Jason Blum, who launched his independent production career in the early 2000s after departing from Harvey Weinstein’s Miramax, once grappled with fears of failing without the backing of a major studio. His fortunes changed with the low-budget horror hit Paranormal Activity, produced for under $15,000 by Oren Peli. Blum’s persistence led to the film being picked up by Steven Spielberg’s DreamWorks, eventually grossing an astounding $107.9 million domestically and $194.2 million worldwide. This success not only secured Blumhouse’s place in cinema but also ignited a wave of profitable micro-budget horror films, such as Insidious and The Purge.
Under a lucrative arrangement with Universal, Blumhouse produced a number of successful titles, including revivals of the Halloween franchise and critically acclaimed films like Jordan Peele’s Get Out (2017) and Spike Lee’s BlacKkKlansman (2018). However, Blum now finds himself confronting a rekindled fear of failure. A bleak turn began in 2024, continuing into this year with all four of its upcoming 2025 releases failing to capture audience attention. These include Wolf Man, which earned $34.1 million globally, The Woman in the Yard at $23.3 million, and Drop at $28.6 million.
Yet the most surprising flop was M3GAN 2.0, which underperformed horrifically over the June 27-29 weekend, especially in light of its predecessor’s success. The original M3GAN, centered on an AI doll that turns malevolent, debuted to $30.4 million domestically and grossed $181.7 million globally, made on a $12 million budget. In contrast, M3GAN 2.0, costing over $25 million to produce, earned only $10.2 million domestically and $17 million overall.
The direction shift taken by director Gerard Johnstone, who opted to transform the sequel into a science-fiction action film, alienated the audience. Box office analysts have raised concerns about the decision to release the sequel during a particularly competitive summer.
Insiders at Blumhouse have reported that the company is undergoing a period of soul searching. Feeling the pressure of an oversaturated horror market, the studio is reassessing its strategy, acknowledging that releasing up to 10 titles annually may be overly ambitious. Blum recognized that past successes do not necessarily translate to current market dynamics.
Looking toward the future, Blumhouse anticipates the release of Black Phone 2 in October, a film identified as pure horror, and December’s Five Nights at Freddy’s 2, which has reportedly shown positive feedback from test audiences. The first installment of Freddy’s raked in an impressive $297.1 million globally against a modest budget of $20 million, establishing it as one of Blumhouse’s highest earners.
Amid these challenges, Blumhouse is turning its attention to the upcoming M3GAN 2.0 spinoff, SOULM8TE, due in theaters on January 9, 2026. Although it is too early to determine if any changes will affect the project, early reports indicate positive test screenings.
In a recent podcast interview with The Town’s Matt Belloni, Blum openly discussed the troubles surrounding M3GAN 2.0. “We all thought Megan was like Superman. We could do anything to her. We could change genres… And we classically over-thought how powerful people’s engagement was with her,” Blum admitted, acknowledging the backlash stemming from the film’s genre shift.
Industry experts concurred that the film’s failure boiled down to excessive confidence. One producer remarked, “They thought they were being all clever changing the dates and the genres,” while another emphasized, “This was not the sequel audiences wanted. It was the movie that the director wanted.”
Fortunately for Blumhouse, insiders at Universal expressed confidence in the studio’s ability to rebound. With relatively low production costs, studio officials believe all these films will ultimately prove profitable. Blum reflected on the cyclical nature of talent in the industry, stating,
“If you look at any massive talent… every one of your favorite people have gone through slumps. And that applies to Blumhouse, too.”
Paul Dergarabedian, a chief box office analyst at Comscore, commented on the current crowded market, stating, “It’s playing out more like a cinematic gladiator school… it’s the best of times for some and the worst of times for others.”
