Disney has finally said what the box-office numbers had already suggested: The Mandalorian and Grogu did not perform as well as the company expected in theaters.

The admission appears in Disney's Q3 FY2026 shareholder letter. Disney said the movie received strong audience scores but fell below its box-office expectations. The company used the same wording for its live-action Moana. It did not call either movie a flop, and the distinction is important. This was a disappointing theatrical result by Disney's own standard, not proof that audiences suddenly stopped caring about Star Wars or Grogu.

The Mandalorian and Grogu opened in May with Pedro Pascal returning as Din Djarin and Grogu joining him on the big screen. For fans who had followed their story on Disney+, the movie was the first chance to see the pair lead a theatrical Star Wars release. The move also tested whether a streaming hit could convince a large number of subscribers to pay for tickets.

The Mandalorian holding Grogu in an official movie image
Disney says the film earned strong audience scores, but its theatrical performance missed expectations. Image: Lucasfilm/Disney.

The Opening Was Solid, but Not Big Enough

The Associated Press reported an estimated $82 million for the movie's first three days in North America and a projected $102 million across the four-day Memorial Day weekend. Its worldwide opening reached about $165 million. Those figures would look strong for many releases. For a new Star Wars movie from Disney, they landed near the lower end of the franchise's modern theatrical openings.

The reported production budget was also around $165 million before marketing. A movie does not have to earn back its budget during opening weekend, but studios usually want an expensive franchise release to keep drawing large crowds for several weeks. Disney's statement tells us the final result did not reach the number it had planned for.

The result carried extra pressure because this was the first new Star Wars movie in theaters since The Rise of Skywalker in 2019. Disney had spent years keeping the franchise active through streaming series while it reconsidered its film schedule. Returning with two characters people already loved looked like a safer choice than introducing a completely new cast.