Dec 6, 2023

Netflix to Increase Animated Feature Budget in 2024 Following Success of "Leo," "Kaiju," and Others

Netflix co-CEO Ted Sarandos said the company plans to increase its investment in animated feature films in 2024.

Speaking at UBS's Global Media and Communication Conference on Monday, Sarandos said Netflix will spend about $17 billion on programming content in 2024. Part of that spending will include increased investment in animated feature films.

According to Sarandos, animated films are among the most rewatched content by subscribers:

This may sound old news, but since Nielsen has been tracking streaming, all eight of the top 10 movies streamed so far have been animated feature films This is due to viewing time, which is often repeated, but is also highly valuable. There is plenty of appetite for more than a few films a year, as we are currently doing.

Sarandos' comments come as a bit of a surprise given that Netflix recently laid off a number of employees from its animation department in a restructuring move intended to reduce the number of animated feature films produced in-house.

At the time, Netflix had indicated that it would acquire more projects from third-party producers through output deals, which is more cost-effective than producing content in-house. Perhaps that was what Sarandos was referring to when he mentioned on Monday about increased investment in animated films. For example, shortly after the Netflix Animation layoffs were announced, the company further emphasized its commitment to acquisitions by revealing that it had signed a distribution deal with Lack producer Skydance Animation.

Nevertheless, Netflix's original productions are doing exceptionally well in 2023, and the studio may be reconsidering its decision to produce fewer of its own titles. As we reported last week, Adam Sandler's new animated feature film "Leo" was the biggest debut ever for a Netflix animated film in its first six days of availability. The film has been viewed for 103 million hours in its first two weeks and seems absolutely certain to surpass "Kaiju's" 28-day viewing record of 165 million hours.

In his speech, Sarandos referred to the two Netflix originals and explained, "I think the transition from 'Kaiju' to 'Leo' was success to success in a very new business."

Other original animated features that debuted strongly on the platform this year include "The Monkey King," "Miraculous: Ladybug & Cat Noir The Movie," and "Nimona"; Netflix is next week, while Aardman Animation's "The Monkey King" will debut on Netflix next week, Aardman Animations' "Dawn of the Nugget," a sequel to "Chicken Run."