James Cameron: Avatar 2 needs to be 3rd or 4th highest grossing in history to break even

James Cameron says 'Avatar: The Way of Water' will have to be the "third or fourth highest-grossing film in history" just to break even.

The 68-year-old director admits his forthcoming movie, the hotly-anticipated follow up to 2009's 'Avatar' - which is due to drop next month - was "very f******" expensive to make, and he has described the motion picture as the "worst business case in movie history".

Speaking about how the film could be profitable, he said: "You have to be the third or fourth highest-grossing film in history.

"That’s your threshold. That’s your break even."

The franchise's four sequels have an expected budget of around $1 billion.

Cameron admitted he is attracted to "difficult" projects.

He added to GQ magazine: "I like difficult. I’m attracted by difficult. Difficult is a f****** magnet for me. I go straight to difficult.

"And I think it probably goes back to this idea that there are lots of smart, really gifted, really talented filmmakers out there that just can’t do the difficult stuff.

"So that gives me a tactical edge to do something nobody else has ever seen, because the really gifted people don’t f****** want to do it."

Earlier this month, Cameron admitted the 'Avatar' franchise could be "done in three months" if the sequel isn't a success.

He said: "The market could be telling us we’re done in three months, or we might be semi-done, meaning, 'OK, let’s complete the story within movie three, and not go on endlessly,' if it’s just not profitable.

"We’re in a different world now than we were when I wrote this stuff, even.

"It’s the one-two punch – the pandemic and streaming. Or, conversely, maybe we’ll remind people what going to the theatre is all about. This film definitely does that. The question is, 'How many people give a s*** now?' "

Cameron also admitted the franchise has been "hideously expensive" to make, but insisted the upcoming film will deliver "three hours of a pretty much insane experience".

He added: "There are a couple of things that I took out [of 'The Way Of Water'] that I want to shoehorn into movie three, hopefully.

"These are hideously expensive movies. It was a sketchy business case before the pandemic to make a movie that cost this much.

"At this point, we just have to play it out to see what happens. But what I know right now is: we’re delivering three hours of a pretty much insane experience."