DIS Walt Disney Co

By Erich Schwartzel 

LOS ANGELES -- Walt Disney Co. proved with its first "Star Wars" movie that the Force is strong. But is it sustainable?

That's the question facing the world's largest entertainment company with the release Thursday night of "Rogue One: A Star Wars Story," the first spinoff produced by the studio since it bought Lucasfilm for $4 billion in 2012.

Disney's first go at a Lucasfilm property, last year's "Star Wars: The Force Awakens," became the No. 1 movie in North American box-office history, collected more than $2 billion world-wide and established credibility with fans who were wary of the family entertainment giant handling the space opera. "Rogue One" is the first of several spinoffs that Disney plans outside of installments in the "Skywalker saga" made famous by the original trio of films. Next December, Disney will release the eighth episode of the Skywalker saga, followed in 2018 by a prequel focusing on Han Solo.

The upside could be massive. Spinoffs allow Disney to test what "Star Wars" stories or characters justify their own movies, television shows or consumer products, a yearslong strategy worth billions for the company, said Eric Handler, an analyst at MKM Partners. "You can carve a lot of new paths by taking this road."

Disney is borrowing from a playbook it popularized with Marvel Studios, which produces annual releases featuring characters that coexist within the same "universe."

The creation of competing "universes" has become all-important for other studios, like Comcast Corp.'s Universal Studios, which is planning a classic monsters universe starting with a reboot of "The Mummy" next year, and Time Warner Inc.'s Warner Bros., which has begun building a DC Comics universe that includes "Batman v Superman: Dawn of Justice" and next year's "Wonder Woman."

"Rogue One," which follows a band of rebel fighters plotting to steal plans to destroy the planet-pulverizing Death Star, takes place soon before the events of the original 1977 "Star Wars."

"Rogue One" isn't expected to match the record-breaking, $248 million North American debut of "The Force Awakens," but box-office analysts are anticipating another gargantuan hit.

The movie is projected to open in the range of $130 million to $150 million, but could go much higher since prerelease surveys often have trouble gauging such highly anticipated movies. The highest-grossing opening weekend of 2016 has been Disney's "Captain America: Civil War" at $179 million.

The nation's largest theater chain, AMC Entertainment Holdings Inc., said presales for the movie are higher than any release so far this year. Additional overseas grosses could to add up to a world-wide debut that exceeds $350 million.

As with "The Force Awakens," theaters will begin showing the movie at round-the-clock screenings on Thursday night. Disney said more than 4,100 theaters in North America have booked the movie.

The movie's rollout hasn't gone as smoothly as the "Force Awakens" arrival. Word of reshoots leaked during production, lighting up fan message boards with concerns that the movie was in trouble.

Die-hard "Star Wars" aficionados attending the movie's premiere in Los Angeles on Saturday said those fears turned out to be unfounded.

"Mind-blowing" was the review from Javier Paz, a Bay Area medical contractor and a member of the 501st Legion, an organization whose members dress up as stormtroopers and other characters. Critics' reviews have been generally strong, if not as enthusiastic as on "The Force Awakens."

"Rogue One" is more adult-oriented than most "Star Wars" movies, and doesn't ride into theaters with the pent-up demand that its immediate predecessor did, said Mr. Handler. That will contribute to the lower opening, but the movie could best "The Force Awakens" in China.

The "Star Wars" brand wasn't well-known in the world's second-largest box office when "The Force Awakens" came out, and the movie collected a solid, if not stratospheric, $124 million. "Rogue One," which opens in China on Jan. 6, will have audience familiarity on its side -- and the casting of Hong Kong action star Donnie Yen in a key role in the film.

Inside Disney, the records set by the "Star Wars" franchise have created tough comparisons for investors. Operating income for consumer products in the current quarter is expected to be down more than 20%, Disney executives said on their fourth-quarter earnings call, in part because "Rogue One" toys aren't expected to fly off shelves as "Force Awakens" merchandise did.

Hollywood is also watching "Rogue One" grosses as the industry nears a new box-office record.

The North American box office was expected to stand at an estimated $10.43 billion on Thursday, according to the National Association of Theatre Owners. That's about $700 million shy of the 2015 total of $11.12 billion, the highest year on record. Industry analysts said the record was within striking distance, and Mr. Handler predicted the year will end up about 1%.

Write to Erich Schwartzel at erich.schwartzel@wsj.com

(END) Dow Jones Newswires

December 14, 2016 12:06 ET (17:06 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.