How often do movies lose money?
There's no industry on the planet that loses money on 80% of its projects, but recoups it all on the remaining 20%, especially when they spend $25 million to upwards of $250 million on each (like filmmaking). I compare this to the belief that brick-and-mortar stores don't become profitable until Black Friday.
What percentage of Hollywood movies make a profit? Using my 'Insider' dataset of 279 Hollywood movies I found that overall 51% made a profit and 49% made a loss. This pattern of 50:50 seems to be the common understanding of movie economics among the insiders I spoke to.
In the film and media industry, if a film released in theatres fails to break even by a large amount, it is considered a box office bomb (or box office flop), thus losing money for the distributor, studio, and/or production company that invested in it.
Most films lose money. Indeed, 80% do. The fundamental reason for this phenomenon is simple.
Almost no movies are making money right now. Yes, a few horror films like Universal's “Halloween Kills,” which are made cheaply, are still enjoying healthy profit margins, but the business that is reemerging from its COVID torpor still has a lot of ground to make up.
The reason a majority of movie studios still turn a profit most years is that they have found ways to, as they say, monetize the ancillary stream by selling pay-TV and overseas rights, creating tie-in video games, amusem*nt-park rides and so forth. And the big hits, rare as they may be, pay for a lot of flops.
1. The 13th Warrior (1999) Based on the novel Eaters of the Dead by Michael Crichton (who would direct some re-shoots) and a loose retelling of Beowulf, The 13th Warrior is famous for its huge flop at the box office in 1999.
A box-office bomb, or box-office disaster is a film that is unprofitable or considered highly unsuccessful during its theatrical run.
Typically, the investors are repaid in full, and then the money is split 50:50 between the Investors' Pool (i.e. profit for the investors) and the Producers' Pool (i.e. the money shared with certain members of cast and crew who were assigned a share of profits).
With extra costs incurred to move the film away from the worst months of the pandemic, it seems like No Time to Die will need to make somewhere between $800 and $900 million just to break even (according to Variety). The real question is, can it do that?
What makes a movie financially successful?
There's merchandising, VOD, streaming video, foreign sales, and a plethora of other distribution channels that can help filmmakers, producers, and studios turn a profit.
As per KPMG estimates, at least 77 per cent of a film's revenues still come from theatrical rights, followed by satellite and overseas rights at 7 per cent each, home video at 5 per cent and other revenue streams at 4 per cent.
How many “domestic flops” have there been? Using the criteria I laid out above, 544 movies 'bombed' – 18.6% of all releases. Over 40% of all historical films which opened in a wide release over the ten years I studied flopped (by my definition) – unlike animations, where only 12% failed to hit the mark.
Producers and the distributors
When a movie flops or fails to perform well at the box office, these two people (producer and distributor) bear the brunt of the blame, while the actors (all actors, including male and female leads, supporting casts, etc.)
It cost too much
The more a film costs to make (and market), the more it has to make to avoid flopping at the box office. Film studios are making fewer and fewer movies as the years go by, but they tend to cost much more over time, so perhaps it's not surprising that there seem to be more and more flops.
| Rank | Title | Lifetime Gross |
|---|---|---|
| 1 | Avatar | $2,847,397,339 |
| 2 | Avengers: Endgame | $2,797,501,328 |
| 3 | Titanic | $2,201,647,264 |
| 4 | Star Wars: Episode VII - The Force Awakens | $2,069,521,700 |
Gone with the Wind—first released in 1939—is generally considered to be the most successful film, with Guinness World Records in 2014 estimating its adjusted global gross at $3.4 billion.
Actor. The Hollywood Reporter estimates that A-list movie stars routinely make $15 million to $20 million for top roles in big-budget films. Secondary lead actors in a movie such as "The Force Awakens" earned an estimated $1.5 million to $4.5 million.
Generally speaking, for screen work, actors are paid a day rate. If they are needed for more than five days, they are paid a weekly rate. Rates vary if actors are needed for the entirety of the film shoot or the entirety of a television season. Television actors can also be paid per episode.
Marketing: The most important part of how to make a movie as well as an expensive magic potion that it requires is its marketing. With all the huge investments of more than a hundred million dollars, you don't want it to go unheard.
What is the lowest paid movie of all time?
The film gained notoriety from its gross ticket sales of only $30 on its opening run, due to its intentionally limited release at a single cinema, making it the lowest-grossing film in U.S. history in terms of box office sales.
As of June 2022, the four biggest movie flops of all time were Disney productions. "Turning Red" (2022), "Jungle Cruise" (2021), "Mars Needs Moms" (2011), and "Mulan" (2020) recorded losses of more than 140 million U.S. dollars at the global box office.
Pixar's lowest-grossing film, pre-COVID, The Good Dinosaur was beset with story problems, production delays, and reports of directors being replaced midstream.
A Box Office Bomb (or less severely, a flop) is a movie for which production and marketing cost greatly exceeds its gross revenue, ergo fails to turn a profit for the studio behind the film.
- For Tevar to be a All Time Blockbuster - Rs 175 crore or more.
- Blockbuster - Rs 140 crore or more.
- Super Hit - Rs 110 crore or higher.
- Hit - Rs 90 crore or higher.
- Average - Rs 70 crore.
- Flop - Anything less than Rs 60 crore.
Average Cost of Making a Movie
The average cost of making a feature film is between $100 million and $150 million. Keep in mind that this is an average, meaning that there are feature films that cost less than $80 million and those that cost more than $200 million to produce.
Directors and producers work behind the scenes of movies, television and other industries. While not as prominent as actors, they can make a lot of money working in the film industry. While some film directors and producers make six figures with ease, the majority of directors and producers make more modest incomes.
Now, thanks to Vanity Fair, you can rest assured that the Hollywood hierarchy is alive and well. In the video below, VF estimates the breakdown of a $200 million blockbuster. Unsurprisingly, above-the-line talent scores the biggest paycheck; Lead Actors 1, 2, and 3 comprise 9% of the film's entire budget.
With extra costs incurred to move the film away from the worst months of the pandemic, it seems like No Time to Die will need to make somewhere between $800 and $900 million just to break even (according to Variety). The real question is, can it do that?
A studio might make about 60% of a film's ticket sales in the United States, and around 20% to 40% of that on overseas ticket sales. The percentage of revenues an exhibitor gets depends on the contract for each film. Many contracts are intended to help a theater hedge against films that flop at the box office.
How much money do you need to make a movie?
Average Cost of Making a Movie
The average cost of making a feature film is between $100 million and $150 million. Keep in mind that this is an average, meaning that there are feature films that cost less than $80 million and those that cost more than $200 million to produce.
Yeah, the residuals/royalties are likely paid out based on the price paid by Netflix and the agreements with the directors. For example, if your agreement is that you get 1% of all streaming revenue in perpetuity and Netflix licenses the movie for 1month @ $1mil, you'd get a check from the property owner for $10k.
