In a surprising turn of events for a Disney tentpole, particularly a live-action adaptation of a beloved animated musical, The Little Mermaid seems to be relying more on domestic box office earnings than its international performance. The film is projected to gross $300M-$350M in the U.S./Canada market compared to $260M overseas.
According to finance sources, these numbers suggest that The Little Mermaid has a chance to break even. With a reported production cost of $250M and a global marketing spend of $140M, the film has a slim margin for profit. However, if the global box office falls short of the low $400M threshold, the movie could end up with a loss of approximately $20M.
The Little Mermaid’s performance as “not a huge disappointment, but a disappointment nonetheless,” considering Disney’s typically blockbuster streak. The studio’s summer slate is currently in a precarious position, as its two major titles, Indiana Jones and the Dial of Destiny (49% Rotten Tomatoes) and Pixar’s Elemental (58% Rotten Tomatoes, $40M projected U.S. opening), received lackluster reviews after premiering at Cannes.
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The underperformance of The Little Mermaid at the box office becomes more pronounced when compared to the high watermark set by Disney’s previous Memorial Day live-action adaptation of an animated film, Aladdin, in 2019. The Will Smith-led film surpassed $1.05 billion worldwide, with 66% of that gross coming from international markets, including an impressive $53.4M from China.
In contrast, The Little Mermaid struggled in China, starting with only $2.5M. Given the quick decline of U.S. films in the Chinese market, some analysts doubt that the musical, directed by Rob Marshall, will even reach double-digit grosses there.
If The Little Mermaid manages to break even, it would be a rare achievement for a tentpole film, primarily relying on domestic box office revenue. Typically, tentpole movies generate 60% or more of their global box office earnings from international markets. Disney titles that achieve a 50/50 split between domestic and international box office, such as Christopher Robin (2018) and Pete’s Dragon (2016), are the exception rather than the rule.
Despite a strong start in the United States with $118.8M over the 4-day Memorial Day holiday (surpassing Aladdin’s $116.8M) and a running total of $130.2M as of yesterday, The Little Mermaid’s slow performance can be attributed to backlash and review-bombing in certain offshore markets such as Korea, China, France, and Germany.
The controversy surrounding the casting of Halle Bailey in the lead role contributed to the film’s negative reception. However, box office sources remain hopeful, pointing to the movie’s opening in Japan and positive results in Mexico ($8.5M), the UK ($6.3M), Italy ($4.7M), Brazil ($4M), and Australia ($4M). These markets are expected to contribute to The Little Mermaid’s overseas tally, pushing it closer to $260M.
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In a best-case scenario, with a global box office of $560M, The Little Mermaid would break even, resulting in a net profit of $71M before accounting for participations and residuals. The film’s revenue breakdown includes $267M in global theatrical film rentals, $100M in net domestic pay/free TV, $100M from Disney+ streaming rights, $100M in U.S. home entertainment (DVD, digital), and $80M in international home entertainment.