This was the weekend that exhibitors had been circling on their release calendars for some time. Walt Disney's (DIS +0.31%) Avatar: The Way of Water hit a multiplex near you, and the highly anticipated sequel to James Cameron's bar-raising Avatar theatrical achievement in 2009 was supposed to get box office receipts back on track. It didn't exactly work out that way.
The film generated $134 million in domestic ticket sales over the weekend, woefully short of industry analysts' predictions for as much as $175 million in admissions. More importantly, the film's debut didn't generate the halo effect you would see in the past at the premiere of a major blockbuster. Years ago, the arrival of a "must-see" film would draw crowds to the nearest cinema, and if the desired screenings were sold out they would settle for other films. It didn't happen here.
The overall gross of ticket sales for domestic exhibitors was $152.5 million this past weekend. That's about just $18.5 million in ticket sales for movies that didn't involve flying banshees in the richly rendered land of Pandora. Compare that to the halo effect of the original Avatar. The rest of the movies for that debut weekend 13 years ago was a more respectable $61 million, and that was when the average ticket price was just $7.50. People are paying closer to $10 a screening now.
Something is wrong with the industry. Disney's pixie dust wasn't enough to bring it back to life.
Image source: Getty Images.
The way of gravity
There are some silver linings. It was a strong showing by Imax (IMAX +0.19%). The provider of supersize theatrical experiences accounted for $48.8 million in ticket sales worldwide over the weekend, the second-largest opening in the platform's history. It delivered an outsize 11.2% of the film's global box office receipts and 12.3% of the domestic ticket sales. Imax was particularly resilient in China where it served up 27% of the film's box office despite being in just 1% of the total screens. Imax tends to feast when Cameron is rolling.
The film itself also wasn't a dud overseas. It topped $300 million in international ticket sales, bringing total worldwide box office returns to roughly $435 million over the weekend.
For domestic exhibitors it's an absolute victory, but you won't see too many high-fives and victory laps if you're going on a relative basis. This may be the second strongest weekend of ticket sales in the past five months for stateside multiplex operators, but it was well short of the $209.5 million collected during the debut of Black Panther: Wakanda Forever just last month.
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Key Data Points
This isn't the end for Avatar's sequel -- in more ways than one. Disney and Cameron have three more releases slated in the coming years. You won't have to wait 13 years for the next entry. It also might be too soon to call it a failure. Holiday shopping and the World Cup finals likely kept potential moviegoers busy over the weekend.
The film did generate mostly positive reviews. The 78% approval rating from film critics polled by Rotten Tomatoes may not seem like a lot, but a whopping 94% of the viewers who saw the movie enjoyed it. Positive word of mouth could keep popcorn-hungry audiences coming through the holidays and into January. The challenges are real for movie theater stocks, but this buzzy release still has a chance to recover its massive production budget as well as keep multiplex owners optimistic for a 2023 recovery.
