Disney's loss from the movie Tomorrowland

The movies industry (and especially the one in Hollywood) is one of the most profitable industries and that can be easily spotted by the surprisingly high numbers of income and the numerous office successes that are noticeable all around the world.

However, not every movie is such a big success. Some barely pay the money spent for to be made and others even cost more that they bring to the office. That seems to be the case with the movie Tomorrowland, a movie that will cost Disney some money.

Disney’s is estimated between 120-140 million dollars. And still Disney, the parent company of Lucasfilm, Pixar, Marvel and Walt Disney Animation Studios seems to remain unaffected by that loss.

Tomorrowland is a movie directed by Brad Bird, starring George Clooney and with a particularly high budget.

The movie costed approximately 190 million dollars, but Disney spent an additional amount of 150 million dollars just for the promotion! The main issue that occurred was the target group that Disney went for. Is this a movie more suitable for children, adults, or perhaps it a family movie? One more issue that was added unfortunately was the bad critics that the movie received.

Tomorrowland has brought more than 70 million dollars so far, in the United States and more than 90 million dollars from the international market. And still, the whole amount of the clear income is not expected to go more than 200 million dollars and as a result, the company will lose at least 100 million dollars from the whole production.

Eric Handler, the brokerage analyst of the MKM Partners-Institutional Equity Trading and Research company, stated that there was a misfire with Tomorrowland but there are some many more productions thar currently “running” for Disney. There is the “Inside Out” (June 19th), there is “Ant-Man” (July 17th) and of course there is the “Star Wars” (December 18th). Ultimately, the current year will still have a decent profit.

This whole story proves the size of the company and how easily it can absorb a misfire that costed roughly 120 million dollars. The lesson we can get for the production companies out of Disney’s loss, is that movies with a high budget are not always equally profitable, while movies with smaller production budgets, may bring more money if the right audience is targeted. The story was first revealed by the Hollywood Reporter magazine (the June issue).

As you can probably imagine, this was not Disney’s first failed attempt. And obviously it won’t be the last either (statistically speaking). But the point is that such a gigantic company can easily make up for the loss and still be at the top 5 production companies of the industry. So come to think about it, this loss that the movie Tomorrowland caused, is nothing but a living – and the most recent too – proof of the size and wealth of Disney and other equal companies that manage hundreds of millions of dollars on a daily basis, as if they were 5dollar bills. Intimidating and yet so  exciting!

Published : Oct 9 2015