AMC Swung to a Profit, Still Needs More Cash

If only there was a “Barbenheimer” every quarter.

AMC, the world’s largest movie theater chain, said Thursday that it filed to offer up to $350 million of stock. The announcement followed a third-quarter earnings report on Wednesday that looked good, but apparently wasn’t good enough.

Let’s All Go To The Lobby

AMC’s most recent quarter was a pleasant and much-needed surprise for the company with roughly 1,000 locations around the world. Revenue jumped 45% to $1.4 billion — beating Wall Street’s predictions by about 12% — and theater attendance grew nearly 40% year-over-year, largely off the year’s two mega-hits, “Barbie” and “Oppenheimer.”

But now AMC plans to sell $350 million in stock, which sent its share price down more than 13%, to help repay debts and raise liquidity:

• Even before the pandemic practically shuttered the movie theater industry, AMC had nearly $5 billion in debt, after replacing its theaters’ traditional seating with cozy recliners and buying up competitors like Carmike and Odeon.
• But the pandemic also coincided with AMC’s emergence as a “meme-stock,” gaining a cult following on social media that — divorced from all financial reality — pushed the stock above $500 in 2021. (It’s now under $9.) The company took advantage of its status by selling its suddenly valuable shares; it last sold 40 million shares in September, raising about $325 million.

Strike Out: Though the Hollywood strikes appear to be over, many projects are well behind schedule — not the best news for any theater chain. “There has been and will be much collateral damage from these lengthy work stoppages,” AMC CEO Adam Aron said shortly before the actors strike ended. At least AMC has Beyoncé’s Renaissance Tour film to look forward to this December, hopefully recreating the box office success of Taylor Swift’s Eras Tour movie. And who knows, maybe AMC’s meme-stock status will return in 2024 for another chance to sell off stock.