For movie theaters, some indicators are looking up as the post–COVID-19 economy continues to emerge. At AMC for example, sales and earnings have increased dramatically in recent quarters, driven by popular blockbuster films and people’s desire to return to community events. But the sailing is far from smooth. The strike by Hollywood writers and actors threatens to eliminate future content and create supply chain issues. Furthermore, AMC’s shareholders seek larger payouts, whereas the company’s CEO hopes to keep more cash reserves on hand. In addition, the company has indicated its plans to diversify, such as by introducing AMC Perfectly Popcorn, sold at Walmart stores and online. It also plans to add AMC-branded candy to theater concession stands. Moreover, AMC continues to acquire and open new theaters to expand its presence. The CEO also cited goals of introducing more bars to sell alcohol and larger format screens to existing theaters. Thus, shareholders may want to enjoy more of the profits of recent sales surges, but if they take too much, their future profits arguably might be in jeopardy.

Sources: Jill Goldsmith, “AMC CEO Sees ‘Serious Liquidity Issues’ Even as Box Office Booms,” Deadline, August 8, 2023