Hollywood’s Franchise Dependence: A Double-Edged Sword

As the film industry navigates a post-pandemic landscape, the reliance on established franchises has become increasingly pronounced. With a lineup filled with familiar titles, studios are betting on the strength of intellectual properties (IPs) to draw audiences back to theaters. However, this strategy may not be sufficient to revive box office revenues to pre-pandemic levels.

The Franchise Landscape

The upcoming year is set to feature a plethora of new releases from iconic franchises, including Star Wars, Marvel, DC Comics, Toy Story, Super Mario Bros., Hunger Games, Scream, Minions, Dune, and Jumanji. These franchises have historically played a crucial role in Hollywood’s revenue generation. In 2026, the industry seeks to surpass the $10 billion benchmark in domestic box office sales for the first time since the pandemic, a challenging target given the ongoing shifts in consumer behavior and viewing habits.

Alicia Reese, Senior Vice President of Equity Research at Wedbush, notes that while franchises offer a degree of certainty, they are no longer guaranteed blockbusters. “People are pickier than they used to be. They know what’s coming, and word of mouth carries more weight than ever,” she states.

Franchises and Box Office Trends

Data from Comscore reveals that since 2010, the majority of the highest-grossing films in the domestic market have been sequels, prequels, or remakes. The trend has been consistent, with 8 to 10 such films typically making up the top 10 each year, barring the pandemic-affected year of 2020.

Notably, several original films that initially broke into the top 10 have since spawned their own franchises, including Avatar, Frozen, and Inside Out. Paul Dergarabedian, Head of Marketplace Trends at Comscore, emphasizes that studios view audience familiarity with established franchises as a safe bet, leading to a greater likelihood of attendance.

Historically, the top 10 films have represented about 30% of the total domestic box office annually. However, this figure has risen to an average of 44% in the post-pandemic era, indicating an increasing reliance on franchise films to drive box office sales.

The Risks of Overextension

Despite the apparent safety of franchise films, the industry faces challenges when these properties fail to meet audience expectations. Two highly anticipated releases, Wicked: For Good and Avatar: Fire and Ash, underperformed at the box office, raising concerns about the sustainability of franchise-driven strategies.

The first installment of Wicked grossed approximately $475 million domestically, while its sequel fell short at just under $350 million. Critics attributed this decline to a perceived drop in quality between the two films. Similarly, Avatar: Fire and Ash, despite its predecessor’s success, has struggled to maintain consumer interest, garnering approximately $378.5 million domestically.

Reese points out that overextending a franchise can dilute its appeal. The Marvel Cinematic Universe, once a box-office powerhouse, has faced scrutiny for inconsistent quality in its sequels and an oversaturation of content across streaming platforms.

The Changing Landscape of Film Production

The pandemic has significantly altered the film production landscape, with fewer films being produced for theatrical release. In 2024, only 94 films were released in over 2,000 locations, a 20% decrease from 2019. This decline has led studios to increasingly rely on established IPs as safe investments.

Analysts have noted a lack of mid-budget films—typically ranging from $15 million to $90 million—that have traditionally filled the theatrical landscape. Many of these films have shifted to streaming platforms, where they can be produced at lower costs.

As consumer preferences evolve, studios are adapting by “eventizing” film releases, promoting them as must-see experiences in premium formats. This strategy often favors franchise films, which are easier to market due to their built-in fan bases.

Conclusion

While the film industry continues to lean heavily on established franchises, the risks associated with this strategy are becoming increasingly apparent. As audiences become more discerning and the competitive landscape shifts, studios must navigate the delicate balance between familiarity and innovation. The future of Hollywood may depend on its ability to revitalize original content while effectively managing its franchise offerings.