AMC Entertainment on Wednesday warned investors of declines in key metrics during the second quarter, sending shares down more than 5%.
The company blamed last year’s actors and writers strike for a slowdown in theatrical releases which ultimately led to “weakness” in the quarter ended June 30.
AMC’s preliminary results revealed revenue down more than 23% during the period to $1.03 billion. It also said it expects to post a net loss of $32.8 million compared to a profit of $8.6 million in the second quarter of 2023. Full results will be posted Aug. 2.
“As we accurately predicted and previously disclosed, the prolonged actors and writers strikes of 2023 severely reduced the number of movies being released theatrically in the early months of 2024,” Adam Aron, chairman and CEO of AMC Entertainment, said in a statement. “This explains the weakness in our preliminary Q2 2024 results, as contrasted with the same quarter of a year ago.”
The theatrical industry has gotten a boost in the last month after a pandemic-driven slump, as moviegoers have returned in droves for films like Disney and Pixar’s “Inside Out 2,” Universal and Illumination’s “Despicable Me 4,” Universal’s “Twisters” and the surprise indie horror flick “Longlegs” from Neon.
“But if looking only at the full quarter, the lay observer might easily miss the incredibly good news that transpired within the second quarter,” Arons said. “Finally, moviegoing in theatres appears again to be on an upwards trajectory.”
Still to come is the much anticipated release of Disney and Marvel’s “Deadpool and Wolverine,” which is expected to have the highest opening for an R-rated film in history and the highest opening of 2024.
And some heavy hitters are coming during the last stretch of the year. “Beetlejuice Beetlejuice” arrives in early September, “Joker: Folie a Deux” hits in October alongside “Venom: The Last Dance,” and November sees “Gladiator II,” “Moana 2” and “Wicked.” Additionally, December will have “Kraven the Hunter,” “Sonic the Hedgehog 3″ and “Mufasa: The Lion King.”
“AMC continues to be confident that industry-wide movie revenues for the second half of 2024, and into 2025 and 2026 will continue to show increasing strength,” Aron said. “This in turn suggests that AMC should enjoy increasing adjusted EBITDA, if as and when overall industry revenues are climbing. Such improvements in revenues, earnings and adjusted EBITDA are our current expectations going forward, all of which shine brightly on AMC’s future.”
Disclosure: Comcast is the parent company of NBCUniversal and CNBC.