CICC: The performance of film companies in the second quarter was relatively flat, with a year-on-year increase in box office during the summer season

According to the Zhitong Finance APP, China International Capital Corporation (CICC) released a research report stating that in Q2 2025, most film companies experienced a decline in revenue due to lackluster box office performance, with profits declining even more significantly year-on-year due to rigid cost pressures. The box office for the summer season of 2025 is expected to be slightly lower than previously anticipated (CNY 13-16 billion), mainly due to the late scheduling of major domestic commercial films; since mid to late July, viewing demand has shown significant improvement with the release of films; some films' box office and IP derivative businesses may exhibit long-tail effects, and overall viewing demand is also expected to continue. Additionally, films for the National Day holiday have been scheduled, with imports of IP sequels such as "Now You See Me 3," "Zootopia 2," and "Avatar 3" expected to be introduced in Q4 2025, which may provide some support for the annual box office. It is recommended to pay attention to the box office performance of domestic films and the rhythm of imported film introductions. CICC's main viewpoints are as follows: Q2 2025 Film Company Performance Overall Relatively Flat In Q2 2025, most film companies experienced a decline in revenue due to the lackluster box office, with profits declining even more significantly year-on-year due to rigid cost pressures. Enlight Media saw both revenue and profit grow year-on-year in Q2 2025, with the derivative business of "Ne Zha 2" likely being its main contributor, and the film's box office also exhibiting some long-tail effects. Q2 2025: Box Office Under Pressure, Film Companies Focus on Deepening Cost Reduction and Efficiency Improvement According to EntGroup, the national box office including service fees in Q2 2025 was CNY 4.85 billion, a nearly 35% decline, putting pressure on the revenue of various film companies. CICC believes that Q2 is typically a low season for the film industry, and the reasons for the sluggish box office in Q2 2025 include the siphoning effect of major films' box office, insufficient content supply in the industry, and diversion to other forms of entertainment. However, some film companies' profit declines or losses in Q2 2025 were better than previously expected, mainly due to effective cost control measures. In the current environment, film companies may further deepen cost reduction and efficiency improvement to enhance overall operational efficiency. 2025 Summer Season: Achieving Box Office of CNY 12 Billion, Year-on-Year Positive Growth According to EntGroup, the box office including service fees for the 2025 summer season is approximately CNY 12 billion, a year-on-year increase of 2.9%; the number of viewers increased by 12.8% to 322 million, and the average ticket price decreased by 8.8% to CNY 37.24; the top three films during this period were "Nanjing Photo Studio," "Little Monster of Langlang Mountain," and "Chasing Shadows." CICC believes that the box office for the 2025 summer season is slightly lower than previously expected (CNY 13-16 billion), mainly due to the late scheduling of major domestic commercial films; since mid to late July, viewing demand has shown significant improvement with the release of films; some films' box office and IP derivative businesses may exhibit long-tail effects, and overall viewing demand is also expected to continue. National Day Films Have Been Scheduled, Focus on Q4 Imported Film Introductions According to Maoyan Professional Edition, as of September 1, 2025, key films scheduled for the National Day holiday include: "Assassination Novelist 2" (co-invested by Huace Film & TV and Maoyan), "Panda Project 2" (mainly distributed by Maoyan), and "The Starry Sky of the Three Kingdoms" (produced by Guomai Culture and Enlight Media), all scheduled for October 1. Reserve films include "Catching Spies," "Volunteer Army Part Three," "Penghu Sea Battle," and "Place of Arms," among others. Additionally, imports of IP sequels such as "Now You See Me 3," "Zootopia 2," and "Avatar 3" are expected to be introduced in Q4 2025, which may provide some support for the annual box office It is recommended to pay attention to the box office performance of domestic films and the introduction rhythm of imported films. Targets Recommend Shanghai Film (601595.SH), Enlight Media (300251.SZ), and suggest paying attention to Wanda Film (002739.SZ), Maoyan Entertainment (01896), etc. Risk Factors Content supply falling short of expectations, key content box office performance not meeting expectations, piracy dissemination, tightening regulation