The MCU Flops That Were Over Budget

When Marvel Studios president Kevin Feige addressed the crowd packed into the Colosseum theater at Caesars Palace in Las Vegas during CinemaCon earlier this week he didn’t do so in person. Even though the event is the most important annual gathering of theater owners, Feige only appeared in a video message. There was good reason for this.

Feige explained that he is currently at Pinewood Studios in the United Kingdom on the set of Avengers: Doomsday which is due to debut in May next year. It’s no surprise he is on the ground given how much is at stake for Marvel’s owner, The Walt Disney Company.

Marvel recently announced a line-up of 27 A List actors who will star in the super hero extravaganza headlined by Robert Downey Jr. More are expected to follow giving Doomsday and its sequel Avengers: Secret Wars a bigger cast than the previous record-holders Avengers: Infinity War and Avengers: Endgame. As this report revealed, those movies cost a combined $1.3 billion making Doomsday and Secret Wars quite a gamble, especially as Marvel has had a run of bad luck at the box office in recent years.

The nadir was undoubtedly 2023’s The Marvels as its box office of just $206.1 million gave it the lowest gross of the 35 movies in the inter-connected Marvel Cinematic Universe (MCU).

Talking to CNBC in 2023, Disney’s chief executive Bob Iger suggested that the underwhelming outcome may have been caused by lack of oversight. “The Marvels was shot during Covid,” he explained. “There wasn’t as much supervision on the set, so to speak, where we have executives [that are]

really looking over what’s being done day after day after day.” Marvel could certainly afford them.

Filings from the studio show that it spent a staggering $374 million (£307.8 million) on The Marvels though they stress that “the cost was forecasted to be in line with the production budget.” Other productions weren’t so lucky.

Marvel Studios made a name for itself by grounding its heroes in the real world. Gaudy costumes and secret identities were dispensed with whilst newsreaders and rock songs from the real world were woven into the plots. This approach made the movies a hit with the adults who grew up reading Marvel’s comics. However, the studio also had another super power up its sleeve. Marvel was also prepared to open its wallet to ensure that the end result looked the part. Whether it was casting A List actors or using the leading visual effects firms, Marvel spared no expense, even if it meant blowing its own budgets.

Contrary to popular belief, the budget of a movie isn’t the same as its cost. If this was the case, it wouldn’t possible for a film to be over or under budget. In fact, the budget is the sum that the studio allocates to it on its internal forecasts. The movie’s cost is the amount that is actually spent on it. If this is higher than the budget the studio has to allocate further funds to it in order for production to continue. If a movie goes over budget that doesn’t mean it will be a bust at the box office. Far from it in fact as the list below shows.

Disney’s filings in the United States don’t disclose the cost of individual productions, let alone whether they are over or under budget. Instead, the studio combines the cost of all of them in its overall expenses and doesn’t itemize how much it spent on each one. Like most major movie studios, Disney also doesn’t discuss the cost of individual productions and didn’t provide a comment for this report. However, it is based on data which comes directly from the studio.

So far, 16 of the movies and shows released by Marvel were filmed in the U.K. where studios get up to 25.5% of their spending reimbursed by the government. The key condition is that at least 10% of the total cost of each production must be spent in the U.K. and in order to prove this to the government, studios set up separate companies which file financial statements showing everything from the salaries and social security payments of the staff to the total costs of the production and even whether it was over or under budget. It takes a bit of detective work to get the information.

The companies usually have code names so they don’t raise attention with fans when filing permits to film on location. Tallying the names of each production company with the movie or show they made requires deep industry knowledge which my colleague and I have built up over nearly 15 years. We are the only reporters worldwide who specialize in covering the financial statements of U.K. production companies for national media and we have reported on them for more than 10 leading titles including The Times of London, The Guardian, The Daily Telegraph, The Independent and the London Evening Standard.

