Disney has revealed that it has spent $141.3 million (?110.6 million) on pre-production and filming of the second season of its Loki streaming series as it attempts to reinvigorate its struggling Marvel Studios division after a string of critical and commercial failures.

No expense has been spared on Loki Season 2 which cost more in pre-production and filming than many big screen Marvel movies including Doctor Strange (?102.7 million), Thor 2: The Dark World (?99.4 million) and Guardians of the Galaxy (?91.1 million).

Due to debut on the Disney+ platform in October, the sequel to the hit 2021 series stars Tom Hiddleston as the eponymous Asgardian god of mischief. He is joined by Owen Wilson and a new addition to the cast, Oscar-winning Indiana Jones actor Ke Huy Quan who team up to stop a time-travelling conqueror called Kang.

Fans got their most-detailed look yet at the series on Monday when Disney released the first trailer for Season 2 which shows Hiddleston’s character phasing in and out of existence.

Tom Hiddleston is returning as Loki when the new season is released later this year


Quan’s role has been particularly well-received with one fan gushing that “this is the greatest thing to ever happen. I adore this man”. Another described it as “like seeing an old friend. It is comforting to see him on screen.” One fan even went as far as to say that Quan is reason enough for tuning in. “I was on the fence on watching Loki season 2 but I saw that Ke Huy Quan is in it and yeah…I’m definitely watching that.” It is more than can be said for most of Marvel’s productions this year.

The studio kicked off 2023 with Ant-Man and the Wasp: Quantumania, a sci-fi film which opened in February and introduced the Kang character. Its domestic debut weekend box office of $106 million was the highest in the Ant-Man trilogy but then it fell by 70%, resulting in the biggest second-weekend drop in the franchise’s history. The movie ended up grossing $476.1 million worldwide which was lower than both of its prequels. As we revealed, Disney spent $193.2 million on pre-production and filming alone.

The movie was widely derided for its Computer Generated Imagery (CGI) and one month after its release Marvel unexpectedly fired its president of physical and post-production, VFX and animation production, Victoria Alonso. She had been with Marvel from the start, 18 years ago and some saw her as a scapegoat for the studio’s struggles, especially given the fierce criticism of Quantumania’s VFX. However, Alonso was reportedly actually fired for promoting the historical drama she produced, Argentina, 1985. She reached a multi-million Dollar settlement with Marvel in April so the exact circumstances of her departure may never be known.

Ant-Man and the Wasp: Quantumania was widely criticised for its CGI Photo courtesy of Marvel … [+] Studios. (C) 2022 MARVEL.

Courtesy of Marvel Studios

Just days after her departure, Marvel was rocked again when Kang actor Jonathan Majors was arrested on assault and harassment charges. He denies them and will get a chance to explain why when he goes on trial this month.

In May Marvel lifted the curtain on Guardians of the Galaxy Vol. 3 which missed estimates with an opening weekend gross of $118.4 million compared to a projected $120 million. With total ticket sales of $845.3 million, it isn’t as successful as the first instalment in the series but is still solidly in the black. However, even this was bittersweet as it marked the last Marvel movie of the brainchild behind the Guardians series, James Gunn, as he left to head up arch-rival DC Studios.

Guardians of the Galaxy Vol. 3 was a rare recent success for Marvel (C) 2023 MARVEL.

Courtesy of Marvel Studios

Then came Secret Invasion. Disney had high hopes for the streaming series which launched in June and was based on a beloved comic series about a race of shape-shifting aliens secretly invading the corridors of power. However, its serious tone, gaping plot holes and poor CGI put off fans leading to its crescendo becoming the single lowest-rated episode of any Marvel series with just a 7% score on Rotten Tomatoes.

As we revealed, staggeringly, it had a budget of $211.6 million. It explains why Disney’s chief executive Bob Iger said in February that the studio needs to “reduce costs on everything that we make because, while we’re extremely proud of what’s on the screen, it’s gotten to a point where it’s extraordinarily expensive.”

A total of 7,000 job cuts and $5.5 billion of cost-savings followed, but even that wasn’t enough. Just last month, Iger told CNBC that Disney is slowing down when it comes to making movies and streaming series for its Marvel and Star Wars franchises. “You pull back not just to focus, but also as part of our cost containment initiative. Spending less on what we make, and making less,” he said.

