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Published on April 1st, 2012 | by simeon


John Carter is Not a Box Office Bomb and Will Make Money for Disney

UPDATED 12-9-12
The film had a reported budget of $250 million and to date has earned $282 million according to Box Office Mojo. Now I know that promotional fees have to be factored in, but consider that the film made $19.3 million roughly its first week on DVD and Blu-ray and that does not factor in sales to date you can see that the idea of it earning a profit as I stated months ago is not out of the question and likely has already happened.

Disney raised eyebrows a couple of weeks ago when they stated that they expect to lose $200 million on their movie “John Carter”. The film cost 250 million to make and of course there are the additional costs for ads, promotion, and so on that drive the final cost way up. However, things are not as bleak as they appear. To date the film has made $254,510,000 worldwide. While that is no to the cost of making the film, the studio should pass the $250 million worldwide total by next weekend.

Disney said they will lose $200 million on it which I find very odd as lucrative income from DVD and Blu Ray sales, cable, pay per view, on demand, and on air broadcast rights have yet to be factored in. Many films actually make more money from the home entertainment side of things than they do at the box office, hence the faster and faster turnaround from cinemas to the store shelves for many titles.

To get to the bottom of the mystery, one must look at the fine print which says it all, “this quarter”. Sure Disney will lose money now as they have to pay for the film and ads and such. However, down the road the film will end up making a nice profit for the studio once all revenue factors are considered. You have to spend money to make money in business and while the return has not been as large or rapid as Disney had hoped, they will come out ahead in the end. I have always said. Hollywood math can be shady, and that it is very hard for a studio to lose money long term on a movie.

Many films have had their sequels come down to how well a film does in the home entertainment market, and while I would not say for sure it is a go, do not rule out future chapters of the series in the future as the likely scenario would be 150 Million dollar budgeted films with a proper ad campaign behind them.

This stance has been taken as well by other publications such as The Guardian U.K. who has cited an analyst stating that the losses will be closer to $50.00 million and in the end, the film may yet make a profit as well.

I offer this as further food for thought.
They still have worldwide box office income, pay per view, on demand, DVD, streaming agreements, tv rights for the U.S. and abroad, cable and dish rights for the U.S. and abroad to factor in as well as other revenue factors. Let us not forget that “Tron Legacy” was seen as a high priced failure for Disney yet thanks to DVD and foreign sales and additional revenue streams a third film in the series is being planned.

Yes, Tron does not have the early losses that “John Carter” has but Disney sees this as a marathon not a sprint and believe that the film will in time return the money that was invested in it.

Disney is far and away the most fiscally conservative company out there. The film lost money short term, but the long term revenue from the film will in time turn a profit.

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