As Warner Bros Films Like ‘The Suicide Squad’ Hit Box Office Ceiling, Is COVID or HBO Max to Blame?

While “The Suicide Squad” opened below box office expectations this weekend, with a $26.5 million debut in North American theaters, Warner Bros. faces a bigger problem: The studio’s 2021 films have all hit a box office ceiling.

“Godzilla vs. Kong,” the first big tentpole to hit theaters in March as theaters reopened, remains the only 2021 film from Warner Bros. to reacd $100 million in domestic grosses at the box office. “Space Jam: A New Legacy,” which opened to $31 million, fell off sharply after its opening weekend last month and will not reach that mark. Now, “The Suicide Squad,” which fell short of its projected $30 million opening weekend, will also fall short of that milestone after Paramount’s “A Quiet Place — Part II,” Universal’s “F9” and Disney/Marvel’s “Black Widow” all reached it.

“The Suicide Squad” was always going to be a wild card at the box office as an R-rated, $185 million sequel to a DC Comics film that was a financial success but a critical flop. And determining the factors behind its success or failure would mean picking through a variety of factors, some of which are unique to “Squad” and others that have been plaguing all of Warner Bros.’ releases this year.

For one, it’s possible that the spread of the COVID-19 Delta variant may finally be starting to affect the box office after weeks of steady numbers for new releases. Daily new infections in the U.S. last week reached an average of 100,000 for the first time since February, and a survey published last Sunday by NRG showed that the percentage of people polled that were comfortable with returning to theaters dropped from 81% on July 11 to 70% on August 1. Men under 25, a major demo for “The Suicide Squad,” saw comfort levels drop from 88% to 78%, so there’s a chance that the variant hurt turnout.

Then there is HBO Max, which has proven a double-edged sword for theaters. While freshly reopened theaters had Warner Bros. hits like “Godzilla vs. Kong” and “Mortal Kombat” to screen after a year of closures, they had to compete on opening night with stay-at-home fans who were able to screen the films for the cost of their HBO Max subscription.

While the biggest hits of this pandemic-stricken summer have come from other studios, Warner Bros. still has the largest domestic market share at 24%. With $423 million grossed from 12 films, the studio has contributed more to U.S. theatrical revenue than any other studio this year, and that is due in good part to its hybrid release strategy keeping more films on the slate.

But as Exhibitor Relations analyst Jeff Bock noted, the performance of “The Suicide Squad” and other Warner Bros. films compared to the summer’s biggest successes reinforces the belief among many in the movie theater industry that HBO Max is pulling away a big amount of business.

“The Suicide Squad” (Warner Bros.)

“The casual audiences that are so key to blockbuster success aren’t showing up,” Bock said. “Any teens who might see the film with their parents are just going to watch it on Max, and the theaters likely lost potential audiences who were curious but confused as to what this sequel was to streaming. If we see a big drop next week, then it’s clear that the only people who feel like they had to see this in theaters are hardcore DC fans.”

Which leads to a potentially even more troubling problem for Warner Bros.: What if the problem it’s a hybrid release strategy or pandemic instability — but films that lack the inherent four-quadrant appeal the studio and analysts had previously assumed.

While they are very different films, it is easy to find some parallels between “The Suicide Squad” and another Warner film that disappointed at the box office — “In the Heights.” Both films had expansive marketing campaigns that heavily touted their directors and won effusive praise from critics and core audiences, yet didn’t hit the expected numbers. Casual audiences either weren’t interested in seeing a musical or a gory comic book movie or not interested enough to spend the time and money to see it in theaters instead of on HBO Max.

While the DC faithful are certainly much larger contingent than Lin-Manuel Miranda’s following, Bock believes that the original “Suicide Squad” was able to earn a $133 million debut weekend thanks to bankable stars like Will Smith and Jared Leto as Joker. Even in normal conditions, the absence of both stars in James Gunn’s sequel, plus the confusing title, would have hurt the film even in normal conditions, he said.

“Outside of Twitter and comic book fans, how many people understood what this film was?” Bock said. “And Idris Elba, as talented as he is, isn’t a box office draw like Will Smith or Ryan Reynolds in ‘Deadpool.’ There’s no big-name superheroes in this film like Batman or Wonder Woman either and no connection to a larger narrative like ‘Guardians of the Galaxy’ had with Marvel, so there’s just very little for the average moviegoer to latch onto.”

That could mean big trouble for Warner’s next tentpole coming in October, “Dune.” Once again, it’s a film using its director, Denis Villeneuve, as core to the marketing; and it is based on a classic sci-fi novel with a devout cult following but low recognition among casual audiences. And like “The Suicide Squad,” it was shot on a blockbuster budget, though it is produced and financed by Legendary.

Warner Bros. is once again expected to put out a huge campaign for “Dune,” including a premiere at the Venice Film Festival possibly with the hopes of building Oscar buzz. But if the only people who show up to see the film in theaters are fans of Frank Herbert’s novel, “Dune” could be another film that slams hard against Warner Bros.’ 2021 box office ceiling.
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