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Iron Man |
]. Tuesday morning the company beat Wall Street expectations, announcing that first quarter revenue grew 75 percent and raising its 2009 revenue forecast. Superheroes are saving the comic book company from the economic downturn: DVD sales of "Iron Man" and "The Incredible Hulk" continue to be strong despite the overall softening of the DVD market. This is the ultimate sign that Marvel's move into self-produced movies is really working. And the blockbuster $85 million box office debut of "X-Men Origins: Wolverine," a character Marvel licenses to 20th Century Fox [NWS
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], shows the licensing business continues to deliver. Earnings per share did fall a penny to 57 cents. And Marvel's licensing business struggled, posting a 31 percent drop in earnings. But certain newer areas, like interactive games, are growing very fast. And the company invested $1 million in digital distribution of its comic content, and is expecting to see that yield returns moving forward.
Bottom line: the studio is really benefiting from the fact that it has zero exposure to the weak advertising market.
Marvel's film production business is well on track to compensate for the decline in other parts of the business. "Iron Man 2," "Thor" and "The Avengers" are in the works. The studio recently pushed back its release schedule for these films, but the awareness is incredibly strong. Marvel's big tentpoles are exactly the kind of film that manage to attract a huge range of demographics to theaters, and manages to buck the trend and sell huge numbers of DVDs.
The studio has a reputation for being incredibly disciplined about costs. Yes, its films have big budgets, but my Hollywood sources tell me Marvel's strategy is smart. It's really strict about how much it pays stars, and it doesn't give away big percentages of a film's gross, the way other studios do.
We'll see if Marvel can keep up its track record, but in this economy it seems any studio would be wise to apply these kind of strict controls.
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