The movie industry is currently facing a labor dispute involving two major strikes: the Writers Guild of America (WGA) strike and the actors’ strike initiated by SAG-AFTRA. Despite concerns about the potential impact on exhibition, Marcus Corp. CEO Greg Marcus believes that these strikes are not as threatening as the challenges faced during the Covid-19 pandemic. In a recent call with Wall Street analysts, Marcus emphasized that the strikes are not an indication of people’s declining interest in movie theaters or a shift towards streaming. Instead, he categorizes it as a temporary supply chain disruption caused by the ongoing labor dispute.
Understanding the Short-Term Nature of the Dispute
CEO Greg Marcus remains optimistic that the labor dispute will be resolved soon. He compares it to parents quarreling but still having to coexist in the same house. Marcus believes that the strikes will not have a long-term impact on the future of exhibition. He attributes his optimism to the recent success of movies like “Barbie” and “Oppenheimer” and their positive reception in the Midwest market. However, the duration of these strikes will ultimately determine their true impact on the industry.
The WGA strike has reached its 100-day mark, while the actors’ strike began in mid-July. Studios have expressed their desire to reopen negotiations with the WGA, and a meeting has been confirmed for Friday to discuss the ongoing talks. The actors’ strike has had an immediate impact on the entertainment industry, including exhibition. Greg Marcus admits that he is uncertain about the potential effects of renewed WGA talks with the Alliance of Motion Picture and Television Producers (AMPTP) on SAG-AFTRA. He considers it beyond his scope of knowledge.
Marcus Corp. operates both theaters and hotels & resorts. Despite the strikes, its movie theater revenue increased by 5.7% to $137 million in the last quarter. This growth can be attributed to a rise in the average ticket price (up by 14%) and higher concession revenues (increased by over 7%) compared to the previous year. The company achieved a 20% increase in operating income, amounting to $19.8 million.
Mark Gramz, President of Marcus Theatres, expressed satisfaction with the performance of “The Super Mario Bros. Movie,” which faced a challenging comparison to the previous year’s blockbuster “Top Gun: Maverick.” He also mentioned the positive reception of “Barbenheimer,” emphasizing the success of quality mid-sized wide-release films across various genres. Marcus Theatres introduced a new promotion called Value Tuesday, offering $6 tickets for loyalty program members and $7 for non-members. This initiative, along with the Magical Movie Rewards program, which includes a 20% concession discount, contributed to increased sales.
Looking ahead, Marcus Theatres has a lineup of highly anticipated films for the rest of 2023. These include “Blue Beetle,” “Gran Turismo,” “Teenage Mutant Ninja Turtles: Mutant Mayhem,” “Strays,” “The Meg 2: The Trench,” “The Equalizer 3,” “The Nun II,” “The Expendables 4,” “Paw Patrol: The Mighty Movie,” “Killers of the Flower Moon,” “Dune: Part Two,” “Trolls Band Together,” “Hunger Games: The Ballad of Songbirds and Snakes,” “Wish,” “Napoleon,” “Wonka,” “The Color Purple,” and “Aquaman and the Lost Kingdom.”
While the dual Hollywood strikes present a challenge for the movie industry, Greg Marcus remains confident in the resilience of exhibition. He believes that the strikes are a temporary disruption that will be overcome. Marcus Corp. is determined to navigate the storm and continue providing audiences with the cinematic experiences they crave. The resolution of the labor dispute and the success of upcoming films will play a crucial role in shaping the industry’s future.
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