In this segment of the Market Foolery podcast, host Chris Hill and Stock Advisor Canada's Taylor Muckerman talk about the expected news that the latest chapter of the Star Wars saga demolished the box office this past weekend. But after a year in which U.S. ticket sales slid and other blockbusters were less explosive than expected, even a faster-than-light finish probably won't prevent 2017's domestic box office numbers from falling below 2016's and 2015's.
A full transcript follows the video.
This video was recorded on Dec. 18, 2017.
Chris Hill: To the surprise if absolutely no one, Star Wars: The Last Jedi came in No. 1 at the box office over the weekend, taking in $450 million around the world. Even with that, you look at the box office numbers here in the United States, this movie could put up these types of numbers for the next couple weekends and 2017 is still going to come in both behind 2016 and 2015, in terms of domestic box office in the U.S. Which is why the movie stocks, even on the heels of a weekend like this, you look at a movie theater stock AMC Holdings, they're just having a tough day.
Taylor Muckerman: Yeah. When you look at the box office sales, I'm not sure the exact percentage of that that the movie theaters actually retain, but I imagine it's much less of a percentage than what the filmmakers retain. They're really relying heavily on overpriced refreshments and snacks. And there's just so much competition out there for eyeballs and for your bottom dollar, especially during the holiday season. If you're going to go to a movie, maybe you just go to the movie. Maybe you just eat at home, or go out to eat before or after, and save your money that way. So, really struggling. You see some companies trying to do innovative things by hosting e-sports competitions and viewings like that. I think Cineplex in Canada is starting to introduce a Dave & Buster's style theme to some of their movie theaters, with some arcade games and things like that. But certainly, a struggling marketplace despite the success of some recent blockbuster hits.
Hill: It's going to be interesting to see if Disney (NYSE:DIS), now that it's going to have another couple of studios under the umbrella with the recent acquisition of the Fox studios, it's going to be interesting to see if Disney continues to flex its muscles with theater operators the way that it did with The Last Jedi, where you saw these stories where Disney was essentially dictating higher terms to the movie theaters, saying, we want a four-week commitment that these are going to be in your theaters, and there's going to be a financial penalty if you pull it early, that sort of thing.
Muckerman: Content is king.
Hill: Yeah, it really does seem like that. Have you seen the movie?
Muckerman: I have not. But there were a few empty seats around the Fool on Friday. I'm thinking there were some people playing hooky.