Industrial Light & Magic (ILM) has revealed that the end of the Hollywood strikes cast a powerful spell on the fortunes of its UK division as its revenues rose 2.9% to a record £94.3m in the year to September 27, 2025, fuelled by work on a string of blockbusters including Superman and Jurassic World Rebirth.
Founded in 1975 by George Lucas to create the visual effects in his original Star Wars film, the company became a division of his Lucasfilm studio, which he sold to Disney for £3bn ($4.05bn) in 2012. Although Disney releases detailed financial filings in the US, the company does not break down results for its individual businesses so their performances remain a closely-guarded secret.
It is a different story in the UK where companies are obliged to file accounts that reveal their finances. ILM opened its London office in 2014 – led by ex-Framestore execs Ben Morris and Sue Lyster, who remain at the helm – on the back of a surge in UK production due to improvements in the country’s incentives scheme. As of last year, the scheme offers films and high-end TV shows an enhanced VFX relief at a net rate of 29.25%, compared to 25.5% for other production costs; VFX costs are also not subject to the standard 80% cap on qualifying expenditure.
ILM’s latest set of accounts were filed on Companies House last week and state that the increase in its revenues was “driven by strong demand for project activity including from the ending of the Screen Actors Guild strikes”.
Films and series made by US studios paused all over the world when writers and actors went on strike for a total of six months until November 2023, stalling the production pipeline. When the impasse finally ended, ILM was in a strong position to capitalise on renewed production activity as a division of Hollywood’s consistently highest-grossing studio, but also working on other studio projects. Disney’s long-term deal to occupy most of London’s Pinewood Studios has seen it shoot all of the Star Wars features there as well as several Marvel movies.
ILM worked on the majority of these franchise titles, helping to fuel a fourfold increase in revenues for its UK division over the past decade. (To accommodate its expansion, the company relocated in 2017 from its original Shaftesbury Avenue headquarters to a 50,000-sq-ft space in the Lacon House development near Holborn.)
The company’s bottom line isn’t as rosy, however. In 2024, it banked £3.1m in research and development expenditure credits but this fell sharply to just £783,000 last year, dragging down its pre-tax profit by 36% to £9m. The company’s biggest single cost is paying staff and last year it took on 55 new employees in the UK, giving it a total of 726. The vast majority of the new additions were artists who helped ILM deal with the increased workload.
Stark contrast
ILM’s growth comes at a turbulent time for the UK VFX industry, which has been rocked by a series of closures amid a production slowdown, intense competition and cost pressures.
VFX giant MPC, which had been a key Disney supplier, closed its doors last year after parent company Technicolor fell into administration, as did sister commercials facility The Mill. Leading visual-effects houses Jellyfish Pictures and Glassworks also closed their doors last year. In March, Sony announced it was closing its VFX studio Pixomondo, which had bases in cities including London, while commercials VFX house Absolut also closed its doors this month.
ILM’s strong performance also stands in stark contrast to the approach at Disney’s Marvel Studios, which laid off nearly all of its award-winning visual development team last month as part of a company-wide restructuring that eliminated around 1,000 jobs. The cuts affected the highest echelons of the studio with executives, department leads and long-time concept artists departing. They even included director of visual development Andy Park, who had been with the studio for 16 years and was widely credited as being one of the key architects of the Marvel Cinematic Universe’s visual identity.
There was no belt-tightening at ILM in the UK as the recruitment drive pushed up total staff costs by 12.7% to £64.4m. And there are multiple ongoing UK-based productions to keep them busy. Projects that have shot recently in the UK on which ILM has been involved in either a lead or supporting capacity for their VFX include Avengers: Doomsday, Spider-Man: Brand New Day, Andor season two, Supergirl and Masters Of The Universe.
With Gower Street Analytics forecasting a 3.3% increase in the global box office to $34.7bn, and several of these titles expected to be driving forces on the 2026 release calendar, ILM looks in a strong position to continue its robust performance in the UK.
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