November 2025
– Mike Cummings, Sr. Principal, TK Architects
The State of Cinema: Industry Insights and Opportunities Ahead
Earlier this year, I reached out to a number of domestic and international exhibitors to get their take on the current cinema landscape — what’s working, what isn’t, and what the next few years might hold.
The conversations, including input from one of the industry’s most respected icons, revealed a mix of realism and optimism: yes, challenges remain, but there’s also clear progress and renewed creative energy driving exhibition forward.
Here’s what I heard most consistently.
Current State of Cinema
Many exhibitors anticipated that 2025 would be a challenging year — and so far, that prediction has held true. Studios continue to feel the ripple effects of the 2024 strikes, which disrupted production schedules and shifted major release timelines.
- For example, Jumanji was delayed from 2025 to December 2026 due to actor availability.
Still, there’s a lot to be encouraged by:
- Premium large formats (PLFs), food & beverage programs, and in-theatre merchandise sales continue to perform well.
- International markets are showing signs of recovery, with new development and renovation activity beginning to accelerate.
- Audiences remain eager for shared, in-person experiences, especially when theatres provide something distinctive and well-executed.
Key Challenges
Every exhibitor I spoke with touched on one or more of the following themes:
• Content Flow
A consistent stream of high-quality films remains the top concern. The availability of content has improved since early 2025, but to maintain strong momentum, exhibitors say they need two to three strong titles per week. Studios are starting to acknowledge both franchise fatigue and the audience’s appetite for fresh stories — an encouraging shift that could reinvigorate the box office in the years ahead.
• Rising Costs
The costs of film, labor, and utilities continue to climb, creating a challenging environment for profitability — especially for independent operators.
• Sustaining Attendance
Maintaining consistent audience engagement remains a struggle. Many are looking beyond traditional marketing, exploring partnerships, events, and local community initiatives to bring guests back more often.
• Overreliance on Premium Formats
There’s no doubt that IMAX, 4DX, and other premium experiences have boosted revenue. But some exhibitors worry the industry risks becoming too “luxury-only” — similar to what’s happened in live sports and concerts — if affordability isn’t preserved for everyday audiences.
• Customer Experience
Improving facilities and service continues to be a major focus. Recruiting, training, and retaining quality staff remains difficult — yet it’s also key to shaping a great guest experience.
- Since COVID, many investments have focused on immersive technology and enhanced presentation quality, which audiences clearly appreciate.
- However, high construction costs, limited financing, and elevated interest rates make larger-scale facility improvements harder to pursue.
Outlook
Despite the obstacles, there’s a clear sense of cautious optimism across the industry. Most exhibitors believe that, while recovery will take time, revenues could return to pre-COVID levels within the next few years.
Some broader trends shaping the outlook include:
- Continued consolidation across domestic and international markets.
- Cultural relevance returning — movies are once again becoming “watercooler moments.”
- Immersive technology continuing to evolve, elevating both engagement and satisfaction.
- Mergers and partnerships — such as the Skydance–Paramount merger — helping restore confidence in the theatrical experience.
Emerging Opportunities
While the landscape continues to evolve, exhibitors are focusing on what they can control — creativity, adaptability, and connection with their communities.
• Diversified Revenue
Many new and planned projects are blending cinema with family entertainment concepts — integrating arcades, bowling, escape rooms, and other attractions under one roof. This hybrid approach helps stabilize revenue, attract a wider demographic, and extend the life of a property. While some worry about overbuilding, the high cost of these developments is likely to keep growth measured and strategic.
• Social Connection
Gen Z and Gen Alpha audiences are showing a clear desire for authentic, in-person experiences that go beyond what digital platforms provide. For this generation, theatres are becoming social destinations again — places to gather, not just to watch.
• Elevated Food & Beverage
From elevated menus to thoughtfully designed social spaces, enhanced food & beverage programs are proving to be one of the strongest tools for attracting new guests and encouraging longer visits. Operators investing in atmosphere and quality are seeing returns in both per-capita spending and repeat visits.
• Broader Content Mix
While tentpoles and opening weekends remain essential, many exhibitors are leaning into programming diversity. Mid-sized films, international releases, live events, concerts, gaming tournaments, and even streaming exclusives can provide meaningful incremental revenue. In certain regions, faith-based and community-driven content also continues to perform strongly.
• Reimagining Trailers
One exhibitor noted that trailers are still the industry’s best marketing tool — yet they’re often buried within lengthy pre-shows. Re-evaluating how trailers are presented could re-capture audience attention and strengthen engagement before the movie even begins.
• Experience Differentiation
Audiences often choose the movie first and the theatre second. The next opportunity lies in reversing that mindset — creating destinations so distinctive, comfortable, and service-driven that guests decide where to go before deciding what to see. The most successful entertainment centers, shopping districts, and mixed-use venues already operate this way, and cinemas can, too.
• Ongoing Reinvestment
Despite industry challenges, cinemas continue to reinvest in their spaces. According to Cinema United, that reinvestment has exceeded $1.5 billion over the last twelve months — a clear signal that exhibitors remain committed to innovation, improvement, and the long-term theatrical experience.
The takeaway from all these conversations?
Cinema is still changing — but it’s far from standing still. Theatres that embrace innovation, prioritize guest experience, and deliver something truly memorable will define what comes next.
We at TK Architects International remain bullish on the future of cinema, entertainment and social experiences and look forward to talking with you about them.
Sr. Principal, Mike Cummings
