How hard has the COVID-19 crisis hit theater ticket sales this year? Since 2015, total box office revenue has been above $11 billion each year and peaked in 2018 at $11.9 billion. This year, with the first eight of the year’s 12 months almost over, ticket sales stand at $1.8 billion, a sign of just how serious the carnage has been for the industry. At the current rate of ticket sales, the 2020 total will be well under $3 billion. Easing of restrictions for theater attendance could push that up, but not enough to reach even half the of the recent $11 billion annual standard.
Other measures show the extent of the trouble. According to Box Office Mojo, there have been 311 movies released this year. In both 2018 and 2019, the figure was over 900. Clearly, a number of the movies slated to be released in the first half of the year will be released this year or early next. By another measure, average gross ticket sales per film released have been $5.8 million this year. The number has averaged over $13 million each year for a decade.
Last weekend, ticket sales reached almost $6.4 million, a sharp improvement over a long number of weeks when the figure was under $2 million, and in some cases less than $1 million. Russell Crowe’s new movie “Unhinged” posted ticket sales of $5 million, which made it the most successful of the weekend by far. The primary reason for the increase was that AMC Entertainment Holdings Inc. (NYSE: AMC), the largest theater chain in the United States, opened some of its locations. Social distancing kept seating capacity in these well under normal levels. The chain charged as little as $0.15 a ticket. When tickets are raised to their normal price of over $10, attendance faces another hurdle.
The effects on companies that have major studios also will last the whole year, with some improvement between now and year-end. Walt Disney Co.’s (NYSE: DIS) “studio entertainment” division posted revenue of $1.7 billion for the quarter than ended June 27. The number in the same period a year ago was $3.8 billion.
The extremely low sales already may have triggered the most radical change in the business since movies moved from black and white to color, which started in the late 1930s. Streaming movies to the home or to portable devices is the most disruptive force in decades. It has sharply accelerated recently. Among the most visible signs of this is that the streaming industry leader, Netflix Inc. (NASDAQ: NFLX), posted a total of 193 million subscribers at the end of the second quarter. The figure in the year-ago period was 151 million. Major competitors, which ironically include the Disney+ service, have done equally well, if not better.
The pandemic may not have killed the traditional movie industry, but it has wounded it beyond repair.