How Much Money Did Marvel Phase Three Really Make? (A Note on the Recent Revelations About Avengers 3 and 4)

Not long ago I wrote about the extraordinary profitability reported for Disney's Marvel Cinematic Universe in Phase Three. Much of that profit was directly produced by the two-part Avengers event consisting of Avengers: Infinity War and Avengers: Endgame. The net costs for the two films, respectively, were $775 million and $899 million for the two movies--about $1.7 billion in 2019 terms. Of that some $700 million was spent on the productions, net, not gross, ($325 million and $355 million in current dollars, respectively) with the rest--the other $1 billion!--going to prints, advertising, video release costs, participations, residuals, "off the tops" and interest.

These are staggering sums. But the two films together grossed over $4.8 billion at the box office, which came to over $2 billion in rentals, plus another billion or so from the home entertainment, TV, etc. markets, working out to over $3 billion in overall revenue, and about $1.4 billion in profit. Overall it was a colossal return that made the colossal investment entirely logical in dollars and cents terms even if one thought only in terms of the two movies alone rather than the bigger Marvel money machine, and the boost it gave to other movies in Marvel Phase Three and after. (To cite but one example, Captain Marvel by itself reportedly made over $400 million+ in profit, and this would seem at least partially attributable to its connection with the Avengers event.)

Alas, recently we have seen a stream of reports about how the numbers that reached the press may have understated Disney's outlays on certain projects--like Dr. Strange 2. (The movie cost the studio $100 million more than initially reported, taking a big bite out of the profitability that Deadline calculated in 2022. Subtracting $100 million from its estimated near-$300 million profit would knock it down from being ahead of Black Panther 2 and Jurassic World: Dominion to being safely behind them.)

The facts about Dr. Strange 2 came out because there was a massive British government subsidy to the movie's makers in the form of a cash reimbursement for the expenses they incurred filming in Britain under that government's Film Tax Relief scheme. Getting that money required a public financial statement in which the truth came out.

Now we are hearing similar claims about the Avengers two-parter, also on the basis of the statements filed in the process of getting those British government subsidies. According to these it seems that the production cost, after the aforementioned reimbursement, was not $700 million but $1.2 billion.

Taking these numbers at face value this would mean an extra half billion dollars went into those movies, which now would clearly appear to be the most expensive made in the history of the world.

Of course, even with the half billion subtracted from the aforementioned sum the spectacular $1.4 billion profit ends up a still, frankly spectacular, $900 million profit, even before, again, we think of all the other ways in which the movies' success has contributed to the profitability of the MCU and its owner Disney. But with even Disney's more profitable ventures time and again looking less profitable than before, and the losses from the flops they can less avoid admitting pile up (Disney had a $300 million+ loss from Strange World and Lightyear alone last year, Indiana Jones 5 and other catastrophes this year, without even looking at the troubles the studio has had in the streaming area), it is not the news anyone favorably inclined toward, or invested in, the company wants to hear.