The SAG-AFTRA Strike Is Already Hitting Hollywood's Bottom Line At The Box Office
As recounted in this week's Tales from the Box Office column, "Blade" screenwriter David S. Goyer was told by New Line studio head Mike Luca that the budget he got for the movie would depend on which lead actor he could attach to it: "I'll make it for $40 million if you can get Denzel Washington, 35 if you can get Wesley Snipes, and 20 if you can get Laurence Fishburne."
25 years after "Blade" hit theaters, star power is still a major factor in studio calculations, which is why movies like "Strays" and "Teenage Mutant Ninja Turtles: Mutant Mayhem" tend to recruit celebrity "face actors" for their voice roles, rather than less famous but more experienced voice actors. The value of celebrity stars comes not only from putting their names in the trailer and on posters, but also from the actors themselves promoting movies on the talk show circuit, on press tours, and finally on the red carpet. But due to the ongoing SAG-AFTRA strike, actors are currently prohibited from doing any promotional work, and several studio sources told The Hollywood Reporter that the movies currently hitting theaters are losing out on as much as 15 percent of their box office potential due to the lack of actor-driven publicity.
This is significant because the impacts of the WGA and SAG-AFTRA strikes have so far been mostly deferred. A months-long gap in the production pipeline is going to become a real problem by the start of next year, especially for studios who are dependent on box office revenue. But corporations and shareholders tend to focus on numbers quarter-by-quarter, rather than worrying about what things will look like two or three quarters into the future. The recent round of second quarter (April-June) earnings calls saw studio execs assuring shareholders that they have plenty of upcoming TV shows and movies in reserve, and the strikes aren't causing any immediate problems.
The box office disagrees
Without access to a parallel universe, it's impossible to say exactly how much recent movies would have grossed if their stars had been able to chat with Jimmy Fallon, walk the red carpet, or even simply post, "Hey, I'm in this movie" on social media. But according to THR, insiders believe "Teenage Mutant Ninja Turtles: Mutant Mayhem" will take a $7-10 million hit at the box office due to the WGA and SAG-AFTRA strikes. The voice cast includes Seth Rogen, Jackie Chan, Maya Rudolph, Ayo Edebiri, John Cena, Ice Cube, Paul Rudd, Post Malone, Rose Byrne, Natasia Demetriou, Giancarlo Esposito, and Hannibal Buress — who between them have more than 94 million followers on Instagram alone. "Can you imagine what the group photo [of stars] would have been like on the carpet?" one source posited to THR.
The lack of star power in publicity for recent releases like "Mutant Mayhem," "Strays," and "Meg 2: The Trench" is particularly stark when compared to "Barbie." The pink-infused sensation released a week after the SAG-AFTRA strike began, but already had plenty of promotional material from stars Margot Robbie and Ryan Gosling banked, and there's no question that it added an extra rocket booster to the box office. Promotion for "Barbie" in the lead-up to release included Gosling giving GQ a guide to Ken's must-have objects, Robbie giving Architectural Digest a tour of the Barbie Dreamhouse, and the duo doing a Buzzfeed interview while playing with puppies.
"Barbie" made $1 billion worldwide in just 17 days, and with a running domestic total of $567.2 million it's poised to overtake "The Super Mario Bros. Movie" any day now as the highest-grossing movie of the year in North America. Will that ease the financial pressures of the strikes? Not necessarily.
The mixed blessings of Barbenheimer
Some of the heavy-hitters represented by AMPTP in the ongoing negotiations, like Apple and Amazon, are under less pressure from the strikes because original movie and TV productions only represent a small fraction of their overall revenue. (Apple has tech, Amazon has retail.) But Warner Bros. Discovery and NBCUniversal, the corporations behind "Barbie" and "Oppenheimer," respectively, are much more dependent on box office ticket sales. Warner Bros. Discovery's latest earnings report showed that around a quarter of the company's revenue came from the Studios segment.
Wall Street's obsession with growth means that a monster hit one year can make the numbers look worse the following year. For example, Paramount's revenue from filmed entertainment dropped 39 percent in Q2 2023 compared to 2022. The culprit? "Lower theatrical revenues due to the release of 'Top Gun: Maverick' in the prior-year period." With production on "Beetlejuice 2" and "Twisters" — the only movies Warner Bros. had scheduled so far for Q3 2024 — suspended due to the SAG-AFTRA strike, "Barbie" is setting the studio up for a dramatic drop in box office revenue next year.
The combined forces of "Barbenheimer" gave the box office its biggest weekend since the pandemic began, and they've both enjoyed a strong hold since then. But that's partly down to the fact that subsequent big releases — from "Haunted Mansion" to "Blue Beetle" to "Strays" — aren't seeing close to that kind of success, and insiders are pointing to the lack of publicity as a significant factor. With studios taking a hit to the bottom line every weekend, the strikes can no longer be dismissed as tomorrow's problem.