Disney is About to Have a 'Despicable' Weekend

More than one year after
John Carter
left
DisneyDIS
with a multi-million-dollar black eye, critics are expecting the studio to suffer another major loss with the release of
The Lone Ranger
.
Unlike
The Pirates of the Caribbean
series, which was inspired by an amusement park ride and had no big screen predecessors,
The Lone Ranger
is a remake of a 1930s film and radio series. Famous for shouting, "Hi-Yo, Silver!" while riding his horse,
The Lone Ranger
was created long before
Star Wars
,
The Avengers
,
Titanic
,
Jurassic Park
or any other modern blockbuster. It was also created before television series became more cinematic -- and earned more critical acclaim.
Related:John Carter Stole $200M from Disney's Wallet
Nonetheless, Disney was determined to bring
The Lone Ranger
back to the big screen. That decision, however inspired as it may have been when it was first tossed around the boardroom, is expected to haunt the studio for many months to come. When
John Carter
flopped in 2012, Disney had
The Avengers
to make up for the loss. Between the ticket sales, merchandise, DVD sales, Marvel video games and other related revenue,
The Avengers
proved to be just what Disney needed to overcome a major box office flop. But while it may have been easy for moviegoers to forget, Disney still risked a ton of money producing
John Carter
, which only made
$73 million
domestically on a budget of $250 million. Worldwide, John Carter made $282 million -- $32 more than its budget. That might sound like Disney turned a profit, but Albert Fried & Company's Rich Tullo said that movie theaters can take as much as 40 percent of gross ticket sales. At that rate, John Carter only earned $169 million ($282 x 40 percent = $112.8 million, leaving roughly $169 for Disney). "
Great Gatsby
cost [$105] to produce," Tull
told Benzinga
. "Generating [$280 million] at the box office is not a profitable gain for them. Movie theaters take about 40 percent of that." If Disney negotiated a better deal and only allowed movie theaters to take 10 percent of ticket sales (the same deal the
Star Wars
prequels were rumored to have received),
John Carter
would have only made $4 million ($282 x 10 percent = $28.2, leaving roughly $254 million for Disney). Unfortunately, Disney spent a couple million to advertise
John Carter
during the Super Bowl, and millions more to continue promoting the film after that. Disney's next anticipated flop,
The Lone Ranger
, should perform a bit better. According to a
Bloomberg
article entitled, "Disney Rides Into Box-Office Ambush with Depp's 'Lone Ranger,'" the film cost $225 to produce. Based on the early clips from the film, it appears that
The Lone Ranger
has fewer special effects scenes than
The Avengers
or
Man of Steel
, both of which had budgets in the $250 million range. Without a massive display of CG (computer-generated) beauty, it is hard to fathom how
The Lone Ranger
could have cost $225 million. Part of the expense could be attributed to the Hollywood talent. Disney reportedly paid Robert Downey Jr. a whopping
$50 million
to star in
The Avengers
. As the star of not one but
two
separate Disney franchises, Depp could be worth even more. The same could be said for director Gore Verbinski, who helmed the original
Pirates
trilogy for Disney, along with
The Ring
and a number of other films. His
Lone Ranger
paycheck was likely massive.
BoxOffice.com
estimates that
The Lone Ranger
will earn $35 million this weekend (Friday-Saturday). It should make a bit more with Wednesday and Thursday factored in, and is expected to earn $135 million by the end of its domestic run. That's better than
John Carter
, but it could still be low enough to leave Disney with a deficit -- especially if the movie flops overseas. To make matters worse,
The Lone Ranger
opens against
Despicable Me 2
, which is expected to be
one of the biggest films of the summer
.
Louis Bedigian is the Senior Tech Analyst and Features Writer of Benzinga. You can reach him at 248-636-1322 or louis(at)benzingapro(dot)com. Follow him @LouisBedigianBZ
Loading...
Loading...
DIS Logo
DISThe Walt Disney Co
$124.000.83%

Stock Score Locked: Want to See it?

Benzinga Rankings give you vital metrics on any stock – anytime.

Reveal Full Score
Edge Rankings
Momentum
76.41
Growth
91.44
Quality
Not Available
Value
52.26
Price Trend
Short
Medium
Long
Market News and Data brought to you by Benzinga APIs

Comments
Loading...