When The Hunger Games: Mockingjay, Part 1 collected $121.9 million during its domestic weekend debut last month, it was surprising at first to see the market punishing shares of Lions Gate Entertainment (NYSE:LGF-A) with a 5% drop the following Monday. After all, no other film has come close to that domestic opening so far this year.
That even includes Viacom's (NASDAQ: VIA)(NASDAQ:VIAB) Transformers: Age of Extinction, which enjoyed a U.S. launch of just more than $100 million en route to this year's top worldwide cume of $1.087 billion. But that was little solace to Lions Gate shareholders, especially considering last year's The Hunger Games: Catching Fire opened to a whopping $158.1 million, which seems to indicate moviegoers' enthusiasm for the dystopian franchise is waning.
As fellow Fool Tim Beyers pointed out, however, Mockingjay, Part 1's seemingly subpar performance was primarily due its absence on IMAX (NYSE:IMAX) screens, which are still occupied by the space epic Interstellar. For perspective, IMAX contributed $17.1 million to Catching Fire's opening weekend last year, according to The Wrap, which explains the bulk of Mockingjay, Part 1's underperformance.
Worse yet, Mockingjay simply isn't listed in IMAX's upcoming movie slate, likely thanks to a combination of underground and close-quarters scenes that weren't suitable for the IMAX format, as well as solid IMAX-filmed alternatives in Interstellar and Time Warner's (NYSE:TWX) impending release of The Hobbit: The Battle of the Five Armies.
But the lack of IMAX's help doesn't mean The Hunger Games: Mockingjay, Part 1 can't still rival the financial performance of its predecessor.
The road to $800 million
How is that possible?
First, consider domestic audiences, which contributed 49.1%, or $424.7 million, of Catching Fire's total $864.9 million gross. That puts Catching Fire's opening weekend multiple -- i.e. total sales divided by first-weekend sales -- at roughly 2.69. Both Catching Fire and Mockingjay, Part 1 saw almost identical second-weekend drops in sales of just more than 53%, so let's assume the latter continues that trend through the remainder of its theatrical run. Using the same opening weekend multiple, that would put Mockingjay, Part 1's domestic gross at roughly $328 million.
Next -- and here's where things get really interesting -- international audiences chipped in the remaining 50.9%, or $440.2 million, of Catching Fire's total. Keep in mind, however, that the Hunger Games franchise continues to gain steam with overseas viewers.
Catching Fire's performance was a significant improvement over the $283.2 million international haul seen by 2012's The Hunger Games, which ended up representing only 41% of the first film's global gross. And sure enough, Mockingjay, Part 1 managed an impressive $152 million during its international debut, a roughly 10% improvement over Catching Fire's $138.2 million during the same period.
At this rate, as long as Mockingjay, Part 1 doesn't unexpectedly lose momentum worldwide, its international total should be somewhere in the neighborhood of $485 million. Add that to the domestic figure I calculated above, and Mockingjay, Part 1 would finally come to rest with a worldwide total of $813 million.
And yes, that's still a fair bit below Catching Fire, but it's also nothing to scoff at, especially considering Mockingjay, Part 1 not only doesn't include IMAX, but also was assigned a production budget of $125 million -- a full $5 million less than it required to bring Catching Fire to life.
I'm convinced that those criticizing Lions Gate stock for the supposed underperformance of Mockingjay, Part 1 are simply unjustified.