How Sony Lost Out on the Best Film of 2025

Usually, when you’re assessing the best film of the year, you’re looking at box office takings. 2025 is different, though, because of the success of KPop Demon Hunters – an animated movie that streamed on Netflix, and that only had a box office at all because the streaming giant chose to release a singalong version in theaters. This grossed $24.6 million in just over five days, which is of course all profit for a film Netflix never originally intended to show on the big screen at all.

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In a first for Netflix, KPop Demon Hunters snagged number one in the North American box office. HUNTR/X girls really did rule the world, with Netflix confirming it was the most popular Netflix film of all time, while seven films from the soundtrack dominated the Billboard Hot 100 for months. The film has earned three Golden Globes nominations: Best Animated Motion Picture, Best Cinematic and Box Office Acheivement, and Best Original Song from a Motion Picture. And yet, here’s the remarkable thing; far from being a hit for Netflix, should have been Sony’s triumph.

Why Sony Missed Out on KPop Demon Hunters

The story of KPop Demon Hunters goes back to 2021, when Sony bosses considered how to react to the pandemic. Theaters were still recovering, and box office takings were unpredictable. Sony’s competitors had shifted to digital or hybrid releases, but Sony lacked a streaming service, so a deal with Netflix made sense. According to industry insider Matt Beloni for Puck News, the company signed a “Pay One” output deal with Netflix for its theatrical releases. The streaming giant was offered a first look at certain projects and the ability to greenlight them, with Sony paid pre-negotiated premium on top of the budgets.

According to Beloni, this premium was capped at 25% of the budget. For KPop Demon Hunters, that meant Sony was paid an additional $25 million on top of the $100 million budget – meaning the film studio made just $25 million profit for the biggest film of 2025. Netflix officially owns the IP rights, and has signed contracts with Sony to produce a sequel; but that, too, will continue to sit on Netflix, with theatrical releases as a bonus.

It’s easy to criticize Sony for this decision, but hindsight is an exact science. Sony’s Netflix deal made perfect sense at the time, guaranteeing income for the studio while the global box office recovered from COVID. As Beloni notes, the deal included a mandate to buy selected movies that were never intended for theatrical release at all, such as Lady Chatterley’s Lover and People We Meet on Vacation. This seemed like a smart call in the short-to-medium term, even if it has backfired four years later.

Would KPop Demon Hunters Have Been As Big at the Box Office?

Speaking at the Bank of America conference in September, Sony Pictures CEO Ravi Ahuja admitted the studio missed its shot with KPop Demon Hunters. “Obviously, in hindsight, it’s such a big hit,” he admitted. “It’s K-Pop-themed, very specific film. Netflix paid the whole cost, plus a profit premium. At the time, it made sense. But now you look at the success and think maybe it could have been theatrical.” That said, it’s hard to prove a counterfactual; industry insiders told Beloni they suspected the film flourished precisely because of streaming.

“Original animation has struggled in theaters post-Covid, and with the exception of the SpiderVerse films, the edgier, anime-style look and feel of Demon Hunters typically does not resonate with a broad theatrical audience, especially in this country.”

The argument is simple; that Netflix films appeal to an audience who don’t typically turn up at theaters, and that these are the viewers KPop Demon Hunters appealed to. If this is right, then this became the film of the year precisely because of Netflix, and would have been much smaller had it released on the big screen. For Netflix’s Ted Sarandos, KPop Demon Hunters is likely the proof he’s right that modern viewers want to watch movies at home, not at theaters (an argument that worries the industry now Netflix is in the running to buy Warner Bros.).

At the same time, though, this misses the fact that KPop Demon Hunters is a success in its own right – a hit because it deserves to be a hit, because it’s been made with skill and care, features stunning musical numbers, delightful animated sequences, and strong characterization. It’s true that no film is a guaranteed hit, but a good marketing campaign should have meant KPop Demon Hunters performed well in the box office. It would have naturally garnered good word-of-mouth, meaning it had long legs. It may not have been quite as big, but it would likely have been a success all the same.

This is, of course, only a “what if.” In reality, Sony missed out on the film of the year, and Netflix gained another massive franchise in the same year the billion-dollar hit that is Stranger Things has come to an end. For Netflix, the timing couldn’t be better, and the streaming giant is working hard to translate KPop Demon Hunter‘s success into a long-lasting franchise.

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