Beyond movie screenings: Chinese cinemas embrace diversified business models to drive new growth

China's summer movie season is heating up. With a string of new releases, including Kung Fu Soccer and All Wishes Come True hitting theaters, students and family audiences have become a major source of traffic during the summer holiday.

Data from online platforms showed that as of 3:40 p.m. on July 28, the total box office revenue of China's 2026 summer movie season, including presales, had surpassed 6 billion yuan ($886.7 million). With cinemas seeing a surge in audiences, they are exploring new ways to expand beyond traditional film screenings and create more immersive, multi-purpose entertainment spaces.

In Beijing's Wukesong area, a weekend "food street" event has turned the local cinema into one of the most popular spots in the surrounding commercial area. Moviegoers can enjoy free local delicacies by presenting their cinema purchase receipts, with long lines forming at many food stalls.

At another cinema in Beijing's Tongzhou District, a family activity themed around All Wishes Come True is attracting many young audiences. Every day, dozens of children sit together to draw characters of the animation under the guidance of teachers and learn about the mythology behind the animation.

Beyond painting activities, the cinema regularly organizes film-related handicraft workshops. Priced under 100 yuan, the packages include both hands-on experiences and a movie screening. Some parents have signed up with their children multiple times.

One parent told China Media Group (CMG) that it's the fourth time their child has participated in the handicraft activity.

In Shanghai, the SFC Animation-themed Cinema, China's first animation-themed theater, brings four major domestic animation IPs to life by recreating their iconic scenes and signature props. Powered by technologies such as holographic projection and naked-eye 3D, the venue transforms classic animated moments into immersive, interactive experiences that allow visitors to step into the worlds of their favorite characters.

Smaller cinemas find new opportunities

Aside from big cities, smaller cities are also finding new growth opportunities through more personalized and high-quality services.

According to the 2026 China Film Market Research Report for the first half of the year, China had 13,400 operating cinemas. Small and medium-sized cinemas accounted for an increasing share, especially in county-level markets, where they have become the dominant format.

Unlike large cinema complexes in first- and second-tier cities, many county-level and smaller cinemas are positioning themselves as community cultural hubs by creating warmer, more diverse spaces that integrate entertainment, leisure and social interaction.

For example, Wanxiang Cinema in Kunshan City, east China's Jiangsu Province, has introduced a self-service library and trendy toy zone to make use of audiences' waiting time. By combining moviegoing, reading and entertainment, the cinema has created a more flexible social space.

"Since upgrading our business formats, revenue from non-box-office sources has increased by about 15% year on year, while daytime weekday traffic has risen by around 20%," said Wang Yan, manager of Wanxiang Cinema.

At a cinema in Xinxiang City, central China's Henan Province, management has launched film-themed bead art workshops, allowing visitors to create movie-related crafts and participate in social media check-in activities to redeem free tickets.

"Bead art is very popular among local teenagers and children. Since family audiences are concentrated during the summer holiday, we combined handicrafts with popular film IPs by designing exclusive patterns based on movie characters and scenes," said Zhang Yuwei, manager of the cinema in Xinxiang.

"The activity is quite innovative," a parent named Zhang Xiufen told CMG. "Children can not only watch movies but also learn about history through them. Combining films with bead art is a great idea."

Making better use of idle spaces and off-peak hours

For cinema operators, seasonal fluctuations and uneven audience flows between weekends and weekdays have long been operational challenges. Diversifying business is not simply about adding more services, but also about using idle spaces and time slots more efficiently.

This summer, many cinemas have transformed unused halls and public areas into new attractions, introducing XR immersive experiences, film-themed summer camps and other activities.

"XR immersive experiences do not compete with traditional movie screenings. Instead, the two can complement each other, bring in more visitors and increase overall revenue," said Yin Yongchao, manager of a cinema in Xinxiang.

In Kunshan, some cinemas have upgraded underused areas into new recreational spaces. Taking advantage of spacious interiors, a cinema has introduced indoor rock climbing and launched combined packages linking movie tickets with climbing experiences.

"Weekday daytime hours usually have a relatively high vacancy rate, so introducing activities like rock climbing helps improve space utilization and diversify our revenue structure," said Xu Gui, manager of the cinema. "Through cross-sector cooperation, we can create new cultural and social spaces for young people."

Some cinemas are also adopting flexible time-based operations for multi-purpose halls, such as hosting birthday parties, small salons and corporate team-building events. Spaces that were previously only used for screenings can now serve multiple functions throughout the day, helping fill gaps in off-peak traffic.

Driven by the "ticket economy," China's film-related industries have continued to expand. Industry estimates show that the total output value of China's film industry chain exceeded 310 billion yuan in 2026, highlighting the growing potential of cinemas as comprehensive cultural and entertainment spaces rather than simply places to watch movies.