The long awaited sequel to James Cameron’s Avatar finally released in theatres this year. Since the sequel is out it has been demolishing every competition that he has. Avatar: The Way of Water opened on a slightly underwhelming but still impressive note of $435 Million, which is less than Marvel’s Doctor Strange in the Multiverse of Madness ($449 Million) and consequently Spider-Man: No Way Home ($587 Million). However unlike both of those films, Avatar has strong legs and coupled with the festive season, the movie has been doing phenomenal business. The film has earned $440.4 Million domestically but what is impressive is that it has earned $956.9 Million in the international markets, making the global come to a massive $1.401 Billion, which places it just below Top Gun: Maverick for the biggest movie of 2022.
Avatar 2 crossed the $1 Billion threshold in only 12 days. The film is doing phenomenal business in regions like India where it has grossed more than $41 Million. The Chinese box office is suffering but the sequel has still managed to collect more than $152 Million. While you might think that this is great, you might want to factor in that it is the sequel to the biggest movie of all time, which means the expectations from it are unrealistically high moreover, the budget for Avatar: The Way of Water is around $460 Million which makes it the costliest film ever to be produced in Hollywood. Cameron has mentioned countless times that he’d only make the rest of the Avatar sequels if The Way of Water makes money and by that he meant that the sequel should at least gross $2 Billion.
Which means that despite doing so well at the box office, the film is not a hit or even profitable. Let’s see why?
Why is Avatar: The Way of Water is still not Profitable?
So, I’ll just explain the basic maths of the box office. Basically whatever the film’s earnings are half of it or more is taken by the theatre owner. To simplify it, when you buy a 20 Dollars ticket for a movie 10 Dollars are taken by the producer and 10 Dollars go to the theatre person. This is the basic deal, it can get much more complicated than this and it all depends on the negotiation between the distributor/producer and the exhibitor (theatre owner). But if we apply this basic principle to Avatar: The Way of Water, the movie is losing money till now.
The budget of the movie as I mentioned above is $460 Million and the film has earned $1.4 Billion. Split the earnings in half. Which is somewhere around 700 Million. You might say that this means the film is making money but the reported budget doesn’t account for marketing costs which trust me can be insanely high. A usual big movie easily spends $100 Million in marketing but we can all agree that Avatar 2 would’ve have definitely spend more.
Now, I don’t have the exact figures but as he’d said above for the sequel to break even it has to earn more than $2 Billion. Which suggests that the entire budget of the sequel comes somewhere around $1 Billion, considering the share of the exhibitor. This figure supports Cameron’s previous comments about the finances of the sequel. The legendary director claimed to Variety about the sequel that is “very f***ing expensive” and represents “the worst business case in movie history.”
Avatar: The Way of Water represents a historic box office event as the film is already the 14th highest grossing film of all time. The sequel will soon surpass Furious 7’s $1.5B to enter the top ten and cross its profitability window in the coming weeks. Considering everything the sequel will definitely cross $2 Billion as it has no competition till February 17th 2023 when Marvel’s Ant-Man and the Wasp: Quantumania will come out. The Way of Water has an uninterrupted run at the box office that doesn’t necessarily mean that this is good for Disney.
This extended gap will allow The Way of Water to continue succeeding through most of the month but does come with further costs. Not only does this above-average run mean that Disney will be prominently marketing The Way of Water for far longer, but theaters also take a larger revenue share of these leggier releases. Obviously, this detracts further money from the studio and leaves the movie needing to gross more than usual to turn a profit. So, despite all this money, is Avatar 2 a financial success still remains a question.
Watch the Official Trailer For Avatar 2: The Way of Water on YouTube:
Avatar: The Way of Water is currently playing in theatres near you and is reportedly start streaming on Disney+ from March 17th 2023.
If you have any questions regarding Avatar: The Way of Water, feel free to ask in the comments below. For more content, stay tuned. As usual, like, subscribe and share our articles as we here are trying to build a community of people High on Cinema!
