Adam Aron, CEO of AMC Theatres, has decided to close out 2023 with a clapback. Aron tweeted a stern message on X, formerly known as Twitter, hours before the new year rang in for the people who predicted that AMC would file for bankruptcy in 2023, in which he slams them as “prophets of doom.”
To the prophets of doom certain that AMC would fail as a company and be forced into bankruptcy court in 2023: It is December 31, so we all know that YOU WERE WRONG. AMC is still here, still innovating, still blazing new trails.
To the rest of you (think Apes) Happy New Year! pic.twitter.com/a2NXSypWsD
— Adam Aron (@CEOAdam) January 1, 2024
Aron has recently appeared to be on the defense about the success of AMC.
“What fools say people don’t go to movie theatres anymore?” wrote the CEO in a tweet on Dec. 27, while touting the recent success of Oprah Winfrey’s remake of “The Color Purple,” claiming that the movie is the second-biggest opening on Christmas Day ever.
What fools say people don’t go to movie theatres anymore? Warner Bros & Oprah Winfrey’s The Color Purple opened Monday. The biggest Christmas Day domestic opening gross of any movie since 2009, the 2nd biggest Christmas Day opening ever! Hollywood, give us more movies like this! pic.twitter.com/KrnSOZcl2i
— Adam Aron (@CEOAdam) December 27, 2023
After facing plunging stock during the Covid pandemic due to consumers ditching movie theaters for streaming services to avoid falling ill from the covid virus, AMC came close to declaring bankruptcy four times in 2021. Since then, analysts have been skeptical about the theater chain’s ability to bounce back from the losses it faced during the pandemic.
In the beginning of 2023, financial analyst Harrison Schwartz predicted that AMC may not survive by the end of the year even if movie ticket sales rise.
“AMC remains challenging due to immense working capital deficits, high-interest costs, and chronically negative operating income.” he wrote in a report on Seeking Alpha. “Without even more equity dilutions, AMC will likely face a liquidity crisis in 2023.”
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AMC faced a boost in ticket sales later on in the year during the summer due to the success of films such as “Barbie” and “Oppenheimer,” which generated over $2.5 billion from the worldwide box office combined.
In its third-quarter earnings report, AMC reported in November that it brought in roughly $1.4 billion in total revenue for the quarter, which is a 45.2% increase compared to what it earned during the same time period in 2022. Despite the recent success, Aron noted in the report that the Writer’s and Actor’s strikes, which were ongoing during the third-quarter, will have negative effects on AMC in 2024.
“These results are encouraging. They make us more confident than ever about the long-term relevance and prospects for moviegoing in the many years ahead,” said Aron in the earnings report. “Having said that, the short-term impacts of the Writer’s and Actor’s strikes will cause additional and needless challenges for AMC in 2024.”
During the fall in 2023, AMC faced another boost in ticket sales when it released two major concert films; “Taylor Swift: The Eras Tour” and “Renaissance: A Film by Beyoncé,” which have both topped box office numbers and are currently bringing in millions of dollars for the company.
Regardless of AMC’s recent ticket sale success, analyst James Goss in early December said in an analyst note that he doesn’t recommend for investors to buy AMC stock as he is uncertain if its low stock price, which is currently around $6, will revive. He also claims that AMC’s stock price issues are due to “its significant amount of debt rather than how it’s doing at the box office.”
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