The movie industry’s recovery from the COVID-19 pandemic has been significantly slower than experts expected.
Signs of Hollywood’s post-COVID struggles are visible throughout the industry. Studios are releasing far fewer movies than they were before pandemic. Cineworld — the owner of Regal Cinemas, one of the biggest theater chains in the country — is preparing to file for bankruptcy. Earlier this month, Cineworld reported that it is “evaluating various strategic options” in response to slowing attendance.
Warner Bros., one of the five major movie studios, is adjusting its release calendar as its new parent company attempts to cut costs. The Los Angeles Times writes that David Zaslav, CEO of the newly merged Warner Bros. Discovery, is seeking “$3 billion in cost savings from the combination of WarnerMedia and Discovery Inc. assets.”
John Fithian, the head of the National Association of Theatre Owners, told Insider that the association doesn’t expect movie supply to be back to pre-pandemic levels for at least another year. Fithian remained optimistic, however, adding, “When the movies are there, moviegoers are coming.”
Hollywood has had some successes this year. “Top Gun: Maverick” has earned close to $700 million just in U.S. ticket sales. Certain franchise movies like “Doctor Strange in the Multiverse of Madness” and “Jurassic World: Dominion” have performed well.
However, these few hits aren’t indicative of the industry’s overall trend. Analysts with the Wall Street firm MoffettNathanson projected that box-office revenues would end up at $7.9 billion this year, “with only modest growth to $8.5 billion in 2023, still down -26% from 2019,” reports Insider. “The US film industry is in dire need of restructuring and we expect to see a drop in US screens as the business looks to normalize,” the MoffettNathanson analysts wrote.
Even the new-media companies that have introduced additional competition to Hollywood’s giants haven’t been immune to the changing market. In June, Netflix laid off 300 employees in response to slowdown in revenue and loss of subscribers.
So where are people going for entertainment? The Hollywood Reporter notes that live events are flourishing. A source told THR, “Demand is still insane” for live events. “If there’s a recession, we aren’t seeing it in that space. Tickets are still flying, and at higher prices than before the pandemic.” The source added that “there’s no sign of it slowing down anytime soon.”