Walt Disney released its newest Pixar animated film last week, but the heartwarming tale of fire and water falling in love is expected to deliver disappointing returns for the company that produced megahits like Finding Nemo and The Incredibles.
Despite a strong critics' score of 79% on RottenTomatoes, Elemental was projected to take in just US$31 million (1.1 billion baht) to $41 million in US theatres this weekend, according to researcher Boxoffice Pro. That would be among the lowest debuts ever for the animation studio. By comparison, 2015's Inside Out, another original Pixar film, opened at $90.4 million. Elemental cost a reported $200 million to make and tens of millions more to market.
The performance of Elemental isn't the only concern for investors. Disney recently announced it's delaying several major live-action movies, pointing to problems for some of the Burbank, California-based company's most-valued franchises.
Disney pushed back the release dates for two of its Avengers films, by one year. Avatar 3 was delayed by a year, while two other sequels from the James Cameron-directed franchise were postponed by three years to as late as 2031. Fans won't see another Star Wars picture until May 2026, at the earliest.
The world's largest entertainment company declined to say why the films are being delayed, but the desire to push costs down the road, creative questions and a strike by Hollywood writers could all be factors, according to Bloomberg Intelligence analyst Kevin Near.
The extent of the delays suggests problems in the film division were festering before Bob Iger retired from Disney at the end of 2021 and have continued since his highly acclaimed return as CEO in November.
Iger was brought back to improve the profitability of the company, which last year generated a net income of $3.19 billion, a fourth of its 2018 earnings. Earlier this year, he announced a $5.5 billion cost-cutting effort that included trimming $3 billion from film and TV spending. A number of programmes have been cancelled and removed from the Disney+ streaming service.
Star Wars, among the most fabled film franchises of all time, was put on hiatus by Iger in 2019 after a Han Solo origin story disappointed. Since then several projects have fizzled out, including a trilogy in the works by Game Of Thrones writers David Benioff and D.B. Weiss. In recent years, Disney's Lucasfilm division has steered resources towards TV series like The Mandalorian and Andor for the Disney+ streaming service and away from Star Wars theatrical releases.
"We still are developing Star Wars films," Iger said at a Morgan Stanley conference in March. "We're going to make sure that when we make one, that it's the right one. And so we're being really careful there."
Pixar, which Iger bought shortly after becoming CEO in 2005, has had a string of recent disappointments, including last year's Lightyear, a prequel to the Toy Story films, that took in just $226 million worldwide, a fraction of its predecessors. The March 2020 release Onward, coming out just before US cinemas began shutting down due to the pandemic, delivered just $142 million globally. Other films went straight to streaming.
The Little Mermaid, a live-action remake of the 1989 hit from Disney, failed to draw international audiences in particular after its release last month. That was in part due to less-than-enthusiastic reviews and a racist backlash over the casting of black actress Halle Bailey in the lead role.
Even Marvel, the thoroughbred in Disney's stable, has shown signs of losing steam. The February release Ant-Man And The Wasp: Quantumania generated worldwide ticket sales of $476.1 million, below past instalments from Disney's comics arm. That led Iger to question the need for a third or fourth film based on any one character.
"If you look at the trajectory of Marvel over the next five years, you'll see a lot of newness," Iger said at the Morgan Stanley event. "We're going to turn back to the Avengers franchise, but with a whole set of different Avengers as an example."
It would be unwise to count Disney or Iger out. To some extent, the company is judged against its own successes, which have made it the envy of other Hollywood studios for many years. Last year's Avatar: The Way Of Water generated $2.3 billion worth of ticket sales and is the third highest-grossing picture in history. Guardians Of The Galaxy Vol.3, released in May, has crossed $800 million at the box office, in line with other pictures in the series.
Other Disney films due to hit theatres this year may perform well. They include Indiana Jones And The Dial Of Destiny this month, Haunted Mansion in July, and the animated film Wish in November. The chorus of that film's signature song, More For Us, is likely to strike a chord with executives at Disney's studio lot: "So I make this wish, to have something more for us than this." Bloomberg
Thomas Buckley is a Bloomberg columnist.
