Disney Stock Tumbles, Some Blame it on “Avatar: The Way of Water” Box Office Performance

Last week, “Avatar: The Way of Water” opened worldwide at the box office. Although it had a respectable showing at the box office, taking in roughly $134 million in domestic markets, Disney had forecasted a $135-$150 million opening weekend. Disney stock [$DIS] has tumbled over $4.00 in today’s trading. Some are blaming the disappointing results from the highly anticipated sequel to “Avatar.”

disney stock avatar way of water

This morning on CNBC’s “Squawk Box,” Tom Rogers, Executive Chairman, of Engine Media said, “While this was a stunning film, I think a 2-year-old with scissors would have edited this down significantly. The film clocks in at 3 hours and 12 minutes.

The host asked if it was a good move to add three more sequels. He then followed it up by saying, “I’m not gonna do it.”

Rogers said he thought the film was “stunning” and that it will do “fine for them” because there is so little holiday competition for a family movie. He added that the film is in China, which is ‘very rare for an American film these days,” but he said this has to be a “teachable moment” for Bob Iger.

He said that although “Avatar: The Way of Water” was visually beautiful, it had a thin plot.

“I would think that Iger, regardless of the Disney hype externally is going to be saying that this is not the kind of money they should be spending.” He said that he thinks Iger would say that Disney should stand for a different quality of storytelling.

Rogers went on to say that ultimately the real test for the sequel will be how it works for the parks and what this does for Disney+ and selling merchandise.

Interestingly, Rogers says that the FOX deal, which Iger also made, is looked upon as not “one of the good deals.” He said that even though Disney “way overpaid” for FOX, Avatar was looked at as the on-brand element of the deal.

In spite of its initial underperforming at the box office, the film has received glowing reviews. On Rotten Tomatoes, it received a 78% critic rating and a whopping 94% audience score.

“Avatar: The Way Water” delivered James Cameron his first $100-million opening weekend as a director.

“The problem is nobody wants to go to the cinema because they’ve been told that Covid is extremely dangerous,” said Tony Chambers, Disney’s global head of theatrical distribution. “Although cinemas are open, the appetite for going to them isn’t really there.”

Yahoo! Finance reports that the “Avatar” sequel carried a reported production budget of $250 million-plus, which Cameron noted makes it “the worst business case in movie history,” and will have to be the third- or fourth highest-grossing film just to break even.

Avatar: The Way of Water from CNBC

Currently, there are plans for three additional sequels to be released at two-year intervals until 2028.

The 2009 film “Avatar” was a blockbuster hit, earning $77 million in its opening weekend and eventually becoming the highest-grossing film of all time with global earnings of nearly $2.9 billion.

Have you seen “Avatar: The Way of Water” yet? If so, let us know what you thought of it in the comments below.

Check out some of our other stories related to “Avatar: The Way of Water” release:

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