What This Rising Metric Means for a Struggling Box Office
By Movieguide® Contributor
Even as the box office struggles in the post-pandemic era, one key metric has grown in the past five years, pointing to a part of the industry that is doing better than ever.
The key area that has grown in recent years relates to how successful a movie is following its initial release: the multiple.
The multiple essentially measures the relationship between a movie’s opening weekend and the revenue it brings in for the rest of its theatrical run. For example, if a movie were to make $100 million in its opening weekend and it exited theater with a $300 million gross, its multiple would be 3.
A decade ago, the yearly average multiple was 2.84. This number has slowly grown and currently sits at 3.37 for 2024. While many would think shorter theater runs — which have come about due to how quickly theatrical releases become available for home viewing — would lead to a smaller multiple, the opposite has shown to be true.
This change is likely explained by a shift in audience preference. Fewer people appear to be willing to take a chance on a movie that has yet to prove itself worthy of the theater price tag, and thus, fewer people attend a movie’s opening weekend. However, word of mouth is a powerful tool, and more people are inclined to see the movie if general audiences rave about it.
Nonetheless, the box office continues to struggle in the era of streaming as it appears to have irrecoverably lost a significant audience. Even though the box office is predicted to finally eclipse its 2019 revenue number by 2026, this recovery is largely attributed to the rising price of tickets. Ticket sales for that year are expected to fall short of 2019’s by 1.5 billion, with no prediction for when this metric will compete with pre-pandemic levels.
The future of the theater industry is not all bad, however, as Imax, for example, has a strong outlook on both its short- and long-term future.
Movieguide® previously reported:
Wall Street Analysts agree with IMAX’s CEO that the company is well-positioned to move on from the pandemic and dual strikes and storm back with a strong near-term future.
“IMAX has emerged strong following the end of industry strikes and the pandemic, with the second quarter of 2024 marking a turning point characterized by significant growth in system sales and installations,” wrote Benchmark analyst Mike Hickey, per Market Watch. “IMAX raised its full-year 2024 instillation guidance to 130-150 systems, up from 128 in the previous year.”
Despite a down year for the theaters, with the expected to end the year at an $8 billion gross (compared to $9 billion last year), IMAX serves as one of the only bright spots in the industry.
CEO Rich Gelfond has been touting the company’s success, even back at the start of the year, when there was less data to support his positive claims. The first half of the year, however, has proven him right, and the near future appears even brighter.
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