Hollywood has an IP problem: Box office sales are banking on franchise hits that keep falling flat

by | Jan 30, 2026 | Business

In this articleCMCSADISWBDFollow your favorite stocksCREATE FREE ACCOUNTMoviegoers will find a wealth of familiar franchises on the big screen this year. It may not be enough to save the box office. New entrants from popular film series dominate the movie slate in the next 12 months. The 2026 schedule features releases from Star Wars, Marvel, DC Comics, Toy Story, Super Mario Bros., Hunger Games, Scream, Scary Movie, Minions, Dune and Jumanji. Intellectual property like these established franchises has long been an important part of Hollywood, but they are increasingly vital in 2026 as the theatrical industry seeks to break the $10 billion mark at the domestic box office for the first time since the pandemic.But some big-name installments aren’t drawing the crowds they used to, and industry insiders worry the $10 billion benchmark may be beyond reach this year for a post-pandemic industry that has been rocked by production shutdowns, the consolidation of major studios and a shift in consumer viewing toward streaming.”The reliance on franchises has been a little trickier the last few years,” said Alicia Reese, senior vice president of equity research for Wedbush. “Yes, there’s a level of certainty … but it’s not a home run. It’s never going to be a home run from here on out, because people are pickier than they used to be. They know what’s coming. Word of mouth means more than ever.”Since 2010, the top 10 highest-grossing films domestically have predominantly been franchise films, according to data from Comscore. During that time, between eight and 10 of the films released each year were a sequel, prequel or remake. The only outlier was 2020, when seven of the top 10 films were franchise-based, due to the number of films that were delayed during Covid shutdowns.And, of course, a number of the original titles that broke into the top 10 have become franchises themselves in the last two decades. Look at “Avatar,” “Frozen,” “Zootopia,” “Inside Out,” “Secret Life of Pets” and “Ted.””Studios clearly feel that audience comfortability — with going to see a movie where they already, in some sense, know what they’re getting before they walk into the auditorium — is a bet worth making,” said Paul Dergarabedian, head of marketplace trends at Comscore.As studios lean into the safety of a built-in audience, box office sales become more reliant on the success of these franchise films. Prior to the pandemic, during the span of 2010 to 2019, top 10 films represented an average of 30% of the total domestic box office annually. Outpacing the group was the 2019 calendar where these films accounted for nearly 40% of the annual haul. All 10 films that year were IP-driven, and nine of them generated more than $1 billion globally. Post-pandemic, the average percentage that the top 10 films represent of the total annual domestic box office is 44%.[embedded content]”I remember having this conversation the late ’90s,” said Eric Handler, managing director and senior research analyst at Roth Capital Partners. “The box office has for the last several decades been franchise-driven. That’s just the way it is. Why? It’s because when there’s familiarity with content, there’s a greater chance that people will show up because there’s an affinity towards a particular franchise and it’s already known.”Now, Hollywood is facing the harsh reality …

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