Disney’s movies face a big test, but Iger likes his chances
The movie business may be in a world of trouble, but at the premiere of Walt Disney Co.’s next big superhero film Thor: Ragnarok, Bob Iger sounded every bit as confident as the Viking space god himself.
“With Thor, Coco and Star Wars, I like our hand,” Disney’s 66-year-old chief executive officer said, ticking off his next three releases. “I don’t think one summer or one year tells us anything, other than you have to always be working at making great films.”
After the worst summer in a decade, U.S. ticket sales are down five per cent this year. And the big disappointments have been the types of films Hollywood has focused on: revivals and sequels like The Mummy and Transformers 5, along with Disney’s own Pirates of the Caribbean and Cars 3.
By buying Pixar, Marvel Entertainment and Lucasfilm for $15 billion over the past decade, Iger has staked more than anyone on turning familiar brands and characters into cinematic money machines.
Despite the doom and gloom in Tinseltown, it’s possible Disney’s next three movies outdraw the company’s late 2016 releases, led by the latest Lucasfilm installment, Star Wars: The Last Jedi, which hits theaters Dec. 15. There’s even a chance Disney’s results, along with other potential fall hits like Warner Bros.’ Justice League, help theatres match their 2016 ticket revenue.
I don’t think one summer or one year tells us anything, other than you have to always be working at making great films.
Eric Wold, an analyst with B. Riley & Co. in San Francisco, figures the domestic box office will finish one percent below last year’s record $11.38 billion. A few surprises to the upside could give a boost to beleaguered theatre stocks like AMC Entertainment Holdings Inc. and Regal Entertainment Group, the largest exhibitors.
They’re down 59 per cent and 22 per cent this year through Tuesday, respectively.
“Disney is driving the fourth quarter and the year, as they have been doing consistently,” Wold said. “Depending on how strong those movies do, you could have a record 2017.”
Disney declined 0.4 per cent to $97.94 at 10:29 a.m. in New York. The stock had fallen 5.6 per cent this year through Tuesday.
Ragnarok, the third Disney movie based on the hammer-throwing Norse deity, is projected to take in $105 million its opening weekend and $269 million through its domestic run, according to estimates from BoxOfficePro.com.
That’s enough to rank in the top 10 this year. It will be released Nov. 3.
Marvel, which was acquired by Disney for about $4 billion in 2009, is coming off a string of hits, including two Guardians of the Galaxy films and last year’s Captain America: Civil War.
The company has three pictures based on Marvel comics characters scheduled for next year. Keeping all of these superhero movies fresh is something Disney executives talk about “all the time,” Iger said. The key is new stories, new characters and new places for the heroes to go.
“We’re fortunate with Marvel we have so many characters to mine, so we’re revisiting old ones and meeting new ones,” Iger said. “In most cases where you have a movie that doesn’t work, it’s a failure of the creative process.”
The company is confident the new Thor will outdraw its predecessors, according to Alan Horn, chairman of the Walt Disney Studios.
In part because of fewer releases this year, the entertainment giant’s domestic box-office sales are down about 35 percent, according to researcher Box Office Mojo.
The 2013 release Thor: The Dark World, produced for about $170 million, collected $206.4 million in domestic ticket revenue and $644.6 million globally.
The new Thor has elements of Star Wars, The Hunger Games and even Ben-Hur, as the title character, played by Chris Hemsworth, battles his old ally Hulk in a gladiator arena.
Tom Hiddleston returns as Thor’s evil brother Loki, and Benedict Cumberbatch makes an appearance as Doctor Strange. There are also new roles, like Cate Blanchett as Thor’s even more evil sister, Hela, goddess of Death, and Jeff Goldblum as a villainous ringmaster.
Changes in tone are also important in keeping films fresh, Iger said. Perhaps taking a cue from 21st Century Fox Inc.’s irreverent superhero hit Deadpool, the latest Thor comes off as a comedian.
“There’s a lot of humour in this film,” Iger said. “There’s a lot of heart in it, too.”