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Paul Dergarabedian, Head of Marketplace Trends for Comscore, joins to discuss Disney earnings, industry leadership shifts and the 2026 box office outlook today.
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00:00The entertainment industry is at a turning point with major leadership changes,
00:04cost-cutting, and a high-stakes summer box office season just ahead of us.
00:08As studios look to recapture momentum, all eyes are on whether big-budget films can bring audiences
00:14back in force or not. Joining us now is Paul Der Garabedian, head of Marketplace Trends for
00:19ComSport. Thank you so much for being here, Paul. Great to be here, Justine. Thank you.
00:24First, let's start with Disney. What stood out to you from their latest earnings report?
00:28Well, you know, they have a new CEO, Josh DeAmaro, and what a great result for Disney.
00:37Revenue jumping 10% to nearly $12 billion. But what was most notable for me was the operating
00:45income for Disney Plus and Hulu surged like 88%. They've really done, you know, they have this
00:53super app flywheel. They are doing a wholesale reach. They're migrating their tiers so that they
00:59reduce churn. So they've kind of done everything right on that level. And then, you know, they just
01:04had Zootopia 2, which earned nearly $2 billion worldwide in movie theaters. They have The Mandalorian
01:11and Grogu coming up on Memorial Weekend, Toy Story 5. And of course, in December, Avengers Doomsday,
01:20which will open against Dune Part 3. So Doomsday, we're calling it.
01:26Doomsday, I love that. That reminds me of the Barbie Oppenheimer days as well.
01:30Exactly. Amazing to think about what's ahead for them. I mean, so many different things this year.
01:36You mentioned Josh DeAmaro. How significant is this leadership transition from Bob Iger to Josh
01:41DeAmaro for the company's future direction? Yeah, I mean, Bob Iger, those are big shoes to fill,
01:47obviously, an iconic leader of the company. And, you know, to start off with this tailwind that they
01:55have right now, that's a great place for Josh DeAmaro to be. I think if you come into a new
02:01role in a
02:02company and you're having to fight headwinds, that can be very daunting and actually can cloud how people
02:08feel about you, even though you may not have had anything directly or you may have to do with that
02:13status or where they are right now. But in Disney's case, in this case, they're like on a roll. And
02:19I think
02:20we're going to see this continue. Again, that Disney, the streaming component, the way they've
02:26kind of cracked the code on how to put all that together to keep people from leaving the streaming
02:32service, whether it be Disney Plus or Hulu. Obviously, they have ESPN. I think they're pretty
02:37bullish on that as well, as indicated on the earnings call. So to me, they're in a really good
02:42position. And beyond that, and I talk a lot about movie theaters, and we've had a great year at the
02:48box office so far. We're up 14% year to date. Domestically, some big movies that have just come
02:54out, Project Hail Mary being one of them, Michael, and now The Devil Wears Prada 2. Some big, big movies
03:01on the way. This could be one of the biggest summers in the post-pandemic era for movie theaters.
03:07Yeah, there really are so many films coming out right now that all have so much buzz around
03:12them. You mentioned The Devil Wears Prada 2. I mean, so much buzz, so much PR, so much press,
03:17big openings around the world. So we'll definitely have to wait and see what happens with all of that.
03:22But with all of these films, especially the ones you mentioned that Disney is putting out later this
03:26year and some of the other really positive numbers that we've been seeing from them, they've also
03:30announced layoffs. So what does that signal about the broader state of the media industry right now,
03:35thinking about some of these good things that are happening, but then also these layoffs?
03:38Well, that's the irony, right? You think, oh, if things are booming and things are so great,
03:42why are there layoffs? And it's really unfortunate for all of those who are impacted by that.
03:47I think it's just trying to reconfigure their businesses to make them profitable,
03:52have a strong ROI moving forward. Sometimes to do that, you have to reorganize your operation
03:58and your management teams. And it's happening a lot. And obviously, with the potential
04:04Paramount Warner Brothers merger, which was approved by the Warner shareholders,
04:08it's not a done deal yet. But that's also causing a lot of, a little bit of, I don't know,
04:15people are a little averse to that. I think if you talk to Cinema United or theater owners,
04:20they just want to make sure that with this Paramount, potential Paramount Warner's merger,
04:24that there's plenty of films in the pipeline. David Ellison, I was at CinemaCon a few weeks ago,
04:29he went on stage, committed to theatrical, 30 films a year. I'd say that's a tall order,
04:35both in terms of marketing spend and also just the production budgets of that. So to be profitable,
04:43have people going to the movie theaters, that's really important. And this summer, again, could be
04:49at around $4 billion, which we haven't seen, well, in the pre-pandemic era, that was the standard,
04:55was $4 billion domestically for the summer movie season. We only saw that once in the post-pandemic
05:02era, going back to the Barbenheimer year of 2023. We eclipsed the $4 billion mark. But I mean, with
05:07films like Minions and Monsters, Toy Story 5, Pixar, Disney, and of course, for us movie buffs,
05:15having a new Christopher Nolan movie in July with the Odyssey, and of course, Spielberg's Disclosure Day.
05:21Come on. That's like, I'm in, you know, count me in. And IMAX and Dolby Vision, all those premium
05:27formats are going to really see a great summer because people don't mind paying that upcharge
05:33for those premium experiences in the movie theater. Yeah, I have to say. For the right movie.
