No Money For AMC 💸
No Money For AMC
Even the largest chain of cinema’s in the United States, AMC, hasn’t been able to shift, adapt and overcome the troubles brought on by the coronavirus pandemic. On Tuesday, the company warned investors that there is a chance they will run out of cash by early 2021.
Over the course of this year, AMC stock has taken a serious beating with shares down a total of 44%. Following the news, the stock dropped over 7.5% by day’s end.
The problem isn’t that theatres have been unable to reopen. A total of 494 out of 598 U.S. locations have accepted popcorn lovers into their buildings but only at limited capacity. Out of the 494, the company’s most important locations like their theatres in California, Maryland and New York have had to remain closed. This has had a big toll on the company’s ability to survive as they represent a large percentage of the company’s total revenue last year.
Another problem for AMC comes in the form of a lack of theatrical releases. Movie goers can expect only four more major releases by year end and that’s only if their scheduled release dates remain unchanged.
The release of a vaccine or new insight on the virus may be the only thing that can stop the destruction of AMC’s business. In 5 years’, time, it will be interesting to see if consumers will be watching a docuseries on the rise and fall of movie theatres on streaming platforms such as Netflix, Disney+ or Prime Video.
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.