‘The Lone Ranger’ Could Cost Disney Up to $190 million in Losses

Disney to Lose Up to $190

Disney chief Bob Iger says 'We still believe in a tentpole strategy. A tentpole strategy is a good strategy.'

Disney said during its third quarter fiscal earnings call that it expects to lose between $160 million and $190 million from the disappointing performance of “The Lone Ranger.”

The charges will be part of Disney’s fiscal fourth quarter results, which wrap up in September, according to Disney chief financial officer Jay Rasulo.

The Lone Ranger” has earned $176 million ($87 million domestic) so far at the worldwide box office. Film cost more than $215 million to produce.

Rasulo said the studio will likely post an impairment charge of $86 million with the rest to be based on “The Lone Ranger’s” final run at the worldwide box office, due to changes in accounting rules. The Jerry Bruckheimer-produced Western that stars Johnny Depp and Armie Hammer is only open in 40% of international markets, with Japan set to open the film in September.

SEE ALSO: Disney, Jerry Bruckheimer See ‘Lone Ranger’ as New Genre-Bending Superhero

Disney chief Bob Iger was frank on the status of the busy summer season that has left some films — Sony’s “After Earth” and “Smurfs 2,” DreamWorks Animation’s “Turbo,” and Universal’s “R.I.P.D.” struggling for attention.

“The last number of summers have been quite competitive and crowded,” Iger said during the call with analysts. “I don’t think it’s been more crowded or competitive (than previous years) although a lot of attention has been paid to it.”

Iger cited “Iron Man 3” as an example of a film that not only succeeded at the box office this summer but also outperformed the first two installments. With $1.2 billion under its belt, it’s the second highest grossing Marvel film behind “The Avengers,” which earned $1.5 billion.

“We think ‘The Avengers’ helped ‘Iron Man 3,'” Iger said, given the appeal of the superheroes in the film and the resulting box office haul.

“There has been a lot of discussion of the risk of high-cost tenptole films; we certainly can attest to that given ‘The Lone Ranger,'” Iger said. “We still believe in a tentpole strategy. A tentpole strategy is a good strategy,” adding that the “way to rise above the din and the competition is a big film — a big film, a big cast and big marketing behind it.”

Iger added that looking at the studio’s release schedule in the years to come, Pixar, Marvel and the Lucasfilm brands “will help us rise above that din and compete effectively. But you still have to make really strong films. I don’t think the dynamic (of a crowded summer marketplace) has changed all that.”

The executive did admit that it’s become tougher to open films, but also stressed that isn’t new, nor should it surprise the rest of the industry.

“I guess there’s more risk in the marketplace,” Iger said. “We’ve known all about that risk for quite some time.”

When it comes to Marvel films, Iger said the company has only reached “the tip of the iceberg” when it comes to exploiting the comicbook company’s characters as franchises and cited “Guardians of the Galaxy” as a new property that the studio is high on to introduce new characters to moviegoers. But he cautioned that “you can’t go to the well too often,” and over sequelize hits.

“It’s hard to make great films,” he said, and the studio should only greenlight new pics “when you believe in the stories and the storytellers.”

Iger was high on the animation division, propping up the success of Pixar’s “Monsters University,” which Disney expects to earn more than $400 million outside of the United States and become the fourth highest-grossing Pixar film.

“Our animation strategy is clearly working,” he said, also citing the success of “Tangled” and “Wreck-It Ralph.” “Planes,” out this weekend, was initially developed as a direct-to-homevideo release but “we looked at it and saw the quality and decided to bring it out theatrically was a wise move,” Iger said.

Filed Under:

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 13

Leave a Reply

13 Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

  1. leodavinci1 says:

    What does Disney expect from movies like The Lone Ranger and John Carter? Both movies (especially John Carter) had original stories with overwhelming potential.

    The fundamental problem of these (and movies like Man of Steel) is movie makers and writers who don’t know how to (or as likely, don’t want to) make movies with heroic characters that aren’t “damaged goods” (or purveyors or mass destruction… or both), instead of characters that people can look up to and identify with their virtues… rather than their fears and/or flaws. A discouraging movie trend of the past several decades whose permutations can be traced back to the character of Indiana Jones and his fear of snakes.

