Heading out to the local multiplex this time of year is a holiday tradition, but don't be surprised if your ticket taker was sleeping on the job this past weekend. Domestic theater chains sold a mere $37.6 million in admissions over the weekend -- the worst showing since January of this year.

This is naturally uninspiring news for exhibitors, but they're not the only ones paying the price, when just 1% of the country went to the movies this past weekend. Movie studios making the films on the silver screen are struggling, even as they have digital distribution to catch audiences at home as a back-up plan. Neighboring restaurant and bar operators that rely on a steady trickle of customers stopping by before or after a movie will also feel the pinch.  

Even income investors could get caught in the crossfire. EPR Properties (EPR 1.15%) -- a real estate investment trust (REIT) that focuses on experiential properties -- relies on movie theaters for more than 40% of their business. EPR Properties' 8.1% yield may seem attractive on the surface, but that might not be the case if multiple operators don't get back to pre-pandemic levels soon. 

Folks laughing at a movie theater sharing popcorn.

Image source: Getty Images.

There's always a cliffhanger

There's a lot going on right now. A lot of people are watching the World Cup play out in Qatar. There are holiday parties to attend. Rising rates and fears of a looming recession may have folks prioritizing shopping for gifts over paying up to catch a flick at the cinema.

However, the numbers still sting. Box office returns are weaker than the $43.9 million delivered last year for the second weekend of December, when attendance was depressed. This is also well below the $117.8 million delivered in the comparable weekend of 2019. 

Walt Disney (DIS -0.28%) will come to the rescue this weekend. Avatar: The Way of Water premieres on Thursday night. The long-overdue sequel to the 2009 blockbuster will at least initially draw large crowds. But will it last? 

A lot is riding on Disney to save the day. In its earnings call last month, EPR Properties pointed out five big releases that it hopes will deliver strong ticket sales for its theater tenants in 2023. Four of the five -- sequels or reboots in the Ant-Man, Guardians of the Galaxy, Little Mermaid, and Captain Marvel franchises -- will be put out by Disney. EPR Properties expects the five announced releases to deliver North American admissions of at least $200 million apiece.

The bar is low when $200 million is the benchmark for a blockbuster in the eyes of EPR Properties. Disney had all six of the top draws of 2019, and the weakest of the lot still collected more than $515 million in ticket sales. Making matters worse, it costs a lot more to run a movie theater than it did three years ago. 

Disney will help improve sentiment this weekend, but that was also the case last month when Black Panther: Wakanda Forever led a short-lived pop in cinema traffic. It's been the top-grossing film for the past four weekends, but that's also the problem for movie theater stocks that sometimes have more than two dozen screens to fill. Having just one big movie out at a time isn't enough.

The bottom line is this: If EPR Properties expects to maintain that 8% yield, it's going to need theater chains to fill a lot more popcorn buckets than they are right now.