It’s difficult to believe that a movie released quietly in the month of June on Netflix would by the end of August that same year the biggest movie in the world, even to the point of reaching the top of the weekend box office in a short 2 day run.  That is the reality we have seen happen with the sudden phenomenon that is KPOP Demon Hunters.  The film made it to the streaming platform after it was abandoned by its original creators, Sony Animation, and right now Sony is probably kicking themselves over relinquishing this film to Netflix.  But success on streaming has come to mean many different things, and a lot of it isn’t exactly clear to most people outside of the business,  To be regarded as a success, a film needs to be measured with different kinds of barometers that assess it’s value.  For most of cinematic history, films have been judged by their box office sales.  The measure of a successful film traditionally has been based on if it can turn a profit in ticket sales, and this is weighed against the cost of making that film.  If the movie makes more than it’s cost, than it has justified it’s existence, and the goal thereafter is to maximize that profit even further.  But, the passage of time can also swing certain film’s fortunes from disappointing to successful, and this is based on ancillary factors like home video sales and tie-in merchandising.  But, streaming is a whole different kind of market that has changed the ways we judge a film’s success.  With streaming, you can calculate the value of a film based on individual sales, because there is no pay to watch factor.  With Netflix, entry is a monthly subscription fee and that opens the viewer up to watching anything they want when they want that’s available on their platform.  And the actual viewership numbers for each program is not independently measured but is instead reported by Netflix itself.  So, in that kind of market of on demand content for one nominal monthly fee, how exactly do we know what is a hit and what is not?

For KPOP Demon Hunters success was not immediate.  It released on June 20th without much in the way of fanfare.  Internally, Netflix was pleased with the viewership numbers that they were seeing, but it was not exceeding what they had gotten from other original animated films on their platform.  Films like Klaus (2019) The Sea Beast (2022) and Orion and the Dark (2024) were just modest successes for Netflix as an original animation producer.  More often, they were more successful being the refuge for small independent studios when their movies were in limbo after the studio either closed down like Blue Sky, which Netflix got the film Nimona (2023) out of, or were the place for more experimental fare, like Guillermo Del Toro’s Pinocchio (2022).  During the pandemic, a big studio like Sony looked to Netflix as the place where they could get their newest film released so they could avoid disaster with the theatrical market shut down at the time.  The film, The Mitchell’s vs. The Machines (2021), made it to the platform in this circumstance, and this likely helped Sony down the line determine where to send their other film that they seemed to have little faith in recovering their investment in.  KPOP Demon Hunters certainly had a built in audience with the rapid pop music fandom that would’ve certainly given it a chance, but Sony seemed more concerned with the direction that their more successful Spider-Verse was heading in.  Spider-Man: Across the Spiderverse (2023) was a massive success, but completing it’s follow-up sequel was becoming an issue and that’s where Sony Animations’ focus was being directed.  KPOP Demon Hunters would’ve been too much of a creative risk for Sony which was trying hard to compete with the top dogs like Disney, Dreamworks and Pixar, and they didn’t want a financial disappointment to derail that.  So, giving it to Netflix would help to shield them in case it didn’t work out.  Maybe there it would find it’s audience.  Little did they know just how much of an audience Netflix would help this little movie find.

It wasn’t immediate.  It premiered modestly at first, bolstered no doubt by KPOP super fans.  But the premiere numbers were not exceptional.  It’s first week viewership, based on Netflix’s numbers, paled in comparison to those of the Disney+ premiere of Moana 2 (2024), a movie that was also a huge success in theaters.  But, what Netflix started to notice that took everyone by surprise was that the viewership numbers for the film weren’t going down; they kept going up, week after week.  After a month, KPOP Demon Hunters had reached the top ten movies of all time on Netflix’s streaming charts and was still climbing.  But, there was another phenomenon that proved that the movie was more than just a streaming success.  The film’s soundtrack was rising up the chart in record sales.  One of the songs from the film, titled “Golden,” had even reached number one on the pop charts.  The last song to do that was Disney’s Encanto’s (2021) “We Don’t Talk About Bruno,” and it was the first movie soundtrack to chart at #1 since Encanto too.  The success of a movie soundtrack is a pretty good indicator that your film is becoming a success outside of it’s streaming boundaries.  But, it also seems that even Netflix underestimated how big this would be as well.  When you know your movie will have broad cinematic appeal, you would want to maximize profit off of it with a lot of tie-in promotions.  But, Netflix didn’t think that far ahead.  There are no tie-in merchandise or cross promotions going on with this movie, and Netflix is having to play catch-up quick so that they don’t miss the opportunity while this movie is still on a hot streak.  But, one thing they could do was break their longstanding rule about not giving their movies a wide release in theaters.  As KPOP Demon Hunters fever was at it’s highest point, the streaming giant relented and put out a Sing-Along version of the film into 1,700 screens across North America for just two days.  And even though it was brief, the end result still gave Netflix their first ever #1 film at the weekend box office.

