Spielberg is not struggling to have a film land in theaters and neither is PTA. Small release films exist.

You're ignoring the main factor which is the lack of control for PTA. Why would he choose this over doing his own movies? He still gets funding to make the character based dramas he's always made. Why blemish his filmography with a Karate Kid movie? Why would he randomly swerve into this lane for no apparent benefit?