Movie-ticket revenue in the U.S. has risen 8 percent in 2018. That puts the industry on track for the largest year-to-year increase of the domestic box office in nearly a decade — and suggests that, surprisingly, theaters can more than hold their own in the age of widespread at-home entertainment.
But the news also comes with significant dark clouds. Industry experts say a future for the movie theater — an economic engine and cultural gathering spot for the past century — might be far from assured.
Fewer movies are powering the box-office returns. Well more than a third of revenue for 2018 comes from only 10 films, out of more than 700 released during the year. And two categories — superhero adventures and animated films — primarily are keeping the numbers afloat.
Some industry insiders even suspect some of the gains were driven by MoviePass, the beleaguered subscription service that provided heavy subsidies to millions of filmgoers in the first half of 2018, when the box office particularly overperformed.
“We’ve certainly had a strong year at the box office,” said Bruce Nash, a longtime expert on box-office returns who runs an industry site called the Numbers. “But there are a lot of signs this can’t continue. I think we’re going to regress to the mean very soon.”
The box office is an unusual economic indicator. It only partly reveals the financial health of film studios, as it fails to take into account production and marketing costs, both of which have been rising in recent years.
But it offers a window into something perhaps more important: whether those studios understand the entertainment that Americans wish to consume. And lately, whether Americans still value the country’s 41,000 movie theater screens, period.
In 2017, box-office dollars went down 2 percent, a troubling sign given that ticket prices and the U.S. population grow every year. Admissions — the number of tickets sold — dropped 6 percent to 1.24 billion, the lowest in 23 years.
This all coincided with an 11 percent spike in the number of Netflix subscribers in the U.S., a gain that put the streaming service’s tally of U.S. consumers above the 50 million mark for the first time. And Netflix, of course, is opposed to playing movies in a large number theaters.
The die seemed cast: Theaters were losing ground to streaming services, and fast.
But in February, the Marvel movie “Black Panther” opened. Suddenly, the tide seemed to turn.
The politically minded superhero release would gross $700 million in the U.S., the third most of all time.
It was followed two months later by another Marvel Studios production, “Avengers: Infinity War.” That film would gross $679 million — the fourth most of all time in the U.S.
The domestic box office has just set a new record: Revenue for the year hit $111.38 billion, topping 2016’s total of $11.37 billion, which previously was the highest ever not adjusting for inflation. And the 8 percent rise over 2017, if it holds, will be the largest since 2009, when revenue climbed 10 percent over the previous year.
The rebound could be a fluke, related more to the quality and anticipation of a few Marvel films more than any broad adaptation. Whether the gains are the result of one-off factors or a more fundamental shift will tell a lot about where the movie theater is headed in the streaming age.