It wasn’t the first time Netflix had charted in the box office top 10.  Two and a half years prior, Netflix had put out Rian Johnson’s Glass Onion (2022) into theaters for a one week run; likely due to an obligation in their contract with the director.  The film was a modest success in that one week, and many wondered if it would’ve continued to perform well if given a lengthier run over the holidays.  The problem is that Netflix has never allowed themselves to pursue that question even further.  They have been, since the beginning, a streaming centered business model.  They have spent billions on production costs to build up their library of films and shows, but the only revenue that is generated for them is based on their monthly subscription revenue.  Their investment in quality shows and movies has seemed to pay off in the long run, as they are undisputed the kings of streaming, beating out even the competition from the major studios that all launched their own streaming platforms in the last couple years.  But, they at the same time seem to leaving a lot of money on the table by not putting their films out in theaters.  The movie theater owners are not against accepting their movies, even though Netflix has done a lot to drive down their business over the years.  Netflix seems determined to stick with their own business model, which is to make the movie industry conform to them and have their streaming first form of distribution be the new norm of Hollywood.  But, as we have seen play out in the last couple of weeks, there is still an appetite for watching movies in theaters when it’s the right kind of movie.  A movie like KPOP Demon Hunters certainly got it’s start on streaming, but it’s grown far bigger than that and perhaps Netflix is handicapping themselves by still sticking with their own business model.  They put the movie out on their own terms, just for two days, but all it has led to is more questions about their choices.  How much bigger would it have been had they kept it playing in theaters longer than they had?

Part of Netflix’s rationalization for releasing movies they way they have is that they believe that movie theaters are a dying business and that streaming is the future of entertainment.  There is some validity to Netflix’s claim in this sense, as movie theaters have been struggling in the last few years.  Of course Covid was a major factor in the downturn of the theatrical business, but there have been underlying issues that were present long before the pandemic.  The rising cost of tickets has been a particular sticking point with customers.  For many people, they feel like they are being priced out of the movie theater experience, with tickets on the low end costing upwards of $15 dollars in most places now.  This has become especially expensive for for families, with a day out to the movies possibly costing around $100 after tickets and concessions.  Paying Netflix or any of the other streamers a flat monthly fee between $10 and $15 just seems more economical by comparison.  But, there are still movies that are able to draw people to the theater.  The number of them are fewer than it has been before, but they’ve managed to keep theaters afloat in these difficult times.  Netflix makes the case that their platform allows for better visibility for movies that normally wouldn’t have a chance in competition at the movie theaters.  It’s probably why you see a lot fewer mid-budget movies in the theaters, because putting them on streaming has been viewed as a safer bet.  Previous box office titans like Adam Sandler and Eddie Murphy almost exclusively premiere their films on streaming now.  But there’s also the argument that the reason movie theaters are struggling is because they don’t have enough in the way of movies that could boost box office, such as the ones that go to places like Netflix.  The slate of films playing in theaters are either low risk indie films like the ones from A24 and Neon, or big studio tent-poles.  What movie theaters need is more variety, particularly with the movies that have since left them for streaming.  Netflix may argue that people who go out to the movies are not the same as the ones that consume movies on their platform, but KPOP Demon Hunters just proved very definitively that there is definitely a lot of crossover that they have been ignoring.

One thing that has been changing recently is the mindset of the major studios regarding where they are choosing to premiere their films.  Disney in particular made a different judgment call with two projects that they initially planned for streaming on Disney+, and it led to some much needed financial success.  Moana 2  started off in development as a six part animated series, continuing the adventures of the characters from the popular 2016 original as an exclusive for Disney+.  But after a string of disappointments for the Disney Animation studios with Strange World (2022) and Wish (2023) falling hard at the box office, Disney needed something with a built in audience to help boost the ailing studio’s image as a box office contender.  The series was whittled down into a 100 minute film and was released in theaters in November 2024, and the result was a billion dollar grossing film.  Some complained that the film was uneven because of it being reworked in the eleventh hour and that it was not as good as the original, but that didn’t matter.  The film was a financial success because it was a movie that people wanted to see in theaters, including a lot of families.  A similar switch in release strategy also happened with the Lilo and Stitch (2025) remake, as that film was also originally developed as a Disney+ exclusive.  The lesson learned by Disney is that they should strategize which movies would have the best chance of bringing families to the theater, rather than trying to bank on just their brand giving them the boost they need.  The downside would be that studios like Disney would bank more on safer bets rather than big risks, but as well as Lilo and Stitch and Moana 2 have done, it’s counterbalanced with failures like Snow White (2025) and Wish.  What these successes have done is show that theatrical grosses are the most effective barometer for signalling how your brand is doing and it’s something that Disney and other studios are returning more often to now for deciding their future directions.  Had they gone all in on the streaming route, they would’ve missed out on $2 billion worth of revenue on those two films alone.  And premiering in theaters first has not cut into their appeal on streaming either, because Moana 2 has been one of the most streamed movies of the year; even in KPOP Demon Hunters territory.

