These charts show why studios are likely to delay 'Tenet' and 'Mulan' again

Key Points
  • Less than 17% of the 5,440 movie theater locations in the U.S. are open.
  • Major cinemas hope to be able to reopen by the end of July, but that depends on if studios keep their current movie release schedule.
  • States that have kept their indoor cinemas closed represent 24.5% of all U.S. theaters
  • States that are allowing movie theaters to reopen have audience caps that range from 25% to 66%.
A pedestrian walks past a shuttered movie theater, with the message 'Stay Safe and Healthy' displayed on the marquee, on March 19, 2020 in Los Angeles, California.
Mario Tama | Getty Images

Movie theaters shut down when Covid-19 cases were topping 20,000 a day in March. Now, they are trying to reopen when cases are over 60,000 a day.

Movie theater operators are feeling the pressure to reopen as rent costs pile up. The hope for AMC, Regal, Cinemark and others is that they will be able to resume business by the end of July, but that depends on whether studios keep their current movie release schedule.

Currently, less than 17% of the 5,440 movie theater locations in the U.S. are open, according to data from Comscore. However, that number could change if more states rollback reopening plans amid growing numbers of Covid-19 cases.

(Note: In the chart above, a theater is considered open if it is collecting revenue. In some cases, that revenue may come from advanced ticket sales, merchandise or providing customers with movies to stream online.)

The 915 theaters that are currently open are a combination of drive-in locations and independent cinemas. These theaters are showing library titles like "Star Wars," "Jaws," "Back to the Future" and "Black Panther." But those films will only tide over audiences for a few weeks. Without fresh blockbuster content, movie theaters won't be able to stay open for long.

For months studios have shuffled and reshuffled their film release schedules as cases in the U.S. have continued to spike. The release dates of Warner Bros.' "Tenet" and Disney's "Mulan" are being used as an anchor for movie theaters for reopening. 

For the major movie theaters, the aim is to open between two to four weeks ahead of these releases, allowing enough time for employees to be retrained and to get customers used to new safety measures like social distancing and wearing masks. That's why when "Tenet" and "Mulan" departed their mid-July release dates for August, movie theaters also postponed reopenings. Fear is growing that these titles, and more, will be delayed by studios again.

A spike in coronavirus cases 

On Wednesday, the United States reported 67,417 new cases of the coronavirus, setting a fresh record for new cases reported in a single day, according to data collected by Johns Hopkins University. Over the past seven days, the U.S. has reported an average of more than 62,000 new cases per day, up 21% compared with the seven-day average a week ago. 

The sharp uptick in new cases has led a number of state governors to scale back reopening plans, either freezing restrictions where they are, or reimplementing new restrictions. Health experts have warned consumers against returning to movie theaters during the pandemic, calling it "too much of a risk" since it puts strangers in close proximity to one another.  

Currently, the states that have kept their indoor cinemas closed represent 24.5% of all U.S. theaters, according to Comscore data

Among those states is California, which has the largest number of theaters with 518, but has only 28 theaters that are able to make revenue during this time. New York, which has the third-largest number of theaters with 292, is also one of the states that is not permitting theaters to reopen.

Some movie theaters have said they can operate with as little as 10% attendance, but that isn't a sustainable business model for the long term. The majority of business occurs on weekends and consumers won't easily shift away from that habit.

Texas and Florida are the states with the second- and fourth-largest number of movie theaters. Both states have experienced massive spikes in the number of reported coronavirus cases in recent weeks, but aren't banning theaters. However, if the virus worsens, they could be forced to place new restrictions on businesses. This has already happened to bars in both states.

"I don't see theaters opening in our largest states for the rest of the year," Michael Pachter, analyst at Wedbush, said. "And once Florida and Texas get religion, they will close everywhere."

Even if theaters open, it doesn't mean that moviegoers will flock there. According to a survey in mid-July  conducted by Morning Consult, a global data intelligence company, only around 20% of consumers feel comfortable going to the movies right now. 

States also are capping capacity at 25% to 66% of their prior levels. Analysts says this could convince studios to hold off on releasing new films until more people are able to attend.

"We now expect domestic theaters to be largely closed until mid-2021, in part because we don't think studios will be interested in releasing their largest movies into a capacity-constrained footprint," Doug Creutz, an analyst at Cowen wrote in a research note Thursday.

John David Washington and Robert Pattinson star in "Tenet," an upcoming spy film written and directed by Christopher Nolan.
Warner Bros.

Regal Cinemas are expected to reopen in the U.S. on July 31, two weeks before "Tenet" is released. 

"To tell you that I am not worried would not be the truth," said Mooky Greidinger, CEO of Cineworld, which owns U.S.-based Regal Cinemas. "I am worried."

While Greidinger hopes that the film will not be delayed again, he noted that some states in the U.S. are "not looking good enough" for cinemas to reopen. 

"The international market ... is much more ready than the U.S.," he said.

The cost of opening too soon

For blockbuster features like "Tenet" and "Mulan," which are looking to recoup high production budgets and massive marketing spending, the closures aren't very appetizing. 

"Tenet" cost around $225 million to produce and "Mulan" had a budget of $200 million. Add on marketing costs, which are usually around half of the production budget, "Tenet" will need to achieve $350 million in ticket sales just to break even and "Mulan" would need around $300 million. It's unclear if either film would be able to reap a fraction of that from the U.S.

International cinemas, many of which have been able to reopen with attendance caps, typically account for 60% or more of a Hollywood blockbuster's total ticket sales, but aren't back to any semblance of normal operations. 

Cineworld CEO on how movie theaters plan to reopen safely amid the coronavirus pandemic
Cineworld CEO on how movie theaters plan to reopen safely amid Covid-19 pandemic

If studios opt to release films when only a portion of theaters are open, there are piracy concerns. Consumers are craving new content, and might watch illegal copies that would inevitably begin circulating. 

Last year, the Global Innovation Policy Center estimated that worldwide online piracy costs the U.S. economy at least $29.2 billion in lost revenue each year. That figure could be as high as $71 billion, the center, which is part of the United States Chamber of Commerce, reported. That's a revenue reduction of between 11% and 24%, it said. 

And that was without a global pandemic preventing people from going to movie theaters.

No summer movie season in 2020

"My bet is that one or more films will debut and flop, and the rest of the slate will be delayed into next year or will be released direct to streaming/VOD," Pachter said.

Pachter said he doesn't foresee theaters in the some of the larger states opening "for the rest of the year." 

The delayed releases have not been an inspiring sign for the industry.

"Moving in fits and starts does not instill confidence." Paul Dergarabedian, senior media analyst at Comscore, said. "And being very definitive and forward thinking is a smart move."

Liu Yifei stars as Hua Mulan in Disney's "Mulan."

Sony and Universal were quick to push the majority of their film releases into 2021, while others have been forced to adapt every few weeks. In waiting so long to delay films, many of these studios may ultimately run into issues finding future release dates that aren't already occupied by competitors.

Still, with much of Hollywood's production shutdown due to the pandemic, holding off on releasing some of these films until 2021 could help fill the gaps left by projects that have been unable to be completed.

"2021 to start with, was looking to be one of the best years ever," Greidinger said. "So I guess now it has a very high chance ... maybe to be one of the best years ever, if not the best."  

Disclosure: NBCUniversal is the parent company of Universal Pictures and CNBC.