It’s official: 2016 is the summer of scary movies.
New Line Cinema and Warner Bros. made another big win this weekend with PG-13 horror movie “Lights Out.”
Made on a small production budget of just $5 million, the movie more than quadrupled that with its huge $21.6 million opening in 2,818 theaters. To compare, it narrowly beat Fox’s “Ice Age: Collision Course” sequel, produced for 21 times more than the scary movie with a big $105-million budget.
“It’s friggin’ awesome,” said Jeff Goldstein, Warner Bros. Executive Vice President of domestic film distribution. “Whenever you can gross more than four times your budget on the domestic opening weekend, that’s a grand slam home run,” he told TheWrap.
Produced by master of horror James Wan (the “Saw” franchise), Goldstein emphasized New Line’s expertise in the genre, which dates back to 1984’s “Nightmare on Elm Street” and its subsequent sequels. He also credited the movie’s marketing campaign with its better-than-expected opening.
The film, starring Teresa Palmer as a young woman who fights off a supernatural entity that has attached itself to her mother, represents the directorial debut of David Sandberg.
While Goldstein hadn’t yet run the numbers on the movie’s profit margin, he did say, “It’s on a path to scoring big profit.”
And that margin is already pointed at a higher percentage than the hugely successful “Conjuring” sequel, also by New Line and Warner Bros.
As TheWrap has previously reported, scary movies sell tickets more reliably than almost any other genre — big-budget superhero movies included.
Not only that, the revenue margins — and profits — of horror movies are higher since production (and marketing) costs are typically much, much lower.
“If we were to reconfigure box office charts based on profitability, movies like ‘The Shallows’ and ‘The Purge: Election Year’ would be right at the top,” comScore senior analyst Paul Dergarabedian said.
Add “The Conjuring 2” — and now “Lights Out” — to that list, and you have movies that represent the highest revenue margins of the summer. That says a lot as the season has been sluggish compared to past years.
Just compare the highest-grossing film of the summer — “Captain America: Civil War” — to the highest-grossing horror film of the season, “The Conjuring 2.”
The Disney-Marvel action sequel was made for $250 million and has grossed $406.8 million domestically. The New Line-Warner Bros. scary movie has made $101.6 million in grosses so far and was made on a production budget of $40 million.
Factoring in an assumed 50 percent in marketing costs, the domestic revenue margin for “The Conjuring 2” is nearly 40 percent. By that same math, the percentage of return for “Civil War” is about 8 percent.
Another example of a horror movie propping up a studio’s tent: Blumhouse-Universal’s “The Purge: Election Year,” which grossed $43.7 million in its first week on a mere $10 million production budget. Its strong opening put it at a revenue margin of 63 percent, or $25.5 million. Having now earned $76.6 million domestically, that margin only went up.
“To make the budget back on opening night — that’s a wonderful thing,” Brad Fuller, executive producer on all three “Purge” films, said. “There’s always been an audience for horror movies. The great thing is they’re generally not as expensive as other tentpoles, there’s more wiggle room.”
Universal’s president of domestic distribution, Nick Carpou, told TheWrap that the film’s big opening is “not coincidental,” crediting the success of the film, in part, to the series’ concept.
All three “Purge” movies revolve around a day when it’s deemed legal to kill fellow citizens. “It taps into very primal fear that’s very relatable,” Fuller added.
“Horror films are always bankable unless they’re flat-out awful,” Dergarabedian added. “Sometimes the simplest concepts are the ones that resonate the strongest.”
When it comes to “Lights Out,” Goldstein shared, “$17 or $18 million would have made us happy. To do $21. 6 million is extraordinary.”