Thanks to the success of “Top Gun: Maverick” and other early summer blockbuster hits, AMC has hit Wall Street’s second-quarter revenue projections with $1.14 billion. But with the chain still spending more than its making, AMC reported a net loss of $121 million for the quarter.
That amounts to an adjusted loss per share of 24 cents, up from a 52 cent loss last quarter and 71 cents in the year-ago period. Attendance rose to just over 59.1 million tickets sold worldwide, with 43 million coming from American theaters, up from 25.7 million tickets domestic and 39 million tickets worldwide last quarter.
AMC’s increased spending comes largely from acquisitions of new theaters, implementation of COVID-19 safety protocols, and efforts to reduce its $5.5 billion debt load. The company has also made unconventional moves under Chief Executive Adam Aron, including buying a minority stake in precious metals mining company Hycroft, a move that was widely criticized by analysts and media pundits for being outside of the company’s scope.
“While our reported losses will continue to be impacted by market price volatility, we continue to believe strongly in the potential value of our $28 million Hycroft Mining investment. In fact, Hycroft just announced it would commence its largest drilling exploration program in nearly a decade, and we have every confidence that over time our investment in Hycroft will pan out to be golden,” Aron said in a statement.
Theaters enjoyed a strong domestic box office total of $2.32 billion from April to June, driven by “Top Gun: Maverick” becoming the highest Memorial Day opening weekend ever and grossing over $1.3 billion worldwide to date. Other big hits included “Jurassic World: Dominion” and “Doctor Strange in the Multiverse of Madness” with a combined $726 million while “Sonic the Hedgehog 2” contributed $190 million thanks to resurgent family turnout.
AMC’s stock has risen 34% over the past week to $19.18, its highest since early April. But the chain –along with the entire industry — faces a significant box office downturn over the next two months as last weekend saw overall grosses slip below $100 million for the first time since mid-May. Currently, no film through the end of September is projected to earn an opening weekend of above $25 million.
In the fourth quarter, the box office slump is expected to gradually subside, with “Black Panther: Wakanda Forever” and “Avatar: The Way of Water” expected to become among the highest grossing films of the year.
“Our current internal forecast is that the 2023 domestic box office, the basic metric suggesting the health of theatrical exhibition both in the U.S. and globally, will be billions of dollars larger than that of 2022. We look forward to Q4 of 2022 and calendar year 2023 with glee,” Aron said.
