Hollywood Has a Blockbuster Budget Problem | Analysis

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COVID costs, inflation and streamers set new normals for production costs that have led to a slew of overpriced tentpoles

Hollywood blockbusters are burning more cash than ever. (Christopher T. Smith/TheWrap)

Moving forward, Disney will try to make fewer, cheaper movies while “focus[ing] on improving the quality of our films,” Bob Iger promised analysts on a recent earnings call. While Iger has made promises to Wall Street about this before, it’s an issue that has raised alarm bells over the course of the summer as a slew of Hollywood tentpoles have failed to become profit-gushing blockbusters, in part due to their exorbitant budgets.

The likes of “Fast X,” “Indiana Jones and the Dial of Destiny,” “The Little Mermaid” and “Transformers: Rise of the Beasts” ended up costing so much above the norm — at least in relation to their likely theatrical revenue — that they may not make money (or produce sequels) even with objectively decent box office.