Breaking Even in Film

It's a generally understood fact in Hollywood, that to make money on a film you have to surpass the budget. Usually, if the worldwide gross is twice the film's budget, it is considered to have broken even, and is typically considered successful, considering the money that will be made on DVD. Why double? Due to marketing costs, and the fact that about 50% of the gross actually goes back to the studios. Considering that, even films considered successful often don't make money until the DVD comes out. I consider breaking even the most important thing for a film to achieve, so I'm going to list the films this summer that have done so, and in future posts I may include more of them...just cuz I wanted to. Note: While production budgets are readily available, marketing costs are usually kept under wraps, so that part will be conjecture on my part. Usually there's one wide release every week that manages to actually make money.

Iron Man 2
Production Budget: $200 million
Domestic Gross: $308 million
Overseas: $303 million
Worldwide: $611 million

Even when marketing is taken into account, you can't deny that this movie made money. Despite a weaker overall performance domestically, this has surpassed the first film worldwide.

Letters to Juliet
Production Budget: $30 million
Domestic Gross: $51 million
Overseas: $8.9 million
Worldwide: $59.9 million

Okay, this technically has not broken even, but it will within a few days, and then some once the overseas market kicks in (it has yet to be released in most markets). This is a good example though of how difficult it is to break even on a film, even with a modest budget. Taking into account marketing costs, this movie probably won't make money till the DVD comes out, but I think the studio was counting on that.

Shrek Forever After
Production Budget: $165 million
Domestic: $233 million
Overseas: $137 million
Worldwide: $370 million

Despite performing far below the other Shrek films, (although it has better legs than Shrek 3) Shrek 4 has managed to more than break even, and is still just getting started on the foreign side of things. With marketing, it still has a ways to go but will probably make it by the time all the foreign markets are tallied.

Sex and the City 2
Production Budget: $100 million
Domestic: $93 million
Overseas: $172 million
Worldwide: $265 million

Another movie that did below expectations domestically, Sex and the City 2 has managed to make money, despite a bloated budget and horrible reviews. The DVD will have to recoup most of the marketing costs, but (sadly) a third film is not entirely out of the equation...blech.

The Karate Kid
Production Budget: $40 million
Domestic: $155 million
Overseas: $24 million
Worldwide: $179 million

A run away success, which I predicted. No matter how much was spent on marketing the studios have made a boatload of cash on this picture, and it will only increase, since it has yet to launch in many major overseas markets, and is still playing strongly here in the US.

Toy Story 3
Production Budget: $200 million
Domestic: $301 million
Overseas: $151 million
Worldwide: $452 million

Who didn't expect this? Even with a $200 million budget to conquer, this is one of the most recent films to make it's money back. It's still playing strongly here, and has yet to launch in many places overseas. When all is said and done on the box office side, this will probably be the highest grossing film of the summer. Almost certainly.

Twilight Saga: Eclipse
Production Budget: $65 million
Domestic: $175 million
Foreign: $100 million
Worldwide: $275 million

After only six days of release, Eclipse is one of the most profitable films of the year, having made more than 4 times its budget back. In the end its profits will be unimaginable, proving that a big budget is almost always a hindrance more than a help. Take notes Hollywood, and you can all make money. (preferably however, have better stories than Twilight, my point is special effects and big names do not box office make)

Why Twilight is Genius

SHOCKING TITLE GET YOUR ATTENTION?

Good, now listen up, this is from a box office perspective, this is why Summit Entertainment studio heads are some of the smartest people alive.

Summit somehow acquired the rights to the enormously (and oddly) popular Twilight franchise for pittance. Since the books require little in the way of a massive budget, and Summit had little cash to spare, they churned out the first film for a mere $37 million. It went on to make $192 million domestically, and $216 million overseas. $408 million worldwide vs. $37 million budget. Dayang.

However, Summit realized the Twilight craze would soon fade, and managed to churn out a sequel in less than a year. Where most studios would double the first film's tiny budget, Summit kept cool, raising the budget only $13 million, to $50 million. New Moon handily broke the all-time opening day record, with $73 million dollars in the till after only 24 hours. It went on to make $297 million domestically and $413 million overseas. $709 million worldwide vs. $50 million budget. Shoot.

At this point even the most conservative studio execs would lose their restraint and green-light a production of $100 million plus. Twilight Saga: Eclipse comes out at the end of June, with a mere $65 million price-tag.

I salute you, Summit. But the real genius perhaps lies in the fact that the Twilight films require little money to make, and bring in the big bucks. Love it or hate it, Twilight is a phenomenon, and it will be gone soon, which is why the fourth film has recently been split into two, to make it last that much longer.