AMC Theatres is Holding on for Dear Life
Remember when people could go to the movie theatre with friends and family without a pandemic looming over their heads? Yeah, well, so does AMC Entertainment. One of the largest cinema chains in the industry recently reported a third-quarter loss of $905.8 million dollars, risking the chance of bankruptcy in the next few months.
This loss comes in spite of AMC opening 494 of 598 locations across the United States. Theaters that were allowed to open did so at just a meager 20 percent to 40 percent capacity dependent on their respective size. Compared to this time in 2019, attendance is down nearly 85 percent.
AMC executives announced just weeks ago that cash supply for the company could run out by the end of 2020. In an attempt to stay afloat, AMC is now taking drastic measures. The cinema giant has announced their plan to sell up to 20 million class A shares. This move would garner a profit for AMC amounting to roughly $47.7 million.
Following the announcement of shutdowns across the U.S. earlier this year, AMC Theatres was on the prowl for new movies. This came just as Universal Studios announced they would release Trolls World Tour to on-demand streaming services rather than theaters. In protest, AMC would later place a ban on showing any movies done by Universal Studios. “Trolls World Tour” has earned over $100 million since it’s release on these platforms.
During a period of such great adversity, it did not take long for AMC to succumb to the pressures of streaming services. Within the last few months AMC would reverse the ban and sign a deal with Universal, allowing the company to stream their programs just 17 days after first being shown in theaters. This deal shortens the theatrical window (70-90 day span) where movies can move from theaters to other platforms.
Both parties see this change as beneficial. A majority of movie revenue for AMC usually comes within the first three weeks of its release. In terms of mutual dependence, both Universal and AMC would avail most during this period. As Universal shifts their movies onto other platforms, AMC will receive a portion of the profits there, as well.
In hopes of avoiding bankruptcy, AMC Entertainment desperately awaits a COVID-19 vaccine and pileup of films to reverse the effect that the virus has had. AMC and other movie theaters can be added to the list of lost or threatened businesses during the grim, nearly year-long pandemic.
As a promotional offering, AMC Theatres is allowing private parties for up to 20 people starting at just $99. So if you and your friends are bored and looking for something to do, check out all to yourself theater rentals at one of the AMC locations here in town.