Disney CEO Says Theatres Are Big Reason He’s Optimistic
Disney (NYSE:DIS) CEO Bob Iger says movie theatres are a big reason he’s optimistic about the movie business today.
“People love to be entertained in theaters around the world, and it gives us reason to be optimist about the movie business,” said the Disney CEO.
AMC Entertainment (NYSE:AMC) CEO Adam Aron, who leads the world’s largest movie theatre chain in the worlds was very pleased with Mr. Iger’s words about the movie industry.
“AMC is 100% in Bob Iger’s corner, We support him and Disney with our all,” Adam Aron said on Twitter.
Today, streaming platforms are realizing they will need the movie theatre industry to succeed in the entertainment industry.
Earlier this year, Disney announced the company was planning to lay off 7,000 employees as online streaming services tanked.
Iger says he’s “targeting $5.5 billion of cost savings across the company” and that the layoffs will “help achieve this.”
“Our priority is the enduring growth and profitability of our streaming business,” Iger says.
“Our current forecasts indicate Disney Plus will hit profitability by the end of fiscal 2024 and achieving that remains our goal.”
The Dependency for Movie Theatre Premiers is Strong
In October of 2022, AMC announced its first ever Netflix showing in 200 theatres.
Glass Onion: A Knives Out Mystery starring Daniel Craig was released in the U.S. as well as the UK, Ireland, Italy, Germany, and Spain.
CEO Adam Aron stated on Twitter that success here could lead to more Netflix (NFLX) movies at AMC.
The film earned $15 million at the box office but CNBC says the showing could have made $200 million if it had been kept in theatres longer.
The sequel to Johnson’s popular “Knives Out” opened in nearly 700 theaters, the largest release of any Netflix original film to date, 200 of which were AMC Entertainment theatres.
Unfortunately for the online streaming platform, hundreds of millions of dollars were left on the table.
Box office analysts say Glass Onion could have earned much higher earnings if Netflix had opted for a traditional wide release of 2,000 to 4,000 theaters.
CNBC stated, “Netflix has backtracked on its previous policies, including by introducing an ad-supported subscription option, leading many to wonder whether the company should rethink its resistance to the traditional Hollywood movie release model as it looks for new ways to grow revenue.“
“With a traditional wide release, premium screen spread, and full marketing campaign, I think ‘Glass Onion’ could have generated at least $50 million to $60 million to lead the entire market,” said Shawn Robbins, chief analyst at BoxOffice.com.
Retail Giants Invest Billions in New Movie Theatre Titles
Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) are now contributing billions of dollars to the movie theatre industry.
Amazon Studios released its first-ever original movie debuting in theatres globally on April 5th, 2023.
AIR tells the story of the game-changing partnership between Nike and a then-rookie named Michael Jordan.
So far, Amazon Studios has four original movie titles coming out with dates still to be determined.
The world’s largest online retailer aims to make between 12 and 15 movies annually that will get a theatrical release.
The movie theatre industry will also receive an additional $1 billion per year in theatrical titles from Apple.
AMC Entertainment CEO Adam Aron has said in the past that the only challenge the theatre chain currently faces is not having enough movie titles to premier.
Apple’s investment is part of the tech company’s efforts to raise its profile in Hollywood and lure subscribers to its streaming service, Apple TV+, Bloomberg reported, citing people familiar with the matter.
Bloomberg reports that Amazon and Apple must collaborate with various studios who have the knowledge of releasing films in theatres since they cannot release films in theatres on their own yet.
Wall Street is delusional to think the movie theatre industry is dead.
But I’d love to hear what you think — leave your thoughts below.
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