Hollywood expects to have a happy holiday season at the box office Movie theaters posted their worst attendance since 1994 last year, but Hollywood is poised for a big comeback - with the help of a secret agent, a sullen vampire and a hairy-footed hobbit. Domestic ticket sales are already up by 3% compared with the same period last year, and a bumper crop of strong films this holiday season - including movies that will appeal to both popular and discerning tastes - could push annual box office receipts above $11 billion for the first time. A strong finish to the year could ease the uncertainty gripping an industry under pressure to cut costs and boost profits, especially as revenue dwindles from once-reliable DVD sales and as more fans turn to video-on-demand and streaming to catch the latest movies. "We're still facing the same structural issues - the DVD business is declining and there are distractions for the audience - so studios have to rationalize their costs," said Stacey Snider, chief executive of DreamWorks, which is releasing "Lincoln" this weekend. But she points out: "All that doom and gloom people were talking about after the summer ticket sales didn't come to bear." Snider was referring to the anxiety rampant in Hollywood earlier this year, amid the box office flop of big-budget films including "John Carter" and "Battleship." But those disappointments have been tempered by a handful of certified hits, including "The Avengers," "The Dark Knight Rises," "The Amazing Spider-Man" and "The Hunger Games." And some movies have performed better than expected. One of those is the Iranian hostage drama "Argo," which has taken in nearly $80 million since opening Oct. 12. "I'm becoming increasingly concerned about the movie business ... there's the feeling that it could all sort of fall apart or at least be greatly diminished," said Ben Affleck, who directed and stars in "Argo." But there is a huge crop of really interesting movies coming out in the next couple of months, and I think that's great for the movie business. The latest James Bond film, the well-reviewed "Skyfall," kicks off the holiday movie season this weekend and is expected to haul in about $100 million, which would be the fourth-highest opening of the year. Next week, multiplexes across the country will be swarming with young women eager to see Kristen Stewart and Robert Pattinson in "The Twilight Saga: Breaking Dawn Part 2," the fifth and final installment of the vampire franchise. About 1,500 fans are already camped out in downtown Los Angeles for Monday night's premiere. In December comes "The Hobbit: An Unexpected Journey," a prequel to Peter Jackson's "Lord of the Rings" trilogy, which grossed more than $2.9 billion worldwide. "There's a good feeling about the business right now," said Amy Pascal, co-chair of Sony Pictures. It really looks like we have a lot of fantastic movies coming at the end of the year. In addition to the slew of big-budget films hitting theaters, an above-average array of less costly movies aimed at sophisticated filmgoers could provide a crucial assist for a box-office record: Steven Spielberg's "Lincoln" (opening in limited release this weekend), the dramedy "Silver Linings Playbook" with Bradley Cooper, a star-studded version of Broadway's hit musical "Les Misérables" and "Zero Dark Thirty," about the mission to kill Osama bin Laden. "Unlike last year, which had a very slow December, the final six weeks of this year are going to make up for that ... because of the mix of summer-style blockbusters and Oscar-bait films," said Paul Dergarabedian, president of Hollywood.com. Still, there could be some costly misses. Director Ang Lee's 3-D spectacle "Life of Pi" has earned favorable reviews in early screenings, but with a production cost of $120 million and an unknown 19-year-old lead, the holiday release is considered a big gamble for 20th Century Fox and its financial partners. "We all have a lot riding on these films, and you want people to be buying tickets," said Elizabeth Gabler, whose Fox 2000 Pictures produced "Life of Pi." But I think ... the more exciting movies you can offer people will get them to the theater. When there's a lot of energy there, that fosters excitement about the moviegoing experience. Only two films released during the fourth quarter in 2011 had U.S. ticket sales top $200 million, and the season also brought some unexpectedly expensive misses in Martin Scorsese's "Hugo" and the animated comedy "Arthur Christmas." Admissions going up is always good news. Would you like them to go up more? Of course," said Warner Bros. Motion Picture Group President Jeff Robinov. But the business is in flux - there's a diversity of choices for consumers, home video is shrinking and there's a debate over release windows. Ticket sales have been trending down since hitting the 1.57 billion mark in 2002, falling to 1.28 billion last year, the lowest in 16 years. Box office revenue, by comparison, has shown modest gains - largely because of higher ticket prices and new premiums for Imax and 3-D showings. To end the year strong, Hollywood has to score a robust holiday season, which accounts for about 20% of annual box-office receipts. "We look forward to these last six weeks of the year to really ramp up business," said Gary Dupuis, the general manager of Montana-based Polson Theatres. It's one of the better holiday seasons coming up. I think that's positive, because we are certainly still in the economy crunch where people know it's not cheap to go to the movies.