Season 2 of Loki was given the green light long before these comments and before Iger even returned to the helm of Disney in November last year. It shows.

The series was filmed at the historic Pinewood Studios just outside London as well as on location across the UK capital. It’s a far cry from tinsel town and this shines a spotlight on the otherwise secretive cost of film-making.

Budgets of streaming shows are usually confidential as studios combine the cost of them in their overall expenses and don’t itemise how much they spent on each one.

Shows made in the UK are an exception. They benefit from the government’s Television Tax Relief scheme which allows studios to claim a cash reimbursement of up to 25% of the money they spend in the country.

To qualify, shows must pass a points test based on factors such as how much filming was done in the UK, the level of UK content and how much they promote UK heritage. Furthermore, at least 10% of the core costs of the production need to relate to activities in the UK and in order to demonstrate this to the government, studios set up a separate Television Production Company (TPC) there for each picture.

These TPCs have to file publicly-available financial statements showing everything from the headcount and salaries to the total cost of the production and the amount of cash they have got back.

The UK government’s regulations state that each TPC must be “responsible for pre-production, principal photography and post-production of the television programme; and for delivery of the completed programme.” Accordingly, there is no doubt that their financial statements show all of the costs of each series. It isn’t even possible for studios to hide costs in other companies as the law also states that “there can only be one TPC in relation to a programme.”

The companies usually have code names so that they don’t raise attention when filing for permits to film on location. The Disney subsidiary behind Loki Season 2 is called Limbo Productions I UK in a nod to title character’s transient status. Its first set of financial statements were filed on Sunday and cover the 18-month period to October 31 2022 which is when filming wrapped.

They reveal that the company was handed a $27.9 million (?21.8 million) reimbursement bringing its net spending down to $113.4 million which is still far from small beer. The colossal cost dates back to the peak of the pandemic when much of the world was locked indoors addicted to streaming content. Disney was eagerly adding shows to its streaming platform in a bid to attract more subscribers than its rivals.

Development of Season 2 had reportedly begun by November 2020, just before filming on the first series wrapped. Enthusiasm for it, and the potential for a sequel, wasn’t misplaced. When the first series premiered in June 2021, Disney’s then-chief executive Bob Chapek claimed that it was “the most watched premiere on Disney+ during its opening week.”

Season 1 of Loki was the most-watched Marvel TV show to date on Disney+ (C)Marvel Studios 2020. All … [+] Rights Reserved.

Courtesy of Marvel Studios

According to industry analysts Samba TV, Loki’s first episode was watched by 2.5 million households in its first five days giving it a higher audience than any of Marvel’s other streaming shows – a record which stands to this day. The streaming bubble has long since burst thanks to the easing of the pandemic and pure strings being pulled due to rising inflation. However, Season 2’s budget could be more important now than ever. Disney doesn’t just need it to succeed in order to give a glow to Marvel but to its entire streaming platform.

Unlike theatrical releases, which share ticket sales between studios and exhibitors, Disney receives all of the revenue from its streaming platform. Subscribers pay a single fee which grants them access to all of its new content throughout the year, with or without advertising depending on how much they pay. This makes it impossible to calculate how much subscription revenue is generated by each streaming show.

Instead, the total costs of the shows are deducted from the total revenue to determine whether the platform overall made a profit or a loss. The more subscribers it has, the higher the revenue and the greater the potential for profit. However, Disney wisely changed its goal of chasing subscribers in light of the bleak economic backdrop. Its aim now is to reduce the cost of the programming which also gives a greater potential for profit. It is badly needed.

Disney+ hasn’t made a profit since it was launched in 2019 and made an operating loss of $659 million in the first quarter of 2023 alone. Disney has assured investors that the platform will be profitable by the end of its 2024 fiscal year and time will tell whether Loki Season 2’s blockbuster budget is a help or a hindrance to that.

 Disney has revealed that it has spent $141.3m on pre-production and filming of the second season of its Loki streaming series as it attempts to reinvigorate its struggling Marvel Studios division.  Read More