I'm sure it's relevant to the people managing the operating budget. If the show does better, they can afford to spend more on future productions or other activities, and/or don't have to push so hard to raise funds outside of ticket costs. If it does poorly, the company has to cut expenses, shows, press for more donations, or cease operating.
I'm sure you're criticizing the OP's use of "flopping" outside it's specific definition of not returning an investor's capital, but in the sense of the financial success of the production, it's entirely relevant. It IS entirely irrelevant to this conversation and the OP's question. The show doesn't do well - the COMPANY does well. With factors like subscriptions, donations, government and private grants, and additional revenue-producing activities, it is impossible for us to say whether the show is doing well by looking at the grosses.
For example, while Lincoln Center had SOUTH PACIFIC running, their other shows could all run at a loss because all the profit from SOUTH PACIFIC could help run it, so the company was making money and all their shows were doing well, from a financial standpoint.
A commercial producer does not have that luxury. Even if he has multiple shows on Broadway at the same time, he cannot legally take the profits of one show to cover the losses of another. That is why we can judge the financial success of a commercial show by looking at the grosses.
Nothing matters but knowing nothing matters. ~ Wicked
Everything in life is only for now. ~ Avenue Q
There is no future, there is no past. I live this moment as my last. ~ Rent
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