Audiences are slowly but surely returning to cinemas.
That’s the takeaway from AMC Entertainment’s most recent quarterly earnings report, which saw the world’s largest exhibitor post $755.6 million in revenue, a major increase from the $119.5 million in revenue that it reported in the same period in 2020. Losses for the three month period ending in September also shrunk, falling to $224.2 million, or 44 cents per share, compared to the $905.8 million, or $8.41 per share, that the company hemorrhaged in the year-ago quarter. That came at a time when COVID-19 was raging, vaccines were not available and most major studios had opted not to put any movies in theaters. This quarter was helped by the return of blockbuster films such as Marvel’s “Black Widow” and “Shang-Chi,” which helped the box office slowly rebound even if it still falls short of pre-pandemic levels.
“For the first time since the fourth quarter of 2019, substantially all of our worldwide theatres were open for the entirety of a calendar quarter,” Adam Aron, AMC’s CEO, said in a statement. “Thanks to an increasingly appealing film slate, rising COVID-19 vaccination counts, our commitment to robust health and safety protocols and our own greatly increased marketing activity, AMC’s theatres in the U.S., Europe and the Middle East safely welcomed back 40 million guests during the third quarter of 2021.”
But AMC’s shares have long ago been untethered from its business fundamentals and the company is enjoying its status as a meme stock. Like GameStop, another beleaguered company that has been embraced by social media acolytes, AMC’s stock has been on a tear. The company’s shares have increased more than 1600% over the past year and currently trade at nearly $44. Roughly a year ago, shares of AMC were trading at less than $4. Aron seems to have relished his new base of investors — on the most recent earnings call he teased a partnership with GameStop and announced the company would accept cryptocurrencies. AMC also recently announced it will start selling its popcorn in shopping malls around the country, and Aron told analysts on an investor call that he’s talking with studios about partnering with studios on non-fungible tokens (NFTs).
With the company’s increased liquidity from the higher levels of trading, Aron says he is reimagining how AMC might reemerge from the COVID era looking a little different. The idea, he argued, is to see how he can transform “…AMC into a company that does a lot more than just show movies.”
AMC’s results beat projections. Wall Street expected AMC to lose 53 cents per share on revenue of $717.1 million. Still, Aron acknowledged the movie theater circuit hasn’t quite returned to pre-pandemic attendance levels.
“We’re not yet where we want or where we need to be. The virus continues to be with us,” Aron told analysts. “We need to sell more tickets than we did in recent quarters. We are making considerable progress.”