It’s a bad day to be a movie theater.
Warner Bros.’ announcement on Thursday that it will release its entire 2021 movie slate on HBO Max at the same time the films open in cinemas sent exhibition industry stocks tumbling.
Cinemark fell more than 21%, Imax slid more than 7.3% and the Marcus Corporation fell more than 11%. AMC started out the day with its stock being pummeled after it announced it was selling 200 million shares in a bid to raise $844 million and improve its liquidity. The big Warners news didn’t help the situation. AMC’s stock was down more than 17% on Thursday afternoon. National Cinemedia, which sells pre-show advertising that appears on movie theater screens, also got walloped — its stock fell 6.8%.
The exhibition sector has been decimated by the coronavirus pandemic. Cinemas were forced to stay closed for much of the spring and when they attempted to reopen in the summer with the release of “Tenet,” audiences failed to come back in big numbers. The concern is that by making movies such as “Dune” and “Matrix 4” available to HBO Max subscribers at the same time they hit theaters, audiences will continue to steer clear of cinemas, particularly during a public health crisis.
Warner Bros. says the move is a temporary solution to an unorthodox situation. These movies can’t screen in major markets such as New York City and Los Angeles, where cinemas are still closed, making a traditional theatrical release potentially ruinous.
Other studios have experimented with different distribution plans during the pandemic. Disney moved “Mulan” and “Soul” to its streaming service Disney Plus, while Universal is releasing “The Croods: A New Age” and “News of the World” in theaters for 17 days before debuting them on premium VOD.