As US Movie Theaters Reopen, Overseas Shutdowns Could Stall Box Office Recovery

Movie theaters in the U.S. may be on the road to recovery, but the still-widespread cinema closures in South America and Europe are creating headaches for Hollywood studios as they try to figure out how to release films that rely heavily on overseas box office. The state of the box office changes wildly depending on the region. China’s box office has fully recovered, as seen with the success of the Lunar New Year period and the $70 million opening for “Godzilla vs. Kong” there last weekend. Other markets in the Asia-Pacific region are showing significant progress as well, as “GvK” outperformed the entire Australian run of 2019’s “Godzilla: King of the Monsters” with a $6.3 million opening and earned $2.4 million in a steadily rebuilding Korean market. But then there’s Europe, where rapid spread of infectious COVID-19 variants and struggles with vaccination distribution have forced major markets like France, Italy and Scandinavia to close theaters. And in Latin America, “Godzilla vs. Kong” earned a higher opening than “King of the Monsters” in Mexico with $6.3 million; but several other major countries are still closed, particularly Brazil, which has become the new nexus of the pandemic as the virus has spread out of control thanks in part to a new variant that originated in Manaus. 

Such problems are believed to be a major factor in Disney’s move of the Scarlett Johansson Marvel film “Black Widow” from May to July, but distribution execs told TheWrap that all the studios have come to accept that no matter how they release their tentpoles this summer, some major parts of the global box office will probably be left behind. “Right now in Western Europe, we’re expecting theaters to be closed at least through mid-May,” said one exec who asked to remain anonymous. “But it’s really likely that even by the time we reach mid-summer, we’re going to be seeing 25% capacity at best over there. What every studio is doing right now is looking at their films and the current state of theaters and vaccines in different markets and asking, ‘Which markets could we afford to go without’?” Boxoffice editor Daniel Loria points out that the current situation is a reversal from last summer, when the U.S. theatrical market was struggling to reopen while the rest of the world was ready to receive Warner Bros.’ “Tenet,” which earned 84% of its $363 million global total outside the U.S. And a lot will depend on AMC Theatres, Cinemark and Regal parent company Cineworld, the three big multinational chains that also have a significant footprint in overseas markets still closed by the pandemic. “We’re seeing Disney and Sony move their films into July or September, and that’s fine for AMC and Cineworld because they also have hundreds of theaters in Europe and have a chance to see revenue from both continents for these delayed blockbusters. The same goes for Cinemark, which has a huge presence in Latin America,” Loria said. “But the independent cinemas, which don’t have that overseas presence and really need major titles in the next few months, could be in trouble unless films like ‘Godzilla vs Kong’ do really well or they’re able to get some help through government aid.” On the flip side is Warner Bros., which has left its 2021 slate largely unchanged since it’s opening film simultaneously in theaters and on HBO Max. While that strategy could limit box office, particularly in markets where theaters are shut down, it also means that big Warner titles like “Godzilla vs. Kong” face less big-budget competition in the coming months (especially since Disney pushed “Black Widow” out of May). In between Warner Bros. and the Disney/Sony approach is Universal, which has a slate that runs the budget spectrum. The studio released the low-budget action film “Nobody” to strong critical and audience reception in the U.S. and a $7 million domestic opening, hoping to leg out as theaters continue to reopen even with “Kong” as competition. On the flip side is “F9,” which recently moved from May to June 25. But since the two most recent titles in the franchise grossed $1 billion outside the U.S., the studio may opt to postpone the film again until more countries have reopened theaters to fuller capacity. According to insiders, late June and early July will be the next “inflection point” for the box office. There’s still a sense of hope that as 2021 marches on and more people get vaccinated, the overall global recovery will improve. But the start-and-stop nature of virus containment efforts in different parts of the world is complicating things for theaters or studios alike. “There’s probably going to be some point for each studio where they can’t postpone any longer,” Loria said. “Where that point is will change depending on the studios, and whether or not the studio has made an agreement with some of these theater chains like Universal and Warner Bros. have will probably play a factor.”