year over $4 billion. Though more than $1 billion has been collected over the past month thanks to these giants, the industry is still set to drop its revenue to roughly $8 billion for the year after collecting $9 billion in 2023.
This year’s struggle is largely caused by the dual strikes last summer which led to a very sparse release schedule for the first half of 2024. The industry, however, would have struggled regardless as theaters strive to win back the audience lost during the pandemic. This battle has been harder than previously thought. At the start of the year, experts predicted the industry would top pre-pandemic levels in 2025, but this new PwC report pushes the estimate to 2026.
While this estimate reveals an industry that is slowly recovering, it also uncovers the reality of — at that point — seven years of inflation. Thus, the $40.23 billion worldwide gross predicted for 2026 — compared to 2019’s $38.55 billion — does not tell the whole picture.
“Admissions are not expected to return to pre-pandemic levels throughout the forecasted period. By 2028, the last year of our projections, admissions are projected to fall short by 1.5 billion compared to pre-pandemic levels,” Bart Speigel, global entertainment and media deals leader at PwC, told The Hollywood Reporter.
As the theater industry continues to struggle, the report also paints a picture of a cooling market across the entertainment industry as the streaming industry continues its quest to improve profitability and reduce consumer churn.
The report, however, provides an encouraging future for consumers as it suggests that streamers will look to strategies other than raising prices to improve their business. PwC predicts this will lead to more licensing and more bundles and increase the odds of industry consolidation.
The report also noted that gaming continues to be the largest growth area in the industry, with the sector expected to gross $300 billion by 2027, almost double where it was in 2019.
Movieguide® previously reported:
Recovery from last year’s WGA and SAG-AFTRA strikes may take longer than originally anticipated, analysts predict.
“[W]e were willing to shift our valuation buildups to 2025 to capture the projected industry recovery path after an expected hiccup in 2024,” B. Riley analyst Eric Wold wrote. “We are now reversing course and admitting that we may have been too optimistic and would probably be proven wrong with that view.”
“Full-year 2024 box office revenue, which Wold pegged at $8.61 billion last November, could now end up as low as $8 billion to $8.4 billion before rebounding to $9.92 billion in 2025,” per Deadline.
Due to the dual strikes, fewer movies are slated for this year than the previous year, with 107 movies set for wide theatrical releases versus 124 released last year, another Deadline article reports.
Studios are sharing their concern for this year as well. One executive said, “There’s no way that a labor stoppage as prolonged as chaotic as this wasn’t going to have consequences. Fire comes through and burns a forest and a town, and then the fire is over. But the consequences of the fire aren’t over: There’s mudslides, and there’s damaged infrastructure.”
Wold believes even with the aftermath of the strikes, moviegoers will determine the demand for future products in the long run.