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A film's financial success is often measured by its gross revenue. Ideally, studios want a film's "domestic" (which the American film industry defines as the United States and Canada) box office gross revenue to exceed production costs. Only rarely do films become profitable based on domestic revenue alone. Typically, the exhibiting theater keeps 45% of the gross and the remainder is paid to the studio as the rental fee. However, if a film has a high domestic gross in relation to its production and marketing costs, it will almost certainly turn a profit once revenue from other sources is included. During the 1980s the performance of a film on its opening weekend became crucial to the perception of its profitability. Films that had a poor opening weekend were often dropped quickly by cinemas.
A film that recoups production and marketing costs can be considered a success. If a film fails to recoup those costs by a significant margin, it is referred to as a box office bomb. However, international distribution, sales to television syndication, and home video releases as well as revenue from other sources (such as toy merchandizing) often mean some films considered domestic "box office bombs" in North America do make a profit for their studios, sometimes years after the film's release. For example, Head, a 1968 film featuring The Monkees, was a flop that became profitable for the studio years later when its cult film status led to its sale to Rhino Entertainment and its re-release in various video formats. The popularity (and profitability) of DVD sales has increased this trend significantly, leading many to doubt the significance of domestic grosses as a predictor of a film's overall success.
Different genres of film are subject to different standards of success. For example, action movies typically have higher production and promotion costs than love stories. Typically, the most notorious flops are summer blockbusters, which often entail huge costs to produce and face a highly competitive market. Advertising costs are not included in a movie's production costs, and can make a bomb's failure all the more crushing for the studio.
Most box office bombs are not career-ending for the film's main cast and crew. Ishtar was a notorious bomb but the careers of both its stars, Warren Beatty and Dustin Hoffman, continued with little noticeable affect. Jude Law has appeared in a series of major flops including the 2004 remake Alfie and Sky Captain and the World of Tomorrow, but is still cast in leading roles.
The size of a box office "bomb" can be determined by either the net loss sustained, or by a loss percentage (1 - gross revenue/production costs). By using these two measurements, the biggest U.S. box office bombs listed below are (respectively) Alexander (2004) with a net loss of $120,702,809, and Zyzzyx Road (2006) with a loss percentage of 99.9985% of production costs. Considering worldwide box office sales, the biggest loser was The Adventures of Pluto Nash (2002) with a net loss of $95,588,898.
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Films with a Domestic gross less than 10% of budget, highlighted.
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