Retail investors rejoiced Tuesday as favorite meme stock AMC Entertainment Holdings Inc. was up 3.9% in pre-market trading thanks to a strong second-quarter earnings report.
Bolstered by a “notable increase” in the number and “quality” of cinema titles, the movie theater chain beat revenue predictions and posted an unexpected profit in what CEO Adam Aron said was AMC’s “strongest second quarter in four full years.”
AMC revenue increased 15.6% over Q2 2022 to $1.35 billion, above the $1.29 billion projected by analysts. The company made $8.6 million, or one cent per share, compared to a loss of $121.6 million, or 12 cents a share, last year.
Aron said AMC welcomed more than 66 million guests in the second quarter of 2023, a 12% increase and the highest number since the coronavirus pandemic. Moviegoer spending at theaters also “far exceeded pre-pandemic norms,” pushing food and beverage revenue per patron to $7.36 globally, within a penny of the company’s all-time high record.
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“With the first half of the year now behind us, the 2023 domestic industry box office is 20% ahead of last year, and we believe the second half of the year could be even better unless the current writers/actors strikes wind up delaying the release of movie titles into next year,” Aron said.
He declared an “explosive start” to the third quarter of 2023 with box office smash hits “Barbie,” “Oppenheimer,” “Mission: Impossible – Dead Reckoning Part One” and “Sound of Freedom” combining to make July the all-time highest grossing month for revenue in AMC’s 103-year history.
The No. 1 movie in the world, “Barbie,” has stunned Hollywood by earning $1.03 billion globally. Historical drama “Oppenhiemer,” which opened alongside “Barbie,” has earned $228.6 million worldwide and is so far the highest grossing R-rated film of the year. The success of these movies, and AMC’s apparent turnaround, could signal that summer blockbusters have recovered from COVID and are back in business.
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“There are so many more engaging movie titles to enjoy at AMC theaters later this year, and we can’t wait to welcome moviegoers to our nearly 1,000 theaters in the U.S., Europe and the Middle East,” Aron said.
However, the ongoing Hollywood writers’ and actors’ strikes have iced movie and TV production and a lack of content this fall and winter could set back movie theaters like AMC.
The writers, represented by the Writers Guild of America (WGA) have been on strike since May asking for a guaranteed number of writers per room, increased pay and regulated use of artificial intelligence (AI) in the writing process.
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Actors, represented by Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) want increased minimum pay rates, increased streaming residuals and guarantees from studio and production companies about how, exactly, AI will be used.
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The strike has impacted the production of film and television series and is expected to cost the industry more than $3 billion in losses.
Fox Business’ Elizabeth Stanton, Breck Dumas, Yael Halon and Reuters contributed to this report.