Netflix can certainly think that monthly subscriptions alone can sustain their company.  It’s been a benefit to them so far, as they are one of the most valued brands right now in the entertainment business.  But, as KPOP Demon Hunters record-breaking weekend grosses have shown, they can make even more money if they wanted to.  The theatrical experience, given the right movie, can help a film endure far beyond it’s original release.  A lot of films benefit from audiences reactions, and that’s something that you can’t replicate just in your living room by yourself or with a couple friends and family.  KPOP Demon Hunters‘ brief but explosive run in theaters was a big deal because audiences finally had an opportunity to see this movie with a crowd of fans, all singing along with them.  It was like a concert experience for them.  Keep in mind, many of the people who sold those screenings out had already seen the movie over the two months that it had been playing on Netflix.  They already loved the movie, but they hadn’t experienced it in a way like this, and that was something worth leaving the house and paying a ticket price for.  KPOP Demon Hunters will undoubtedly be remembered far longer in pop culture because of that.  Most other Netflix films, even the ones deemed a success, have short life spans in the public conscious.  This is largely due to way that Netflix’s algorithm works.  Some movies are pushed to the top of the home page, especially the ones that Netflix wants you to see right away, but there are so many films that quickly disappear into the background if there is low interest in them.  Most people probably aren’t even aware that Netflix has had many other original animated movies on their platform, including another one from the same Sony Animation team that made Demon Hunters; The Mitchell’s vs. The Machines (which, personal opinion, I actually like a lot more).  Netflix honestly has nothing to lose and more to gain if they put their movies into theaters first before putting them on streaming; and I mean in wide release.  Something like KPOP Demon Hunters should have been playing on twice as many screens as it had and it would probably been hitting 9 digit figures in grosses by now.  It’s hard to make the argument that it’s the biggest animation success story of the year when the only thing you have to show for it is a single weekend gross and a chart topping soundtrack.

Netflix will almost certainly fall back on what has worked for them before, but I feel like KPOP Demon Hunters has challenged their business model the most out of all the other movies they have made.  There has to be some talk around the studio about what they’ll do when they inevitably make a sequel to the film.  It would be foolish not to give a sequel a wide release in theaters.  They’ll reap the benefits of a huge box office payday and see that same audience follow the film to their streaming platform.  In general, movie studios across Hollywood are definitely looking at theatrical first release strategies as a net benefit for their brands.  Some movies take more time to find an audience, but at least with a theatrical release you get that upfront monetary value to gauge the movie’s initial appeal.  You make a profit in theaters, then the rest is all an added bonus.  And we’ve seen that movies don’t lose their value by the time they make it to streaming.  If you place the movie on streaming first, there is a good chance that the film may get lost in the shuffle and buried in the algorithm.  At least when it’s put out in theaters it has a chance to generate some individual value.  Let’s not forget, Netflix has their controversial money losers too, including this year’s The Electric State (2025), which for some reason the studio poured over $300 million into.  Did Electric State drive any more traffic to Netflix? Unlikely, and after about a couple of weeks it was out of their top streaming chart and buried deep in the algorithm.  Even Netflix’s accounting couldn’t hide the wasteful spending that that movie clearly showed.  Would theatrical exhibition have helped?  Probably not, but at least you would have a clear dollar value on how audiences received the film rather than the internal number of viewership that they keep track of.  As the streaming wars have died down, the movie studios are looking at streaming as an extension of a movie’s life span more and more and not as the thing that’s going to take over the business.  They are diversifying, and Netflix should consider that as well.  They have a great many films that are sadly overlooked by most audiences, and a lot of those films would have generated more buzz if they were properly presented on a big screen from the start.  KPOP Demon Hunter’s phenomenal success could be the thing that shifts the way Netflix looks at exhibition, and hopefully we’ll see that bright red “N” logo on many more big screens in the future.