Barbenheimer rescues the box office
The business news that matters
Hello and welcome to Off to Lunch…
Barbie v Oppenheimer had been dubbed as the box-office battle of the year. It was two high-profile but very different films packed with A-list stars and released on the same day. But it turns out that everyone was a winner from the battle nicknamed Barbenheimer.
Barbie and Oppenheimer were released in cinemas on Friday and the early figures show that they performed better than expected, delivering the best weekend for cinemas since the Covid-19 crisis began. This is a much-needed boost for cinemas that have seen a string of high-profile films flop at the box office this year (including The Flash, Elemental and even Indiana Jones 5) and struggled as consumers cut back on spending and Hollywood studios put more attention on their streaming services.
Barbie, a comedy based on the famous doll starring Margot Robbie and Ryan Gosling, generated $155 million (£121 million) in ticket sales in North America and $182 million in the rest of the world, according to data from Comscore. Oppenheimer, the story of how J Robert Oppenheimer developed the first atomic bomb, recorded $80.5 million in North America and $93.7 million outside.
In the US this was the fourth-best weekend ever for cinemas, according to Comscore. All the other weekends in the top 10 of all-time include either a Marvel, Star Wars or Jurassic Park film. Barbie’s opening weekend is the fourth-best ever, the best of the year and the best-ever for a film directed by a woman (Greta Gerwig directed the film). You can find the list of the biggest opening weekends for films before Barbenheimer here. Avengers: Endgame is number one.
In the UK it was the biggest weekend for cinemas since Avengers: Endgame in 2019, with nearly £30 million spent at the box office. This is good news for cinemas but also the businesses that benefit from people visiting their local cinema, such as nearby bars and restaurants…
Vue International, one of the largest cinema operators in the UK, said that a fifth of its customers had bought tickets to see both films back-to-back. More than 2 million people saw Barbie at Vue cinemas and 4,000 separate screenings of Barbie and Oppenheimer were sold-out.
Tim Richards, the founder and chief executive of Vue, told BBC Radio 4’s Today programme that it had been an “absolutely extraordinary weekend”. This represents a stark contrast to the “apocalyptic” situation that Richards says the cinema industry was in when Covid-19 forced operators to close their sites (you can read his interview on that here).
Revenues for cinema tickets are up 12 per cent in 2023 compared to last year but are still down by more than a fifth on pre-Covid levels, according to a story by The Wall Street Journal here. So this weekend is a big moment. Richards added:
“What this last weekend proved is that our customers never left us after the pandemic, it's been a supply issue and we need movies.”
One last point on Barbenheimer, I recommend checking out the latest Lunch with the FT, which is with Christopher Nolan, the director of Oppenheimer and 11 other films, including Inception, The Prestige (maybe my favourite film of all-time) and the Dark Knight trilogy of Batman films.
Nolan is fascinating on the business of Hollywood and how studios are grappling with an issue that other industries are also struggling with - how established companies can promote their tech credentials to get higher valuations and whether to focus on growth over profits. In a quote that includes a Succession reference, Nolan said: “The industry has been tying itself into knots, all in the pursuit of what Kendall Roy would refer to as a ‘tech valuation’. He says he can get a tech valuation for what is clearly an analogue idea. That’s what streaming is - it’s just a different button on the remote.” You can read that piece here
Other stories that matter…
1. There is an “unacceptable” lack of diversity in the venture capital industry in the UK, according to a new report by the parliamentary Treasury Select Committee. The industry is “dominated overwhelmingly by white men” and it has not invested enough in businesses outside the south-east of England, the report adds. Around 80 per cent of venture capital investment goes to the “Golden Triangle” of London, Oxford and Cambridge. However, only one in five small and medium-sized businesses in London. Report here and story by The Times here
2. Rishi Sunak and Michael Gove have revealed that the government will focus on building homes in city centres as a way to overcome the property shortage in the UK. “Our plan is to build the right homes where there is the most need and where there is local support, in the heart of Britain’s great cities,” says Sunak. There are plenty of regeneration experts who think this is the right strategy - a way to boost productivity in cities, support struggling high streets and build more homes at the same time. Birmingham, Cambridge, Liverpool and Manchester have been identified as key development opportunities. Guardian story here
3. The UK’s private sector is growing at the slowest rate for six months according to new data out today. The composite Purchasing Managers' Index from S&P Global and CIPS came in at 50.7 for July, down from 52.8 in June. This composite PMI reading reflects the performance of all private sectors in the UK and any reading above 50 represents growth. The July reading was dragged down by slower growth in the services industry - with businesses reporting that consumers and businesses are cutting back discretionary spending due to concerns about interest rates - and a sharp drop in manufacturing output. Report here and Reuters story here. There is also disappointing data out of the eurozone today. The composite PMI reading for the eurozone in July was 48.9, down from 49.9 last month.
4. Shares in Sir Martin Sorrell’s advertising agency S4 Capital have fallen by nearly 20 per cent today after the company warned that its revenue and profits are lower than expected because businesses are cutting their marketing budgets. S4 said it is suffering from “challenging macroeconomic conditions and clients, especially those in the technology sector, remaining cautious and very focussed on the short term.” Statement here
5. Elon Musk says that Twitter is to be rebranded as X and has revealed a new logo…
Podcast…
Our Business Studies podcast is back tomorrow with a new season of episodes. The first new episode will be sent to Off to Lunch subscribers on Tuesday morning and will be available on all podcast platforms.
Business Studies takes a look a second look at business stories from the past and asks: did these stories happen the way we think they did and what can we learn from them today? We look back at these stories by speaking to someone at the heart of what happened. We have interviewed some of the biggest names in business in the podcast and you can find all our previous episodes here
I am looking forward to sharing the new episode with you…
And finally…
Perhaps not having an Ashes test north of Nottingham is a good idea after all - it could be a way to avoid the rain. Australia have retained the Ashes after the fourth test against England ended in a draw, with the final day of play on Sunday abandoned due to rain. I was in Manchester on Friday and was lucky enough to be at Old Trafford for the third day of the test, which England dominated. The crowd was, let’s say, pretty lively by the end. England fans left the ground buzzing with optimism that they might be able to beat Australia and the rain that was forecast to arrive over the weekend. So this is a disheartening way for the Ashes to be decided. As Manchester-born Mike Atherton writes in The Times:
The history books will show a drawn Test — the first in Stokes’s captaincy — Australia still trailing by 61 with five wickets left. They will also show only 30 overs were bowled on the final two days of the game, which, even by Manchester’s standards, is a cruel outcome in high summer in July.
You can read that piece in full here
I also enjoyed a feature over the weekend by The Mill which looked at the myths around the rain in Manchester and what the data actually shows. The conclusion? Manchester is pretty wet - it gets nearly twice as much rain every year as London - but Glasgow and Cardiff are wetter. Piece here
Thanks for reading. If you enjoy Off to Lunch then please share it with others and spread the word. If this newsletter was shared with you then please sign-up below to become a member, get Off to Lunch sent directly to your inbox, and contribute to the work of Off to Lunch
Best
Graham