Dec 13, 2022 - Economy

All eyes on Avatar to save struggling box office

Films with the highest all-time worldwide box office grosses
Data: The Numbers; Chart: Axios Visuals

The highly anticipated Avatar sequel "The Way of Water" is expected to dominate this week's box office when it hits theaters on Friday, 13 years after the original James Cameron Avatar film first debuted in December 2009.

Why it matters: The new film "is under tremendous pressure to deliver the goods, reinvigorate late-year moviegoing, and give Cameron the de facto green light for the future planned installments of this mega-high profile movie brand," said Comscore senior media analyst Paul Dergarabedian.

  • Cameron has planned as many as three additional sequels, but he admitted that the franchise's success will be determined by the performance of "The Way of Water."

Details: The Disney movie is expected to bring in over $150 million+ domestically this weekend, per Dergarabedian, which would give it one of the best-performing weekend openers this year.

  • So far in 2022, only "Doctor Strange in the Multiverse of Madness" and "Black Panther: Wakanda Forever" — both Disney Marvel hits — have surpassed $150 million in their domestic box office debuts.
  • "This is exactly the kind of movie that demands to be seen in a theater with a communal experience," said Boxoffice Pro analyst Shawn Robbins.

Yes, but: The new Avatar film, which runs over three hours long, may not see late-night shows book up as quickly, Dergarabedian warned.

  • There's little competition heading into the holiday season. The third installation of Disney's "Ant-Man" doesn't debut until February.

Be smart: Unlike most Marvel films over the past two years, Avatar has had a Chinese debut date the same day it premiers domestically.

  • Not only is overseas viewership expected to soar due to availability in China, but it will also be a boon to high-margin Imax and 3D ticket sales.
  • The first "Avatar" grossed more than $200 million in China and counting, per Box Office Mojo. The film was recently brought back in Chinese theaters ahead of the sequel's release.

Flashback: The original "Avatar" briefly ushered in a wave of 3D moviegoing when it premiered in 2009, though 3D failed to catch on due to the poor quality of other films that added the capability after they were already completed.

  • That film brought in $264 million in Imax ticket sales, including $6 million during its rerelease in September this year. It is the only film to cross $250 million in Imax history.
  • "We talk a lot about whether [the sequel] is going to kick off a new movement in 3D," IMAX CEO Rich Gelfond told Axios last month.

Between the lines: To date, Avatar is the highest-grossing film in history worldwide, but its $77 million domestic opening weekend in 2009 didn't suggest at first that it would go on to be successful.

  • "Cameron's films have always been marathon runners, not sprinters, so it's the final gross that will be key," Dergarabedian said.
  • Still, the second "Avatar" installation is expected to be Cameron's first-ever film to cross $100 million in its domestic weekend debut this weekend.

The big picture: The box office struggled to fully recover from the pandemic this year — even sending the second-largest operator into bankruptcy in September — but analysts are hopeful it will improve next year and beyond.

  • Robbins told Axios he expects sales to improve with a more consistent release schedule and more family-friendly content with theatrical appeal.
  • The box office is currently down 34.4% from this time in 2019. It's expected to end the year with roughly $7.6 billion in domestic ticket sales, which would be around 32% less than the $11.3 billion it ended with in 2019.

The bottom line: "No matter how you slice it, this is an incredibly important movie for theater owners around the globe and after a very slow post-summer season and "Wakanda Forever" dominating the box office for five weeks," Dergarabedian said.

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