A24 Hit Big With ‘Backrooms.’ Then It Picked a Fight With Theaters

Pop quiz: Rank the top-performing studios at the box office this summer.

I’ll wait.

If you had indie darling A24 in fourth place — ahead of both Paramount and Warner Bros. — congratulations.

You know where this story is going.

Thanks largely to the $400 million-plus global breakout of Backrooms, A24 finished the summer behind only Universal, Sony and Disney. And after the biggest hit in its history, the studio has decided it wants to be paid like the majors it just beat. Exhibitors tell me A24 used to command roughly 40 to 45 percent of ticket sales. Now it regularly wants a cut in the low- to mid-50s.

And that’s where the trouble started.

This weekend, A24’s Primetime — the sinister To Catch a Predator drama starring Robert Pattinson — opens in almost every major theater in the country. But not at Harkins, the Southwest chain with 33 locations. 

Harkins isn’t the only chain to balk. Marcus Theaters refused to screen A24’s The Invite, Tony and Onslaught after the two sides couldn’t agree on a ticket-revenue split. A spokesperson for the 77-location Midwest chain called A24’s proposed terms “economically unviable.” The parties finally reached what Marcus called “mutually agreeable” terms on Sept. 17.

A24 declined to comment.

The difference between the mid-40s and mid-50s may sound like inside-baseball accounting. To theater owners, it’s anything but. They say 10 percentage points, or even less, can separate a profitable run from a deal that might not make financial sense. “45 versus 53 does mean a lot to us,” says one regional programmer who works across several venues. 

“Disney can demand higher prices because they make us money all the time,” the programmer adds. “A24 can’t do that… Don’t put the cart before the horse.”

So has A24, already roiling the TV market, actually earned major-studio terms — or is it using one monster hit, Josh Kushner’s venture-capital cash and a $3.5 billion valuation to squeeze exhibitors for more?