news Movie Theater Stocks Plummet After Modest ‘Avatar 2’ Opening Weekend

IndieWire already told you that “Avatar: The Way of Water” alone is not the savior that the box office needed, but now Wall Street is taking notice. AMC Entertainment (AMC) and Cinemark (CNK) stocks both took steep dives on Monday, a strong suggestion that some market watchers expected more at the box office from the final blockbuster of 2022.

Shares in AMC dropped 8.26 percent on Monday, when Cinemark sunk 10.30 percent (CNK has rallied back a few points in after-hours trading). IMAX closed the first trading day after the “Avatar 2” opening weekend down 5.76 percent. Disney, the studio behind “Avatar: The Way of Water,” declined 4.77 percent to hit a low point not seen since 2014. (The beginning of the pandemic came darn close for Disney, which was forced to shut down theme parks.) The overall stock market was far closer to flat on Monday.

So why the pessimism for these four players? James Cameron’s “Avatar” sequel brought in $134.1 million over the weekend, an impressive figure and one of the larger openings of the year — but it isn’t the Earth-shattering figure put up by “Spider-Man: No Way Home” ($260 million) this same time a year ago. The “Avatar 2” opening weekend was below initial box-office projections, underperforming some by as much as $50 million.

And “Avatar” was pretty much the only thing for the masses to flock to this weekend. The other movies in the Top 10 grossed a combined $18 million, with a lack of not just studio fare but also few new platform releases from independent distributors (A24’s “The Whale” was the exception). It doesn’t help that there’s only so much new stuff coming next weekend over the Christmas holiday, including Paramount’s “Babylon,” Sony’s Whitney Houston biopic “I Wanna Dance With Somebody” and Universal’s animated “Puss in Boots: The Last Wish,” pointing to a potentially muted holiday at the movies.

That said, there could be at least one other Pandora-sized savior at the box office early in 2023, specifically Marvel’s “Ant-Man and the Wasp: Quantumania,” as well as some other genre films like “M3GAN,” “Knock at the Cabin,” and “Creed III.” And analysts are hopeful that globally, next year can continue to gain on 2022 — even if we might have to wait another full year before the box office returns to pre-pandemic levels.

AMC stock did find some positivity on Monday however. AMC CEO Adam Aron reported that the theater chain’s newly launched APE stocks — which are preferred equity share stocks — have raised $162 million for the company and slashed $180 million of its debt obligations this year. In fact, it’s capital that Aron already put to some use by announcing AMC had acquired a closed ArcLight Theaters location in Boston.

“Even though the APE units and our common shares are economically equivalent, it is disappointing that the APE units have since inception consistently traded at a significant discount to the AMC common shares,” CEO Adam Aron said in a press release. “While the trading prices of the two securities seem to reflect distinct market and trading dynamics, the APEs are serving precisely the purpose originally intended for them.”
 
There is no mistaking the fact that the curtain is descending on event cinema. This goes back way further than people think, back to the 1960s. It's been a gradual collapse, and the streaming premieres associated with the pandemic were just a perfect storm that essentially served as a coffin nail for an industry already in decline.

You would be shocked by how little of a cut theaters get these days. The entire local theater industry has essentially been supported by 9 dollar cups of sprite and 20 dollar boxes of popcorn for a decade now. The Hollywood lawyers kept progressively demanding a larger and larger cut of ticket prices, until there was nothing left for anyone except the ultra rich people who were able to dictate the rules of the system.

Sound like a conspiracy theory? The federal government actually had to step in at one point to keep Hollywood from staging what was essentially a hostile takeover of all theater chains. Look it up.
 
Sound like a conspiracy theory? The federal government actually had to step in at one point to keep Hollywood from staging what was essentially a hostile takeover of all theater chains. Look it up.
If you're talking about the Paramount Consent Decree, that's old news and has long since become a joke.

I don't know who you think would be shocked at how little the theater own keeps from each ticket. That too is old news. Common knowledge that they make most of there money from concessions.
 
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I thought they still get a huge cut of the opening weekend. is that no longer the case ?
 
No they take it in the shorts.
It's a sliding scale. New movie opening week, maybe 5 or 10 percent. 2nd week the percentage goes up. 3rd week it goes up more. Those aren't exact number but the point is that the newer and more popular the movie is, the less the theater owner gets. There are even times (quite often, actually) when the theater chain pays money in advance for the privilege of being able to show the movie when it's ready. What I mean by that is the theater chain's advance on the box office is used by the production company to finance the film. They are paying to show a film that hasn't even been made yet!!!
 
No they take it in the shorts.
It's a sliding scale. New movie opening week, maybe 5 or 10 percent. 2nd week the percentage goes up. 3rd week it goes up more.
That's the opposite of what I remember reading.
Is there a reputable source on this you can link to?

I read that theatres make the most on opening weekend and it dimishes thereafter.
 
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