Movie theaters had a good run the past few months, but analysts don’t think that it can last.
Key details
Ticket sales were solid and above what they were the last two years, but lagged behind 2019 numbers.
Mega hits brought in billions for theaters worldwide. Top Gun: Maverick generated $1.5 billion in sales, while the Doctor Strange sequel collected $955.2 million.
“Let the good times roll,” said AMC Entertainment CEO Adam Aron during an earnings call last month.
Although this summer was good, companies only sold 17% of the available seats in the United States, according to entertainment research firm EntTelligence.
Despite nearly 50% fewer films being released this summer, the domestic box office still had $3.34 billion in ticket sales, down just 21% from 2019.
Why it’s news
Movie theaters were hit hard by the pandemic. People did not want to be in close proximity to strangers and the seats in the theaters made it more difficult to social distance. During that time people watched movies primarily on streaming services, sending theater sales way down.
Many analysts say movie theaters need to make big changes if they want to stay afloat. Many say big theater companies need to shut down their underperforming theaters.
There are 40,700 screens in the United States and Canada. Some theater executives concede that there should be no more than 35,000.
About 500 screens have closed since the pandemic began, according to the National Association of Theater Owners, a trade organization. More closures are expected soon.
Inflation has been another key factor affecting theaters. Most theaters have been forced to raise prices more recently as inflation continues. Many consumers think movie tickets are already pricey, so the price jump could dampen sales. This summer, the average ticket cost $12, up from $11.16 last year, according to EntTelligence.
Surprising statistics
Before the pandemic ticket sales were higher. In 2018, more than 1.22 billion movie tickets were sold, 2019 saw 1.2 billion tickets , during the height of the pandemic in 2020 sales dropped to 2.2 million tickets. So far in 2022, 838 million tickets have been sold to date, according to a market summary by TheNumbers. Although the numbers have risen slightly since 2020, that’s still a -31.4% decrease from 2018. But the holiday season is still to come.
Movie-theater attendance peaked in 2002, in the U.S. when they sold about 1.6 billion tickets, according to the Motion Picture Association. This year, numbers are expected to continue falling because not as many movies are being released to theaters.
This summer, just 22 films were launched in theaters, down 47.6% compared to 2019, Comscore data shows. And this is a trend that’s been seen all year long. From January to end of August in 2019, Hollywood released 75 films in cinemas. In 2022, so far, it’s only released 46, according to CNBC.
Despite nearly 50% fewer films being released this summer, the domestic box office still had $3.34 billion in ticket sales, down just 21% from 2019.
Backing up a bit
Recently, Americans spent more time watching streaming services than cable content marking the first time this has happened.
In July, streaming made up more than one-third of all television consumption in the U.S. Streaming services have quickly battled their way to the top.
With the rise in popularity of streaming services, many movie companies have been skipping theater releases opting for a streaming service release. Other companies have been releasing both in the theater and on streaming simultaneously.
Movies being released on the platform at the same time or solely on the platform has affected movie theaters heavily. People are opting to stay at home and watch rather than pay for a movie ticket.
