Spider-Man: No Way Home (photo courtesy Sony Pictures)
2022 Home Entertainment Revenue Slid Further into the Shadows of Studio Financials
December 27, 2022
Walt Disney Home Entertainment generated $820 million selling digital and physical movies in its fiscal-year 2022 (ended Oct. 1), driven by Doctor Strange in the Multiverse of Madness and animated musical Encanto.
Lionsgate generated $342 million in sales of movies and TV shows across retail channels through six months of its fiscal 2023 (ended Sept. 30).
Paramount saw almost $1.5 billion in third-quarter (ended Sept. 30) revenue from the “licensing and other” of its hit theatrical movies (Top Gun: Maverick, Sonic the Hedgehog 2, Smile, The Lost City and Scream) and TV shows across retail channels, including DVD and Blu-ray Disc.
You won’t see any of the aforementioned studio financial results presented in quarterly press releases or discussed by corporate executives. While the data points represented fiscal declines ranging from 1% to 19% compared with previous-year periods, they still generated more than $2 billion in combined revenue. Yet, all were buried in the corporate parent’s 10Q regulatory filings — underscoring home entertainment’s diminished retail star in relation to streaming video.
Only Sony Pictures Home Entertainment and Universal Pictures Home Entertainment continue to receive topline billing in their respective corporate parent’s financials. Sony reported a 57% increase in home entertainment revenue to $422 million for the six months ended Sept. 30, while Universal saw a 30% uptick in Q3 revenue to $356 million, from $273 million in the prior-year period.
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Indeed, Sony’s Spider-Man: No Way Home and Universal’s Jurassic World Dominion are among the top-selling packaged media releases in 2022.
NBCUniversal CEO Jeff Shell says the digital movie retail space continues to be a fiscal goldmine, driven by proprietary properties Fandango and Vudu. He said the studio’s strategy releasing all theatrical movies with a box office less than $50 million after 17 days into retail channels has been a margin-driving homerun. The company earns a 80% cut on each $19.99 premium VOD transaction compared to a 50% cut for each theatrical ticket sold.
“Eighty percent adds up a lot more quickly than 50% adds up, and we’re still in the theatrical marketing halo,” Shell told a Dec. 5 investor event. “So, that has been a hugely profitable part of the business.”