×
You will be redirected back to your article in seconds

MoviePass Parent’s Stock Plunges After Warning on Growth Reduction

The stock of MoviePass’ parent company Helios & Matheson has lost 31% of its value after warning that the subscription service may be forced to reduce future growth.

Tuesday’s decline came following a Securities and Exchange Commission filing by Helios & Matheson. The company disclosed it had $15.5 million in available cash at the end of April, plus $27.9 million on deposit with merchants while current monthly expenses are about $21.7 million.

The filing said that if adequate funding, either through an existing equity distribution agreement or other sources doesn’t materialize, “We may be required to reduce the scope of our planned growth or otherwise alter our business model, objectives and operations, which could harm our business, financial condition and operating results.”

Shares were down 66 cents to $1.45 in trading on Tuesday.

MoviePass announced on May 2 that it would again allow customers to sign up for its popular movie-a-day monthly subscription package after briefly taking the offering off of its website. An independent auditor publicly raised questions last month about the service’s ability to continue operating.

The company pays movie theaters full price for the tickets its customers buy, so it is essentially subsidizing their movie-going at a loss to its own bottom line. MoviePass claims that it will eventually be able to monetize its more than two million subscribers by running ads, partnering with theater chains, or figuring out a way to make a profit on the data it collects on its users.

“In 2018, we expect our cash deficit from month to month will vary significantly,” Tuesday’s filing said. “Based on the amount of movie tickets MoviePass is required to purchase for its subscribers during the month, the amount we spend on acquiring financial interests in additional movies through MoviePass Ventures, the amount we may spend on any other types of acquisitions, and our ability to develop the MoviePass business model in the near term generally, including developing and growing sources of revenue other than subscription revenue. Because the length of time and costs associated with the development of the MoviePass and MoviePass Ventures business model is highly uncertain, we are unable to estimate the actual funds we will require.”

POPULAR ON VARIETY:

More Film

  • Midnight Traveler review

    Film Review: 'Midnight Traveler'

    Refugees rarely get to tell their own stories, which means their stories get told for them — often inaccurately and with undue hostility. Lack of resources is one issue, but a lack of stability is another: Asylum-seekers are in a frightening state of limbo, fleeing the imminent dangers of their native countries only to suffer [...]

  • WGA Authorizing Managers, Lawyers to Make

    WGA Authorizing Managers, Lawyers to Make Deals if Agents are Fired

    The Writers Guild of America has authorized managers and lawyers to negotiate deals for writers in place of agents — if the guild tells members to fire their agents on April 7. The guild’s negotiating committee notified members of the plans in a message Wednesday. The WGA and the Association of Talent Agents having made [...]

  • Gone With the Wind Screening

    Film News Roundup: 'Gone With the Wind' Sets Event Cinema Record

    In today’s film news roundup, “Gone with the Wind” sets a new record, “Fiddler: A Miracle of Miracles” is acquired, and Tracy Oliver signs with Topic Studios. EVENT CINEMA RECORD The 80th anniversary release of “Gone with the Wind” has grossed $2.23 million in six nationwide screenings on four dates — a record as the [...]

  • Made in Abyss - Journey’s Dawn

    Film Review: ‘Made in Abyss: Journey’s Dawn’

    It’s a Herculean effort to take a multi-volume manga like author Akihito Tsukushi’s “Made in Abyss,” adapt it into a popular anime television series, and then compress the show into a coherent feature (technically, two movies), but the folks at Sentai Filmworks have done just that. Part one, “Made in Abyss: Journey’s Dawn,” will screen [...]

  • HAF: 'Assassination,' 'Apprenticeship' Named Project Market

    HAF: 'Assassination,' 'Apprenticeship' Named Project Market Winners

    Eighteen prizes were presented on Wednesday afternoon at the closing ceremony of the Hong Kong Asia Film Financing Forum. The project market sits alongside FilMart as part of the Entertainment Expo in Hong Kong. “Wong Tai Sin Assassination” to be directed by Wong Hoi and produced by Derek Kwok Tsz-kin, was named the winner of [...]

  • Contract Placeholder Business WGA ATA Agent

    Writers Guild Makes Concession on Film Financing in Agent Talks

    The Writers Guild of America has made a concession in film financing in its negotiations with Hollywood talent agents — the second in six weeks of talks. WGA West executive director David Young said Wednesday that it had made a “significant move” toward reaching a deal with the Association of Talent Agents for a revamped [...]

  • Noah Centineo He-Man

    Noah Centineo to Play He-Man in 'Masters of the Universe' Reboot

    From a boy (who’s loved) to He-Man. Noah Centineo is in talks to take on the superhero in Sony Pictures and Mattel Films’ “Masters of the Universe.” Brothers Adam and Aaron Nee are directing the reboot. Mattel Films is partnering with Sony on the movie, which is based on Mattel’s beloved toy line that spawned [...]

More From Our Brands

Access exclusive content