The box office is back — but can it successfully reach pre-pandemic levels?
“The business is in recovery mode,” John Partilla, CEO of movie theater advertising company Screenvision, told Yahoo Finance Live this week.
Partilla said the industry “has been a business that has demonstrated great resilience over many, many decades,” adding Screenvision’s theatrical partners have “done a good job” at managing cash flows, focusing on loyalty, and investing in greater experiences like recliner chairs, higher quality sound screens, and more.
“I think we’ll continue to see the exhibitors innovate, experiment, and adapt,” Partilla said, hinting that more partnerships “and a lot of innovation” between movie theaters and streaming companies should eventually hit the market, as well.
According to Box Office Mojo, the domestic box office is down about 31% this year compared to 2019.
Coupled with that decline, the outlook looks bleak with Hollywood’s movie pipeline significantly slowing through the fall months amid post-production supply chain issues.
Additionally, most major theatrical chains like AMC (AMC), Cinemark (CNK), and Regal Cinemas remain unprofitable — despite soaring revenues in the second-quarter. Britain’s Cineworld Group (CINE.L), the parent company of Regal, is reportedly preparing to file for bankruptcy as a result.
Still, Partilla noted that the summer box office, led by record-breaking films like “Top Gun: Maverick,” “Minions,” and “Thor: Love and Thunder,” held its momentum at about 85% of 2019’s performance— “a good indicator of strength.”
“Maverick” in particular has been a beacon of hope for exhibitors. The Tom Cruise-led sequel has amassed more than $1.4 billion in worldwide ticket sales, topping “Titanic” to become Paramount’s highest-grossing domestic film of all time.
“People are clearly returning to that behavior of returning to their local cinema and enjoying that experience,” Partilla said, citing theatrical as a “massive business” opportunity in the long-term, especially for advertisers.
Screenvision, which also delivers advertising and content representation services for sports venues, e-gaming platforms, and other live events, works with more than 2,000 theaters nationwide, including 7 of the top 10 exhibitor companies.
Partilla said the company has seen “an increasing amount of investment in long-form advertising content,” explaining that “people are really valuing the unique impact and the attention that the cinema screen provides.”
“It’s not just about reaching impressions anymore for advertisers. It’s increasingly about the attention and the impact that those spots make on our screens,” Partilla said.
‘Guarded optimism’ over MoviePass return
The return of MoviePass, although highly debated in terms of its timing, seems to be drumming up support among those fastened in the movie industry, like Partilla.
“Anything that helps catalyze additional moviegoing attendance is a hugely positive dynamic,” Partilla said, although he did admit to “guarded optimism” around the controversial app’s return, mainly due to its “more restrained financial model” this time around.
In a new interview with Yahoo Finance Live, MoviePass co-founder and CEO Stacy Spikes said the timing couldn’t be better to re-launch the service, which will roll out in select markets beginning Labor Day Weekend.
A waitlist for the app’s beta version, which opened on Thursday, saw “overwhelming demand,” which caused the site’s servers to crash, the company said in a tweet. Spikes said 30,000 people signed up in the first five minutes prior to the server crashing for two-and-a-half hours.
“We’re really happy with people’s excitement about MoviePass coming back. That shows the retention that the brand has and consumer excitement,” Spikes said.
Alexandra is a Senior Entertainment and Food Reporter at Yahoo Finance. Follow her on Twitter @alliecanal8193 and email her at firstname.lastname@example.org
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