Blog > The Decline of Big Budget Blockbusters

The Decline of Big Budget Blockbusters

Expensive movies and franchises are going from sure bets to financial flops

990 words, ~ 5 min read



Aquaman 2 is set to release soon, yet Jason Momoa, the lead star, says "It's not looking too good." Peculiarly, the first Aquaman movie did tremendously well (the best in the DCEU), earning over $1 billion at the box office. The new DCU helmed by James Gunn may be a part of why; if the universe is set to restart with Superman: Legacy in 2025, why care?

Marvel is struggling with its comic book movies. Ant-Man and the Wasp: Quantumania, the first major introduction of Kang, didn't even break-even. The Marvels became the lowest grossing film in the entire MCU. Loki is an exception to this trend, with its second season getting positive reviews, but was released on Disney+ instead of theaters.

Movies are a form of creative expression, but for large studios, they are revenue sources.

Big blockbusters were seen as sure ways to get people going to movies - the Transformers movies, despite poor reviews and inconsistent plot, has multiple billion dollar entries.

Some of the highlights from 2017-2019 (pre-COVID) include Star Wars, MCU (Avengers, Black Panther, Spider-Man), DCEU (Wonder Woman, Aquaman), Joker, and Disney remakes (Aladdin, Beauty and the Beast). Almost every movie, outside of Bhohemian Rhapsody, is a part of a larger franchise.

2021-2023 (post-COVID) is a mix of movies. 2023 especially has the success of Barbie, Oppenheimer, and the Super Mario Bros. Movie as the top 3. Avatar did incredibly well (to be expected given its predecessor's success), but what's more interesting is the high number of movies not on this list: the MCU and DCEU movies like The Flash, Shazam 2, and Doctor Strange 2 (which didn't make as much it should have).

It's unknown how Hollywood will react. Here are my predictions.

  1. An increase in director-led/actor-led movies

Tom Cruise's Mission: Impossible series is still going strong, with the latest movie Mission: Impossible – Dead Reckoning Part One doing incredibly well. Cruise has a lot of control over the movies to deliver what audiences want. These movies are very expensive (nearly 300 million), as he does the stunts in reality, but it continues to draw people in. Top Gun: Maverick also did well, where he brought back iconic elements from the original movie but also added new elements beyond the nostalgia.

Christopher Nolan is another great example. He started with movies that had small budgets, like Memento, with only 4.5 million. Once he saw major success (to the tune of billions) with the Dark Knight Trilogy, he transitioned towards more experimental movies. Some performed well, like Inception and Interstellar, but others did not, like Tenet, partly due to the confusing story and releasing in 2020. Oppenheimer, a movie about a physicist of little public interest, did incredibly well, granting him the power to lead movies in the future.

  1. More IP-led movies, especially those that had previous failures or no movies at all

Given the huge success of Barbie, Mattel is intending to make franchises off their toys. Nintendo is doing the same thing for Zelda after Mario. This is similar to when Marvel first started making movies, back when it was licsensing out its IP such as Fantastic Four to Paramount. Odds are high that some of these movies will be bad, and it falls into the same trap of exhaustion.

  1. Fewer superhero movies

Spider-Man: Across the Spider-Verse is a good example of this. It takes on the multiverse differently (and is a sequel to a well-received movie). It's also animated, which is cheaper than live-action (only 100-150 million). Another great example is The Batman, or Joker, both of which did well by focusing on independent stories. These movies have to prove themselves to audiences, and can't rely on the franchise name to bring people in.

With regards to the MCU, Disney CEO Bob Iger has stated that things will slow down to emphasize quality. This is a step in the right direction, but Marvel will have to be careful about its strategy given Disney's acquisitions of the newly acquired X-Men and the already established multiverse.

  1. More niche movies, with some content going straight to streaming

Netflix knows this - getting as many Adam Sandler films as possible. They're not great movies, but they're cheap and bring in a lot of viewers. They also have a lot of niche movies, like The Mitchells vs. the Machines, which was originally going to be released in theaters but was sold to Netflix for $110 million.

ROI (return on investment) is key, but not all-encompassing; for movies with smaller budgets, it's easier to get higher ROI. In 2017, Split by M. Night Shyamalan had over 2,000% ROI.

  1. Cutting budgets

A movie that cost 250 million to make doesn't just need that to break-even; there's marketing and a lot of other costs incurred. That movie getting 400 million at the box office is a loss, not a win, independent of Hollywood accounting.

A24 is doing a fantastic job of this. Their movies are award-winning while earning money on small budgets; A24 is a symbol of movie quality. Everything Everywhere All At Once made around 140 million on a budget of approximately 20 million. Uncut Gems made around 50 million on a budget of approximately 19 million.

There will also a push for digital assets to reduce budgets further. The technology isn't quite ready yet to remove actors and directors, but it is getting close enough to drop extras. There was a large strike, to protect workers, but I remain skeptical that it will be enough to stop the push for digital assets. The strike is also a confounding factor on movie performance, but not enough to explain the entire trend.

Reference Data

For reference, here are the top 10 highest grossing movies from 2017 to 2019:

And here are the top 10 highest grossing movies from 2021 to 2023:

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