AMC Entertainment Sees a ‘Multi-Year Recovery’ for Box Office

The theater chain says its fourth-quarter revenue improved slightly from third quarter, but lack of hit films outside “Avatar” and “Black Panther” sequels leads to 15% year-over-year drop

AMC Earnings
Photo illustration by TheWrap

Like the rest of the movie theater industry, AMC saw its fourth quarter revenue improve from the previous quarter’s drought but fall short of 2021’s end-of-year period.

The multinational chain reported quarterly revenue of $990 million, a 2% improvement from last quarter’s $968 million but down from the “Spider-Man: No Way Home”-fueled total of $1.17 billion in the fourth quarter of 2021. AMC reported a GAAP net loss of $287.9 million and an adjusted net loss of $152 million or 14 cents per share, slightly beating consensus projections of a 20 cent per share loss and improving from the loss of 26 cents per share a year ago and 24 cents in the third quarter of 2022.

Global attendance for the quarter also slid 17.5% from 60 million in 2021 to 49.5 million in 2022. While the final months of 2021 had multiple hits like “Dune,” “No Time to Die,” “Ghostbusters: Afterlife” and “No Way Home” to drive admissions, the fourth quarter saw theaters relying primarily on “Avatar: The Way of Water” and “Black Panther: Wakanda Forever” for turnout, with major winter storms during Christmas weekend further hampering business for cinemas.

AMC is expected to have enough cash flow to continue operating through 2023 as box office grosses are expected to improve compared to last year. Through two months, the 2023 North American box office has reached $1.06 billion, down 25% from 2019 but up 42% from the anemic start to the 2022 box office.

“With more major movies coming in 2023, we are highly confident that our multi-year recovery will
continue to show considerable progress this year,” AMC CEO Adam Aron said in a statement. “But we cannot stress enough how crucial it is that for AMC to remain viable, we must continue to be agile and nimble not only in running our business day to day, but also in our continued raising of cash and decreasing the debt load on AMC Entertainment. As we have been saying for a long time, the industry-wide box office will not return to pre-pandemic norms before 2024 or 2025 at the earliest.”

In an effort to stay “nimble,” AMC is looking for other ways to build revenue and capital, including the launch of a line of at-home popcorn that will hit Walmart shelves next month. On Wall Street, the company has also made waves with its plan to convert its preferred shares, called “APE” units, into common shares in an effort to raise capital.

That plan hit a hurdle this week as a Delaware judge set an April 27 hearing date for an injunction petition filed by a group of AMC shareholders to block the preferred share conversion. If the conversion proposal is approved by AMC shareholders during a special meeting on March 14, it cannot be implemented until and unless the judge rules in the company’s favor.