“The Little Mermaid” by the Numbers: Staggering Losses

 by Ray Keating

Analysis

DisneyBizJournal.com

June 16, 2023

 

When a company can’t control costs, it’s easy to get into trouble. That bit of obvious “Business 101” wisdom seems to regularly go ignored in Hollywood. Let’s consider Disney’s 2023 version of The Little Mermaid as an example.

Three weeks since its release date (May 26, 2023), this film has raked in $425.1 million at the global box office, according to BoxOfficeMojo.com. Nice, right? Well, actually, no.

 

Consider that the production budget on The Little Mermaid was a reported $250 million. Toss in marketing costs, which tend to range between 50 percent and 100 percent of the production costs, and suddenly we’re looking at a break-even scenario, or a loss of some $75 million for Disney.

 

However, it doesn’t end there. It needs to be pointed out that all of the box office gross doesn’t go to Disney. Various industry reports note that studios take in about 55 percent of the domestic box office, and anywhere from 20 percent to 40 percent of foreign ticket sales. 

 

Therefore, Disney’s cut of The Little Mermaid’s $239.4 million domestic gross would be about $132 million, and its take on the $185.7 million international box office would be, at best, $75 million. 

 

That would put Disney’s revenues from The Little Mermaid at a little over $200 million (approximately $207 million), so far. That means that Disney’s losses on The Little Mermaid, at this point, are in the range of $170 million to nearly $300 million. That’s staggering, and it’s not the first Disney big-budget flop over the past year or so.

 

Hollywood has a spending problem, and Disney seems to be one of the leaders in such profligacy.

 

__________

 

Ray Keating is the editor, publisher and economist for DisneyBizJournal.com; and author of the Pastor Stephen Grant thrillers and mysteries, and the Alliance of Saint Michael novels; and assorted nonfiction books. Have Ray Keating speak your group, business, school, church, or organization. Email him at raykeating@keatingreports.com.

 

The views expressed here are his own – after all, no one else should be held responsible for this stuff, right? 

 

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