05:39For the right movie. Well, of course. And I think something like the Odyssey, which I'm excited to
05:42see, you're right, is something that really does feel like it has to be seen on a big screen,
05:47especially in IMAX, especially at the movie theater and not at home on your couch. You know,
05:52we've talked about some of these movies that are coming out this summer and the rest of the year.
05:55Are people really going to go back to the theaters, do you think, in full swing? Or do you think
06:00there
06:00is still some of that streaming that's lingering and keeping people at home? I don't know. I look
06:06at it a little differently. I've always said that I think streaming is complementary and additive to
06:12movie theaters. If you have the goods in a movie theater, like with Michael, that opened
06:16much bigger than expected. Project Hail Mary week after week, showing very minimal second,
06:23third and fourth weekend drops. And then to have Michael again doing so well around the world.
06:29And let's keep in mind that the Devil Wears Prada too earned much more internationally
06:34than in the domestic, you know, U.S. and Canada market. So the global success of movie theaters is
06:40key. It's a global business. I think we're going to see that continue. I think people want to go,
06:45oh, but here's the thing that streaming does. It allows us to say, wait, is this movie being
06:51marketed well enough or does it excite me enough, the content of it, to get me off my couch to
06:56go
06:56to the movie theater? That really is the key. If you can do that, there is no competition for the
07:02movie theater if you think about it in that way, that it is a very unique experience. And for a
07:07movie
07:07like Michael, where the music, I'm a big sound guy. I don't know, I have a voltmeter behind me
07:12somewhere. But anyway, I'm really into audio. And for me, a movie like Michael and Project Hail Mary,
07:20the sound design is very important in these films. But with Michael, most people don't have that kind
07:25of sound system in their homes as they have in these great movie theaters. So that's another big
07:30part of that as well. It's not just the big screen. It's the big sound as well.
07:36That's true. I don't think about the audio as much, but you're right. It's just as important
07:40of a part of the experience as the video or the visual part is. Now, when you think about all
07:44of
07:45these movies, you've been mentioning so many incredible hits that are going to be coming out
07:48that we know from past success that the other toy stories and other films like that are going to be
07:54drawing people to the theaters. How important is the summer box office in general for the overall
07:59health of the film industry this year? And again, in other years, how much does this,
08:04just the summer component of all of this really matter for the industry?
08:08Well, Justine, that's the key question. And okay, so the summer movie season runs 18 weeks from the
08:15first Friday of May. You start Memorial weekend, but if you get more weeks in there, you get bigger
08:19box office. So the summer movie season runs from the first Friday in May through Labor Day Monday.
08:25It accounts on average for close to 40%. That's 18 weeks of box office accounting for nearly 40%
08:34of the total year box office. So as goes the summer goes the year. Of course, the holiday season is
08:40very, very vitally important, but pound for pound, they're both equal in terms of their drawing power.
08:47But the summer movie season, look, if we can get to that 4 billion threshold, that says a lot about
08:54how
08:54the year will go. And 27, I think could be even bigger, but I don't want to get over my
08:59skis,
08:59get ahead of myself. But 27 looks like an even bigger year for movie theaters.
09:04Wow. I can't even imagine what's going to be happening in 27 if we're already seeing all of
09:08this in 26. That's an incredible figure though. 40% just during those 18 weeks is incredible to
09:15think about. Do you think that studios are changing how they release or market films to today's audience?
09:20Again, trying to encourage people to get off the couch and stop streaming and get into the theater.
09:25Has that marketing really changed?
09:27I think it really stays the same, but you have to have the movie and you have to have the
09:32marketing
09:32that really presents what the movie is going to be about. But I look at Ryan Gosling with Project
09:37Hail Mary. He was literally everywhere. He hosted Saturday Night Live. So when you have a really appealing
09:43star like that and they're out there, look at Jack Black. He's become like the biggest
09:47movie star in the world with all these massive movie franchises that he's been in.
09:52So it comes down often to stars, even though we think that's a product of a bygone era having movie
09:58stars. But it really is important. The greatest influencer on me is like a Christopher Nolan or
10:06Steven Spielberg or in front of the camera, a Ryan Gosling saying or Jack Black getting me pumped up to
10:13go
10:13to the movie theater. But I think it's they're still trying to crack the code on that. Sometimes
10:17it's such a fickle situation where you think the movie is there. You got everything going for it,
10:23the right stars. And for some reason, some movies just don't perform. So it's a very it's a formula
10:30that is, you know, it's like a perfect recipe, if you will. It's more like baking than cooking,
10:35if you will, because you get one ingredient just off a little bit. It could ruin the whole recipe and
10:40cause it to fail. But I look at how things have gone this year, again, up 14 percent year over
10:45year on the box office. According to our Comscore data, we're looking at a very strong summer season.
10:52June and July this year just look killer. And at the very end of July, July 31st, you have Spider
10:57-Man,
10:57a new Spider-Man movie. And that's going to power a strong August. There's a jackass movie in there,
11:04Supergirl. You know, every studio has a big movie on the way. And there's some smaller movies
11:10too that look really cool, like Power Ballad from Lionsgate. You know, there's those smaller,
11:16more intimate films that look really good that are on the way. Wow. Well, what a lineup. You've
11:22definitely made me want to go out to the theater. Thank you so much for being here. Paul Dergarabide
11:26and head of Marketplace Trends for Comscore. We really appreciate it. Thank you, Justine. Have a good
11:31one. Thank you.
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