Although certain film studios have made many terrific films after another, sometimes film studios go out of business due to having a reputation for making films that received poor reception from critics and audiences or didn't make enough money despite general success of previous films from past years. A perfect example of a studio that had a reputation for making TONS of awful films and went out of business is Franchise Pictures which made films like Battlefield Earth, 3000 Miles to Graceland and Ballistic: Ecks vs. Sever.

An example of a studio that at one time had a terrific track record, but then went downhill is Cannon Pictures, which made terrific films including the 1970 film Joe and the 1985 film Runaway Train. The company went out of business in 1994 after the release of Hellbound and due to making a string of box office failures including Cobra, Superman IV: The Quest for Peace and Masters of the Universe.