A (Moderate and Nuanced) Analysis of Backrooms, Obsession and Theaters in 2026 So Far

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A (Moderate and Nuanced) Analysis of Backrooms, Obsession and Theaters in 2026 So Far<br>Plus The Data on YouTubers, Horror, Original Films, Moana, Supergirl, Minions, The Mandalorian and Grogu and More in a Very Long Deep Dive<br>Entertainment Strategy Guy<br>Jul 24, 2026<br>∙ Paid

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(Welcome to the Entertainment Strategy Guy, a newsletter on the entertainment industry and business strategy. I write a weekly Streaming Ratings Report and a bi-weekly strategy column, along with occasional deep dives into other topics, like today’s article. Please subscribe.)

I have somehow yet to write about the buzziest entertainment story of the year so far.<br>I speak, of course, of Backrooms and Obsession.<br>Is it because I don’t see how this is great news for the theatrical box office? Actually, no, I totally get that. Almost out of nowhere, two new films from young directors dramatically over-performed. One became a blockbuster and one is very popular. That’s absolutely terrific. And the box office is up compared to 2025, and closing in on the pre-pandemic average.<br>Of course, a number like “two” is a small sample size, which naturally leads me to worry:<br>Are we overhyping this trend?

Because Hollywood loves to overhype trends. For example, we all remember just four years ago when a certain East Asian nation came to conquer Hollywood. I speak of South Korea, right after Squid Game became a global phenomenon for Netflix. Everyone rushed to South Korea to find their next global hit.<br>So how’s that going?

Yikes.<br>That’s right: the South Korean film industry is struggling. The streaming boom faded, and it turns out South Korean TV shows didn’t take over America. This is why precision in data analysis matters: the success of Squid Game showed that the ceiling of success of foreign language TV shows had been raised in America. But the data showed that the hit rate of foreign language shows had not. (I tried to tamp down the hype for foreign TV shows in 2022. Did folks listen? The opposite, if anything.)1<br>You could add concert films, anime, faith-based films and maybe musicals to the list of potential box office saviors that never saved the box office.<br>I worry, writing all of this, that I’ll come across as too negative, but there’s been quite a bit of hype around the relative successes of Backrooms, Obsession, Iron Lung and Amazing Digital Circus and the relative failures of Star Wars: The Mandalorian and Grogu, Supergirl, Disclosure Day, Masters of the Universe, Minions & Monsters, and the live-action Moana. I don’t want to be a downer here—which is ironic, because I’ve long been bullish on theaters, pushing back against the “theaters are in structural decline” narrative for years—but right when almost everyone in town is ecstatic, I’m worried.<br>I don’t want Hollywood to learn the wrong lessons from the terrific success story of movies in 2026. (See this fun article for past times Hollywood has done just that.) I’m going to break down the box office data from this year and past years to answer what may or may not have changed based on the success of Backrooms and Obsession. As usual, expect loads of nuance, moderation, history and caveats. And I’ll try to be honest when I say we don’t know or can’t say for sure.<br>More than anything, I want to write the most comprehensive analysis of the Obsession and Backrooms (I’m calling them O&B from here on out) that you’ll find on the internet. This article is over 5,500 words long, with 20+ images.<br>If you want hype, I can’t help you. If you want a much-too-long very deep dive through a bunch of box office trends, stay tuned.<br>Today I’ll look at…<br>Why I’m actually worried about the box office, despite these successes…

Quantify how important popular and blockbuster films are to theaters…

Look at the ceiling for YouTuber-helmed films…

Explore what has and mostly hasn’t changed for the horror genre in the 2020s…

Dive into A24’s recent hit rate...

See if Blumhouse has their mojo back (and if they ever lost it)…

Discuss why the potential death of superheroes and Star Wars worries me…

Ask whether “original” stories have actually taken over the box office…

Explain how important IP is for the box office, even today…

And run through some scenarios on what went well and poorly at the box office this summer.

And a whole lot more. But let’s start by defining terms...

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Defining Terms

Before we can get to the data, let’s define some terms. And start with a funny contradiction:<br>Horror films aren’t nearly as profitable as superhero films. That said, horror films are very profitable compared to superhero films.

How can both things be true?<br>As I’ve written about before, when box office analysts or journalists use “profitable”, they often mean different things. I wish everyone talked about box office (and streaming) success in terms of the “five factors” of box...