Universal has dethroned Disney as the animation champion
Disney's animated films have struggled in theaters since the pandemic, while Universal's have thrived.
For decades, the Disney brand meant a certain expectation of animation success, from Golden Age classics to the “renaissance” of the ‘90s to the modern Pixar and “Frozen” era. In 2019, both “Frozen 2” and “Toy Story 4” earned over $1 billion at the global box office. But times have changed.
Since the pandemic, Disney’s animated theatrical output has struggled. Of course, it debuted three Pixar films — “Soul,” “Luca,” and “Turning Red” — straight to Disney+ (it recently released them in theaters to little fanfare). But what should have been Pixar’s grand return to cinemas, “Lightyear,” fizzled when it was released in summer 2022 with $226 million worldwide, including $118 million in the US. It was a disappointing showing for a movie that cost $200 million to produce (!?!), especially one adjacent to the “Toy Story” franchise.
Other recent Disney animated movies underwhelmed too: “Strange World” earned just $74 million globally and “Wish” took in $248 million. The one bright spot has been Pixar’s “Elemental,” which earned nearly $500 million worldwide — but still far from what we have expected a Pixar or Disney animated film to gross.
Coming out of the pandemic, there’s been a clear winner in the animation contest. Universal, which was the No. 1 studio at the box office in 2023 (ending Disney’s nearly decade-long run, 2020 notwithstanding), has thrived with its DreamWorks and Illumination titles. Last weekend, DreamWorks’ “Kung-Fu Panda 4” opened to nearly $60 million in the US. Meanwhile, Illumination’s “Migration,” still in theaters after three months, has quietly made over $125 million domestically (and over $280 million total worldwide). Last year, Illumination’s “Super Mario Bros. Movie” was the No. 2 release of the year, behind “Barbie,” with over $1 billion globally.
From 2020 to now, Universal’s animated films have earned a total of $4.5 billion worldwide, including $1.8 billion domestically, according to Comscore data. Disney’s have grossed $1.8 billion total worldwide, $644 million domestically. Universal released 13 animated movies in that time while Disney released 11 (that includes two titles from 20th Century, which Disney owns, and the three Pixar movies that were originally released on Disney+ and only recently received limited theatrical releases).
“Universal has such a diverse portfolio of films,” Paul Dergarabedian, Comscore’s senior media analyst, told me, noting the wide breadth of dramas (“Oppenheimer”), horror (deals with Jason Blum and Jordan Peele), and animation (DreamWorks and Illumination) in its arsenal. It releases more movies than its competitors of all shapes and sizes, and that could be said of just its animated titles.
Universal’s box office from animation has simply dwarfed rival studios, according to the Comscore data. It’s thanks to a steady output of reliable franchises like “Minions,” the most recent movie of which grossed $943 million worldwide in 2022; unexpected hit sequels like “Sing 2” ($422 million globally) and “Puss In Boots: The Last Wish” ($485 million); and under-the-radar originals like the aforementioned “Migration.”
The dominance could continue this year. “Kung-Fu Panda 4” is already a hit and “Despicable Me 4” arrives this summer. Industry observers I follow expect it to be one of, if not the, biggest movie of the year, which would be quite an achievement following last year’s Mario mania (The third movie earned over $1 billion in 2017).
As for Disney, it’s recalibrating. On deck for Pixar this summer is “Inside Out 2,” which would feel like a desperate cash grab if it wasn’t announced in 2022 (but even then was after “Lightyear” had already flopped). It’s also set to release “Moana 2,” which definitely feels like a desperate cash grab considering it was originally conceived as a TV series and then hastily announced in February as a movie to be released this November — reportedly before Dwayne Johnson had even finalized a deal to return.
Since his return as Disney CEO, Bob Iger hasn’t been shy about the issues facing the company’s content, saying in November: “In assessing some of our performance, recently, one of the reasons I believe it’s fallen off a bit is that we were making too much. I think when it comes to creativity, quality is critical, of course, and quantity in many ways can destroy quality.”
That’s part of it, especially when it comes to Marvel, which has been making dozens of shows and movies over the last few years (on orders from pre-pandemic Iger!). But I think there’s something more happening with Disney’s animated films. In an era of bad-faith culture war Fox News gibberish, It’s easy to blame the diminishing box office returns partly on conservative-leaning audiences turning their nose up to perceived “wokeness” (even if Disney does the bare minimum). Even Iger has seemed to acknowledge that, saying at last year’s DealBook Summit: “Creators lost sight of what their No. 1 objective needed to be. We have to entertain first. It’s not about messages.”
But more so, Disney’s streaming ambitions may have tainted its theatrical success: “Disney may have gotten a little hurt by confusion among consumers,” Dergarabedian said. How long is the movie in theaters? Is it also streaming? Do I have to pay extra on Disney+? The decisions of the pandemic may have raised a lot of questions.
Not to mention going to the movies is expensive for families; if a household is already paying $13 a month for Disney+, why would they pay that much per ticket at a movie theater, on top of costly concessions, when they could just wait a month or two for the movie to be streaming? Just look at the numbers: “Encanto,” which was released exclusively to theaters in November 2021 and arrived on Disney+ that December, was the most-streamed movie in the US in 2022, according to Nielsen.
Comparatively, Peacock, Universal’s streaming counterpart, doesn’t have the reach that Disney+ does and “doesn’t pollute the message for its theatrical films,” Dergarabedian said. Universal has been much more selective, and smart, about its streaming strategy in that regard: for starters, it has an animation deal with Netflix in which its animated films stream on that platform after a four-month Peacock window. That seems to be working, as the Mario movie, “Sing 2,” and “Minions: The Rise of Gru” were among Nielsen’s most-streamed movies last year without hurting the box office. And while some Universal titles have streamed on Peacock at the same time as playing in theaters, like “Halloween Ends,” the studio has prioritized premium video-on-demand ahead of a streaming release.
That strategy generated over $1 billion from digital rentals and purchases in less than three years, The New York Times reported last year. And the movie that set it all in motion? The animated “Trolls World Tour” in April 2020, as the pandemic began. I remember writing about the hysteria in Hollywood over that decision at the time; now Universal has cracked the code for generating revenue that doesn’t impact theatrical ticket sales.
“Universal has really figured this out,” Dergarabedian said.