Harry Potter Puts a Spell on IMAX

While you were getting ready for last weekend's premier of Harry Potter and the Deathly Hallows: Part 1, the stock market was already rewarding IMAX (Nasdaq: IMAX) for what turned out to be a record-breaking weekend. Investors in Time Warner (NYSE: TWX) had apparently already priced in a big weekend, but IMAX investors got a late notice, pushing the stock up nearly 17% since the start of last week.

Unlike most blockbusters this year, Harry Potter didn't have the help of RealD (NYSE: RLD) 3-D or IMAX 3-D to push numbers higher. The only premium option was IMAX 2-D, but that didn’t stop movie patrons from shelling out a few extra Galleons to see Harry, Ron, and Hermione on an extra-large screen. The film set the record for overall IMAX box office in an opening weekend and the domestic showing stacks up pretty well against other big movies this year.

Inception and Harry Potter were both 2-D films, which don’t command quite the attention and dollars from IMAX theaters, accounting for some of the per-screen box office drop-off. Still, the low percentage of total domestic box office leaves me wondering if IMAX has lost its touch or if it's suffering at the hands of a younger audience that isn’t as willing to go for the premium ticket. DreamWorks (Nasdaq: DWA) and Disney (NYSE: DIS) Pixar films have both had less than 10% of domestic box office at IMAX theaters as well, so maybe I shouldn't overreact to the single-digit percentage.

The record weekend should lead to a solid result in the fourth quarter, but will probably fall short of the first quarter, which Avatar dominated. Avatar ended up making more than $200 million in IMAX box office and it's probably a bit of a stretch to expect that from Harry Potter.

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Further Foolishness

• The Theater Battle: RealD vs. IMAX
• IMAX Not as Big as It Seems
• DreamWorks Animation Is on a Roll