Howard Hughes bought Hollywood and sold it for profit
He inherited a drill-bit leasing fortune, spent millions on aviation records and blockbuster films, then treated a major Hollywood studio like a stock trade—walking away from RKO with millions after just seven years at the helm.
Howard Hughes Jr. inherited 75 percent of Hughes Tool Company when his father died in 1924. The elder Hughes had patented the two-cone roller bit in 1909 and leased bits rather than selling them—a shrewd model for reaching previously inaccessible petroleum. Emancipated at nineteen, young Hughes moved to Hollywood and financed films including Hell's Angels for $3.5 million and Scarface.
In 1932 he founded Hughes Aircraft Company, setting air speed records with the H-1 Racer and building the H-4 Hercules flying boat—still the largest flying boat with the longest wingspan until 2019. He acquired Trans World Airlines and later Hughes Airwest, winning the Harmon Trophy twice and the Congressional Gold Medal in 1939. Aviation historians later enshrined him among the field's great pioneers.
Hughes entered studio ownership through his tool company, gaining control of RKO in 1948 by buying 929,000 Atlas Corporation shares for $8,825,000. He dismissed 700 employees within weeks and cut output from about thirty films annually to nine. After shutting production for six months to investigate employees' political affiliations, he bought out remaining shareholders by late 1954 at a cost of nearly $24 million.
Six months later Hughes sold RKO to General Tire and Rubber for $25 million, ending twenty-five years in motion pictures. He reportedly made $6.5 million in personal profit; associate Noah Dietrich estimated $10 million from theater sales plus $1 million from seven years of ownership. RKO became known for film noir on tight budgets during his tenure. Later he expanded into Las Vegas hotels, casinos, and media before dying in 1976.
Source: Howard Hughes
