AMC Entertainment, the exhibition giant that became an improbable meme stock, posted revenues $1.2 billion during the holiday quarter as “Spider-Man: No Way Home” galvanized ticket sales at the company. That Q4 performance, revealed Tuesday by AMC, represented a huge jump from the $162.5 million in revenues that AMC posted in the year-ago period and marked the best quarter for the company in two years.
Comparisons are tricky, because vaccines at that time were not readily available and there were few studio films debuting exclusively in theaters.
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The company had 60 million guests visit theater locations globally in Q4, AMC chairman and CEO Adam Aron said during the company’s earnings call Tuesday. Aron shot down industry speculation that the theatrical business would be unable to recovery from the COVID-19 pandemic: “What a load of cow dung.”
Looking forward, Aron noted that AMC is experimenting with variable pricing, charging “slightly higher” prices for tickets to Matt Reeves’ “The Batman” this weekend than it is “for other movies playing in the same theaters at the same time.”
“This is all quite novel in the United States, but actually, AMC has been doing it for years in our European theaters,” Aron said. “Indeed, in Europe, we charge a premium for the best seats in the house, as do just about all other sellers of tickets in other industries — think sports events, concerts, and live theater, for example.”
Per AMC, at the end of 2021, the company had opened and was operating 593 domestic theaters and 337 international theaters, representing 100% and 95% of its domestic theaters and international theaters respectively. Substantially all AMC’s theaters were open for all of Q4.
“The problem with conventional wisdom is that conventional wisdom is often just utterly wrong,” Aron said. “Remember the breathless reporting that AMC would file for bankruptcy in 2022? Wrong.”
Aron said that, as of Q4, 90% of AMC’s investors were retail shareholders.
“For the first time in 2 years, at the end of Q4, AMC generated positive cash flow,” Aron noted, later saying of the skeptics: “They were wrong. They were wrong. They were wrong.”
AMC has played to its fanbase with some of its recent initiatives, announcing that it would accept Bitcoin and start selling its popcorn in malls. Aron revealed during the call that AMC plans a co-branded credit card launch as a “priority” for this year. The company also hopes to launch its popcorn-delivery service through Uber Eats in the second quarter.
Wall Street forecast earnings per share (EPS) of 26 cents on $1.2 billion in revenue, according to analyst consensus data provided by Refinitiv. AMC actually reported $1.17 billion in revenue and an adjusted diluted earnings loss of 11 cents per share. That earnings loss has decreased from AMC’s year-ago Q4, when it reported a loss of $3.15 per share.
AMC posted a net loss of $134.4 million for Q4. That compared favorably to a net loss of $946.1 million in the year-ago period. The company’s shares have been on a wild ride, reaching a high of $72.62 in June as a passionate social media fanbase sought to goose the stock. The gravitational pull of business fundamentals has been impossible to fully resist. AMC stock was trading at $18.32 per share at close Tuesday and many investors and analysts have worried about the exhibitors debt load and changing consumer habits which favor streaming over theatrical releases. Other meme stocks such as GameStop have experienced similarly volatile trading.
AMC ended 2021 with $1.8 billion in liquidity and $1.6 billion in cash and cash equivalents.
“The fourth quarter of 2021 proved once again that moviegoers want to see movies in theaters,” Aron said in prepared remarks that accompanied AMC Entertainment’s earnings release Tuesday. “We are quite bullish that for the full calendar year of 2022 the industry box office could be nearly double that of 2021, with COVID impacts easing, with more and more major films on the docket for release, and with most major studios coalescing around an exclusive theatrical window of 45 days or more. Bookings are very strong for THE BATMAN which opens this weekend, and we have movies like ‘Top Gun: Maverick,’ ‘Jurassic World Dominion,’ ‘Black Panther: Wakanda Forever,’ ‘Avatar 2’ and many others that will excite us all this year. We should point out, however, that the box office pacing and our results in 2022 are expected to be heavily weighted towards the second half of the year. The January and February domestic industry box office numbers are already known. While they are more than quintuple that of last year, they are nonetheless well short of pre-pandemic numbers. While no one has a perfect crystal ball, it would seem that more blockbuster activity likely will come starting in the spring and summer of 2022, continuing through year-end.”
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