The Walt Disney Company’s stock continued its multi-year decline after the much anticipated “Avatar: The Way of Water” failed to hit opening weekend box office projections.
The film brought broke the $100-million mark for its opening — the first time a James Cameron-directed film has ever done that — but at $134 million in domestic box office receipts failed by a significant margin to hit the $170 million expected by industry analysts, Yahoo Finance reported yesterday.
In the wake of that news, Disney’s stock closed down 4.8 percent Monday, at $85.78, its lowest level since March of 2020. The stock has lost 56.5 percent of its value since peaking at just under $200 per share in March 2021.
In early Tuesday trading, Disney showed some signs of recovery, with the stock up about two points over Monday’s close. It had given most of those gains back less than an hour later, but with hours left in the trading day.
Cameron has said that the film would need to break the $2 billion mark eventually to break even, according to CNBC.
Time calculated that the film has to gross just over $2 billion to break even, which is very possible, even with the missed expectations this weekend.
The first “Avatar” film grossed only about $77 million in its opening weekend, but went on to reach the billion-dollar mark in less than three weeks. It set speed records, in fact, for hitting the $1 billion international, $600 million domestic and $2 billion total marks.
“Avatar” is the highest-grossing film of all time, in fact, and even with inflation-adjusted numbers it still ranks second, behind 1939’s “Gone with the Wind.”
Yahoo Finance reported that box office analytics platform EntTelligence expected “The Way of Water” to follow a similar pattern.
“My biggest cautionary tale with this movie has been to play the long game,” Shawn Robbins, chief analyst at Box Office Pro, told Yahoo Finance. “There were some inflated expectations … it’s not a shocker, but it does put a little bit more pressure on the film to live up to the long playability that’s expected of it over the next few weeks.”
Other “Avatar” films are in the works, but how many will ever see the light of day depends, at least in part, on how “The Way of Water” performs over the next two months.
“The market could be telling us we’re done in three months, or we might be semi-done, meaning: ‘OK, let’s complete the story within movie three, and not go on endlessly,’ if it’s just not profitable,” Cameron told Total Film in an interview.
“The stakes couldn’t be higher,” Comscore analyst Paul Dergarabedian told Yahoo Finance.
If the film performs as its predecessor did, Disney and Cameron should be in good shape, despite the temporary stock price drop.
“‘Avatar: The Way of Water’ is an incredible film with an A CinemaScore and great word of mouth, and based on our strong pre-sales through the coming weeks it’s a safe bet that many moviegoers are waiting until the holidays to catch it on the with the best cinematic experience possible — namely, IMAX,” IMAX CEO Richard Gelfond told Yahoo Finance. “James Cameron films have a well-known history of long legs at the global box office, and we anticipate that this one will be no different.”
“The Way of Water” opened Friday. Three more films in the franchise are planned, with released dates every two years through 2028.
CORRECTION, Dec. 21, 2022: The first “Avatar” film set a speed record with its $600 million domestic box office haul. An earlier version of this article included a different number.
This article appeared originally on The Western Journal.