Like fellow theater chain Cinemark, AMC Theatres saw a narrowing in losses this past quarter compared to last year, but still had to weather a long Q3 box office drought like the rest of the industry.
In its quarterly earnings report published Tuesday, AMC reported quarterly revenue of $968 million, up 27% year over year from the $761 million reported in Q3 2021 but down from the $1.14 billion last quarter when “Top Gun: Maverick” led an early summer boom period for the box office. Wall Street analysts had projected quarterly revenue of $977 million.
Adjusted loss attributable to shareholders stayed consistent from last quarter at 20 cents per share, improving from 44 cents per share loss in Q3 2021.
In previous earnings calls, AMC CEO Adam Aron predicted that it would take time for a true rebound in movie theater business to arrive and that the company would have to navigate a weak release slate in August and September, during which time domestic grosses sank to a combined $790 million compared to $1.52 billion in August and September 2019.
But Aron also expressed faith that revenue would dramatically increase in Q4 with the release of films like “Black Panther: Wakanda Forever,” which comes out this Friday, and “Avatar: The Way of Water” next month. Aron reiterated his optimism in a statement published this afternoon.
“Exactly as anticipated and foreshadowed on our last quarterly earnings call, our third quarter results were impacted by a particularly soft industry-wide box office in the latter two-thirds of the 2022 third quarter, but encouragingly our overall per-patron metrics for both admissions revenue and food and beverage spending remain well above pre-pandemic levels, growing a sizable 12.0% and 30.0%, respectively, compared to the third quarter of 2019,” Aron wrote.
Since the box office drought set in back in August, AMC’s stock price has plummeted nearly 80% from $24.81 on August 16 to just $5.62 at time of writing. The main cause of that sudden drop was the announcement of what was essentially a 2-for-1 stock split with the creation of AMC Preferred Equity (APE), a special dividend intended to help the company tackle its $5.5 billion debt load. Combined, the stock prices of AMC and APE has sunk to approximately $7.22.
But AMC has continued to announce unconventional new plans to build alternate revenue streams. Along with APE and the purchase of a minority stake in Nevada gold mining company Hycroft, the chain announced on Monday that it had reached a partnership with Zoom to create videoconferencing rooms in select theaters in 17 cities starting next year. AMC hopes to use the partnership to attract companies to host multi-city meetings and events at their theaters, with options for concessions and film screenings also available.
“So many of us know how vital Zoom is in managing our enterprises. Now through this partnership of Zoom and AMC, we have the best of both worlds — the spectacular communications platform of Zoom combined with the comfort, size, scale, and state-of-the-art sight and sound capabilities of AMC’s centrally located theatres,” Aron said. “This creates an all-new product in major cities across the U.S. for companies and meeting planners.”