There is no good news coming from AMC theaters regarding prospects of reopening the company’s many shuttered theaters. In a regulatory filing made public today, AMC theaters expressed “substantial doubt” regarding the future of its business.
The theater chain’s filing states that the company’s revenue dropped 22% in the first quarter of 2020, with the resulting loss somewhere between 2.1 billion and $2.4 billion (according to news reports). But that is nothing compared to the second quarter where the company states that it is generating no revenue.
Can AMC Theaters survive much longer paying rent with zero revenue? The AMC Empire 25 in Times Square
The lifting of COVID-19 restrictions on operating is not enough to rescue this company. The numerous articles covering today’s filing also touch on a salient point: Hollywood is holding back on tentpole movie releases, it is also going direct to digital with some titles. The point being that even if the theaters were free to pack each auditorium full, there may not be enough movies to achieve that.
AMC still has some cash left, but clearly time is running out. What will happen if AMC goes under? The studios can’t make money on their movies if they can’t distribute them and get an audience to pay. Will movie theaters get a bailout, or will studios move on to other distribution models? It looks like we will find out soon since AMC theaters can’t hold out forever.
Join the ongoing discussion about the future of AMC theaters in the forum.