Amazon’s Big Theatrical Gamble: Why the Tech Giant is Betting on Movie Theaters

Amazon's 2023 Fallout TV show

For years, streaming platforms have dominated the entertainment industry, leading many to believe that traditional movie theaters were on their way out. But in a surprising shift, Amazon MGM Studios is making a bold play for the big screen. At SXSW 2025, Amazon announced its commitment to 12-14 theatrical releases in 2026, with plans to increase to 16 films in 2027. This move signals a significant shift from the company’s streaming-first strategy and could reshape the future of Hollywood distribution.

Amazon’s Theatrical Pivot: Why Now?

Amazon’s decision to embrace theaters isn’t just about nostalgia—it’s a calculated business move. Here’s why the tech giant is going big on the big screen:

1. The Streaming + Theatrical Formula Works

For years, streaming services and movie theaters were seen as rivals, but now, studios recognize the benefits of releasing films theatrically before hitting streaming platforms. Films like Air and The Beekeeper gained major streaming traction after a strong theatrical run, proving that a dual-release strategy maximizes revenue and audience engagement. Theatrical runs generate buzz, credibility, and cultural relevance, making films more appealing when they eventually land on streaming.

2. Owning the Full Distribution Pipeline

Rather than relying on third-party distributors, Amazon is building its own global theatrical distribution and marketing arm. This means more control over releases, bigger profit margins, and the ability to shape its own industry influence. By handling theatrical releases in-house, Amazon can keep a larger share of box office revenue instead of splitting it with outside distributors.

3. Hollywood Credibility

Amazon MGM Studios recently became an official member of the Motion Picture Association (MPA), putting it alongside legacy studios like Disney, Warner Bros., and Universal. This is a clear sign that Amazon wants to be taken seriously as a major player in the theatrical space—not just a streaming service producing original content. The MPA membership also strengthens Amazon’s position in negotiating theatrical deals with exhibitors like AMC and Regal.

4. Expanding Audience Demographics

Amazon is strategically diversifying its film slate to appeal to a broader range of audiences. The studio’s largely female-led leadership team is focusing on films that aren’t just action blockbusters, but also mid-budget dramas, comedies, and genre films that attract different demographics. This sets Amazon apart from competitors that primarily chase superhero and franchise-driven content.

5. Movie Theaters Need Amazon (and Vice Versa)

Theaters have struggled in recent years, with fewer studio films making exclusive theatrical runs. Amazon’s commitment to 12-16 films per year is great news for exhibitors, providing a steady stream of content outside of the usual blockbuster tentpoles. In return, theaters offer Amazon something streaming can’t: prestige, cultural impact, and a strong box office presence that helps define a studio’s legacy.

What This Means for the Future of Film

Amazon’s move could force other streamers to reconsider their distribution strategies. If the theatrical model proves successful, Netflix, Apple, and Disney+ may feel pressure to expand their own theatrical releases beyond limited awards-season runs.

Additionally, Amazon’s investment in mid-budget, original films could help revive a struggling sector of the industry that has been overshadowed by franchise-driven blockbusters. With major studios increasingly prioritizing tentpoles and sequels, Amazon has an opportunity to carve out a space for original storytelling on the big screen.

Final Thoughts

Amazon MGM Studios is betting big on theaters, and its commitment to theatrical-first releases could mark a turning point in Hollywood’s evolving distribution landscape. If successful, this shift could reshape how studios approach film releases, proving that theaters and streaming aren’t competitors—they’re partners.

As Amazon continues to expand its theatrical footprint, the next few years will determine whether this strategy is a game-changer for the industry or just an expensive experiment. One thing is clear: The future of film distribution is no longer just about streaming—it’s about finding the perfect balance between the big screen and the small screen.