The financial statements have a public interest in the U.K. media as the reimbursement to the studios comes from taxpayers’ money. Outside the U.K. the interest is in the bigger picture matter of the production costs. The data shows that 2011’s Captain America: The First Avenger, the first MCU movie made in the U.K., cost $221.4 million (£140.3 million) and was within its budget.

Two years later came the release of the next MCU movie made in the U.K., Thor: The Dark World, and it too was within budget with total costs of $276.5 million (£174.1 million). However, the following year, Marvel debuted Guardians of the Galaxy and although the sci-fi super hero flick only cost $8.6 million more than The Dark World, it was over budget. The movie put Chris Pratt on the Hollywood map and while it’s not certain why it cost more than expected, there is no doubt that it wasn’t a flop.

Thanks to the inspired casting choices as well as skilful writing and direction by one of the movie industry’s brightest talents, James Gunn, Guardians of the Galaxy was a smash hit. According to industry analyst Box Office Mojo, it grossed $773.4 million giving Marvel an estimated $386.7 million of the takings based on the typical 50% split to studios confirmed in research by film industry consultant Stephen Follows. After receiving a $46 million (£29.1 million) reimbursement, the movie was left with a profit of approximately $147.6 million at the box office which convinced Marvel to greenlight two sequels. Both were shot in the U.S. so their costs are shrouded in secrecy.

Before the pandemic, only one other MCU picture was over budget and that was Doctor Strange. The 2016 movie told the origin story of the eponymous Sorcerer Supreme, played by Benedict Cumberbatch, and it too was far from a flop at the box office. It was produced by a Disney subsidiary named Supreme Works Productions, in a nod to Strange’s nickname, and its financial statements show that it cost a total of $252.1 million (£185.2 million). After it banked a $41.2 million (£29.8 million) reimbursement as well as an estimated $338.9 million from Disney’s share of the box office, the movie was left with a $128 million profit at the box office. This is despite its financial statements confirming that the “final cost of the film has exceeded its budgeted cost.”

Infinity War followed in 2018 and came in on budget, along with Endgame, which was made by the same Disney production company. The latter temporarily became the highest-grossing film in history with total takings of $2.8 billion and it appears that it went to Disney’s head. Since then, the studio’s cost containment has nosedived and so too has the gross of its MCU movies.

Over the nine years to 2019, just two out of the eight MCU movies made in the U.K. exceeded their budgets giving Marvel an overspend rate of 25%. However, over the following five years, that increased to 55.6% as five of the nine productions cost more than forecast. So much so indeed that in 2023 Iger said that Disney needed to “reduce costs on everything that we make because, while we’re extremely proud of what’s on the screen, it’s gotten to a point where it’s extraordinarily expensive.”

To his credit, the two U.K.-made MCU movies which have been released since then have both been within their budgets. They are The Marvels and last year’s Deadpool & Wolverine, Disney’s only MCU movie since the pandemic which has grossed more than $1 billion. Although its made $1.3 billion at the box office, it did this on the ticket of being a foul-mouthed violent movie mocking the MCU which has long since strayed from its original principles.

The grounded movies that made the MCU a hit with adults have now been replaced with ones set in parallel worlds inhabited by aliens whilst many of the heroes wear colorful costumes and have secret identities. The star of the latest MCU movie, Captain America: Brave New World, is no exception whilst one of his antagonists is a red version of Marvel’s iconic Hulk character. It hasn’t been a dream ticket for audiences and has grossed $411.4 million which is only 11% more than the first Captain America movie made in 2011.

Marvel’s problems began in 2021 with the release of Black Widow, a gritty spy story starring Scarlett Johansson that might have been a box office success if it had been released before Endgame. There are two reasons for this. Firstly, the Black Widow dies in Endgame so her standalone movie, which is set at an earlier time, lacks tension as viewers already know her fate. Secondly, Endgame didn’t have to contend with the pandemic like the Black Widow movie did.

