Frozen 2 grossed over $1.4 billion worldwide, Disney sequels were often much smaller movies. But as a whole, those straight-to-video sequels made over $2 billion in their first decade alone. The thing is, most of these sequels weren't produced by Walt Disney Animation Studios; instead, those movies were originally made by the now-defunct Disneytoon Studios, which produced almost all of Disney's straight-to-video sequels.
Director Tad Stones at Disneytoon Studios first pitched the idea of a straight-to-video sequel for Robin Williams, who declined to return as the genie. Despite continued poor reviews, Disney released dozens of sequels and prequels (not including spinoffs, shorts, or TV shows) only on VHS and DVD between 1994 and 2018. In an interview, Stones said that Disney CEO, Michael Eisner, and head of Feature Animation, Peter Schneider, both initially opposed the idea of making sequels, saying, "...their quality hurts the Disney reputation" (AWN). That is until they learned how much money these sequels could make.
The production cost of Aladdin was $28 million, but it grossed over $500 million worldwide, making it the highest-grossing film of 1992. Return of Jafar raked in $300 million, but its cost to produce was a meager $3.5 million. The Lion King II: Simba's Pride each have similar profit margins. The Lion King grossed $766 million worldwide and had a production cost of $45 million. The pre-production for Lion King II was done by Walt Disney Animation Studios, which likely increased the budget, but Lion King II made a stunning $300 million in home video sales. Little Mermaid II: Return to the Sea and Lady and the Tramp II: Scamp's Adventure reportedly both made over $100 million. Mulan II generated at least $60 million, though it's unclear whether this number refers to domestic or worldwide sales. All of this convinced Disney to eventually make theatrical sequels to their biggest movies, an endeavor that has seen success with Ralph Breaks the Internet and Frozen 2.
Disney’s straight-to-video sequels used cheaper production methods, hired less expensive voice actors, and re-used material. But perhaps the most egregious shortcoming of these films is that they often relied on the regression of their characters to tell their stories - this is something the theatrical sequels don't share as they're natural continuations of the original films, both story- and production-wise. For example, Mulan II and The Hunchback of Notre Dame II are among the worst offenders of regressing. The heroes either became one-dimensional caricatures of themselves or acted out of character altogether. There are standouts (Lion King 1 ½, Lion King II, Cinderella III: A Twist in Time and Aladdin and the King of Thieves each have a smattering of loyal fans), but Disney’s straight-to-video sequels are almost universally considered the worst films produced by the company.
Despite the reputation garnered by straight-to-video sequels, Disney found sequel success with Pixar. Four of Disney’s top 10 highest-grossing animated films are now sequels. Three of those divisive “live-action” remakes of Disney classics likely won’t end anytime soon, Disney seems to have finally figured out the formula for a profitable, memorable, and charming animated sequel.