  2. Jim Ponsoldt says:

    out of curiosity, reading these numbers, what would prevent a studio from hiring “quality/indie” filmmakers, who are accustomed to making films for under five million, with a quality script, and then pour the same amount of money into promotion and distribution that is now spent on each “blockbuster”? (i know, it sounds “irrational” to pay 4-5 mill to make a film and then 60-70 mill to promote and distribute it, but why not?)

    what should disturb many people is that, for example, for the 150 mill spent on a blockbuster, the majority of which this summer have been poor quality losers, a studio could make many, many “indie” style quality flicks. from what i’ve seen, if a studio bought up the five best films from sundance and spent 75 mill per to promote and distribute–say, to 3000 screens each–the studio’s gross would be much better and the risks much lower.

    just a thought. i know many in film promotion have virtual “green light’ authority and claim they could promote almost any reasonably good film. i’d like to give them a real opportunity to promote “quality” films.

  3. Catherbo says:

    If the script is a sow’s ear, even $250 million won’t turn it into a silk purse.

  4. Suzanne says:

    Timing is everything!I think with all the Mega Hits that all came out so closely together it was bound to happen to one movie,also Johnny will rise above it and whatever next move he makes will be great!I’m sure he would make an excellent writer!Not that he won’t make some more great movies but I can see him write and direct some of his own great epics!

  5. wood says:

    “One way to rise above the din and the competition is with a big film, not just big budget, but big story, big cast, big marketing behind it.” True!!! Like! Sanford and Son! THE MOVIE!! Big film! Big film and The right cast…Twitter.com/healingprophet

  6. Following the disappointing JOHN CARTER (a man goes to the planet Mars, which is just like Planet Earth) with a “tentpole strategy” of THE LONE RANGER (wherein the title character is a supporting player) is not faintly a try in making what executives might even call a “great film”; JOHN CARTER over-indulged its director (to say the least) and wildly placated its star (Depp) in THE LONE RANGER.

    And this is why there will be more of the same…then more of the same. Were it not for their MARVEL ENTERTAINMENT holdings and assets, Jay Rasulo would have declined the interview with Variety.

  7. cynic says:

    Disney should have just scrapped Lone Ranger back when it threatened to due to Verbinski’s bloated budget. Execs knew even then that it was going to cost far too much to produce but let themselves be seduced by the fantasy of Pirates-scale booty from another Depp vehicle. They should learn painful lessons from disasters like TLR and John Carter about giving into the whims of directors and stars who want hundreds of millions of dollars for their vanity projects. Every film project entails some risk, but it’s possible to minimize that by not getting blinded by the names on the marquee.

  8. John Y. says:

    I think the Lone Ranger was just comepletely off in tone, pacing, etc. from beginning to end. It also turned me off (as a kid who remembers watching the old Lone Ranger series in syndication on TV back in the 70s…yes, there’s still some of us left…) that they treated the characters & material with so much snarky disrespect where it felt like they were laughing AT rather than WITH the audience. I would have preferred if they made a more straight-up heroic version (even with some humor thrown in) that showed a modicum of respect for the material & audience.

  9. Beverly Hale says:

    Lone. Ranger needed a cohesive story, was too long, and Tonto was another Captain jJack Sparrow…….what were those In charge thinking?

  10. tantrum says:

    IMO, biggest obstacle to success — at least domestically — was you have multiple generations of children who have never played “Cowboys & Indians” as the very notion has been rendered socially unacceptable by a re-aligning of our understanding of American history.

    That was NOT an issue with “pirates” — kids may not have been playing pirates every day per se, but they were (and are now even more so) an ingrained part of childhood play and lore thanks to the Disney canon and numerous children’s books.

  11. No one is paying attention to the STORY. We don’t want just special

  12. James Rusnack says:

    I’m sure over a billion dollars from IRON MAN 3 will alleviate the loss.

  13. Michael says:

    Underperformer?? It’s a MEGA FLOP. Lol!

More Film News from Variety

Loading