When it was released in July 2021, Disney took the controversial decision of releasing it simultaneously in theaters and on its Disney+ streaming platform where subscribers could access it for a month at an additional charge of $29.99.

The National Association of Theatre Owners blasted the decision and blamed it for a 67% fall in box office receipts in the movie’s second weekend, making it Marvel’s worst performer in that period. It also infuriated Johansson whose contract gave her a cut of the theater takings which were dented by the simultaneous streaming release. It led to her suing Disney with sources telling The Wall Street Journal that she had lost more than $50 million because of Disney’s release strategy.

She eventually settled with Disney but theaters weren’t so lucky. Black Widow grossed $379.8 million with a 50% share of this failing to cover the $253.4 million (£198.3 million) net cost of the movie. However, it reportedly made Disney more than $125 million in online revenue pushing it well into the black despite being over budget.

In November 2021 Marvel followed it up with Eternals, a movie about an obscure bunch of heroes who wore costumes which looked like they had come straight from the pages of a comic book. It didn’t go down well with audiences and was the first MCU movie to be rated ‘Rotten’ on review aggregator Rotten Tomatoes. It wasn’t just a critical flop but also a commercial one. Even Feige described it as a “risk”, telling The Hollywood Reporter that “it is a very big movie. It is a very expensive movie.” He wasn’t exaggerating.

The Disney subsidiary behind it was called Olympia Productions UK, after the heroes’ home world, and its financial statements confirmed that its “final cost did exceed the production budget.” They show that the company spent a net $270.7 million (£210.9 million) so a 50% share of its $402.1 million theater takings would leave it with a $69.7 million loss at the box office. This doesn’t include revenue from merchandise or corporate alliances, as they are paid directly to the studio. However, it also doesn’t include marketing costs as they are paid by the studio.

The proof that it is possible to go over budget and make a profit at the box office is 2022’s Doctor Strange in the Multiverse of Madness. Like its prequel, it too cost more to make than Marvel expected and ended up with net costs of $370.9 million (£283.2 million). This still left Disney with an estimated profit of $107 million when it was deducted from the studio’s share of the $955.8 million theater takings.

That all changed in 2023. Not only did Disney book a hefty loss at the box office on The Marvels, despite it being within its budget, but, as this report revealed, it also lost money on Ant-Man and the Wasp: Quantumania which was cost more than forecast. With a critics’ score of just 46% on Rotten Tomatoes, it was also certified ‘Rotten’ so was firmly in the flop category.

Then came spy saga Secret Invasion which debuted on Disney+ in June 2023 to the second-lowest audience of any streaming series set in the MCU as just 994,000 viewers watched it in its first five days according to media analysts Samba TV. The worst was yet to come as its final episode scored just 7% on review aggregator Rotten Tomatoes – a record low for an MCU show. Subscribers to Disney+ don’t pay per show so it isn’t possible to calculate whether Secret Invasion made a profit but based on its review ratings it was far from a success.

It is worth noting that the $1.1 billion box office profits from Infinity War and Endgame alone cancel out the losses made by the MCU movies which went over budget. Of course, there is no guarantee that Doomsday and Secret Wars will generate similar results.

Like all major movie studios, Marvel compiles internal forecasts which carefully manage costs in order to ensure that each production makes a profit if it meets its box office projections. Some movies exceed expectations as A Minecraft Movie is currently demonstrating for Warner Bros. Its weekend sales of $157 million blew away the forecasts of $85 million to $100 million from industry tracker Box Office Pro. Assuming that Warner’s internal forecasts were along the same lines it should be easier than it expected to turn a profit on the movie.

Conversely, if movies go over budget, it gets tougher to meet that objective and given that the costs of the two upcoming Avengers films are already likely to be sky high, a substantial increase could bring the curtain down on their chances of making a profit.

Feige will be hoping that with his supervision on set the Avengers will be able to defeat their greatest enemy and finally make Marvel’s overspending a thing of the past.