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August 22, 2022

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Good morning, Media Deals readers!

­čŹ┐ Situational awareness: MoviePass will relaunch in beta on Labor Day with three pricing tiers, Insider reports. The company said it has partnerships with 25% of U.S. theaters.

1 big thing: Movie theaters' end of summer blues

Data: Box Office Mojo; Chart: Simran Parwani/Axios

The summer box office rebound has stalled out, and it's once again forcing movie theaters into some difficult choices, Tim writes.

Why it matters: This is a precarious ledge for the entertainment industry to stand on. After Wall Street soured on streaming, studios were banking on movie theaters' revival.

The big picture: After a summer that included hits like "Top Gun: Maverick" and "Doctor Strange in the Multiverse of Madness," theaters are facing the same challenge they did during the early days of the pandemic: not enough movies.

  • Movies are still getting delayed as COVID precautions are making films more expensive and a bottlenecked VFX industry is leading to longer production times.
  • The DC film "Black Adam" was pushed from its late summer release date to October, while the next "Mission: Impossible" movie was supposed to debut in September before getting moved to next summer.

By the numbers: Since "Thor: Love and Thunder" opened in early July to $144 million, there hasn't been a single film to have even a $50 million weekend. The next few weeks do not see a lot of new product, either.

  • So far, U.S. theaters have made $5.1 billion in ticket sales. While that is up a ton over the last two pandemic-affected years, it's still pacing 30% behind 2019.
  • There have been 310 movies released this year through Sunday. Even if it were to double that from now until the end of the year, it would still be well behind the 910 films that were released in theaters in 2019.

Be smart: The lack of new movies is due in part to studios releasing more movies directly to streaming, a strategy that has had uneven results.

  • Movie theater companies Cineworld and AMC are diverging in results (Cineworld is filing for Chapter 11, while AMC is diversifying and still a meme stock), but they're grappling with the same box office demand issue.

What's next: It will get better toward the end of the year, when films like "Black Panther: Wakanda Forever" and James Cameron's "Avatar" sequel hit theaters.

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