Thanks to a great summer movie lineup, IMAX CEO Richard Gelfond described the movie theater industry as “smoking.”
The CEO of theater technology giant IMAX (NYSE:IMAX) told CNBC on Monday that despite recent COVID shutdowns in China, one of its biggest markets, the business is still cash-flow positive.
Gelfond stated that the industry is only down 5% from 2019, which was its best year ever.
IMAX Presents Mixed Quarterly Report
A mixed quarterly report from IMAX was presented last week, meeting top-line projections while missing earnings predictions. After the earnings announcement, shares increased, but they soon started to decrease. By the time they closed on Friday, they had declined by 3.5 percent.
IMAX (NYSE:IMAX) has experienced a general drop of roughly 11% in 2022. Even though the stock is down for the year, it has still outperformed both the general market and many of its competitors in the movie theater industry.
For instance, National CineMedia (NASDAQ:NCMI) has decreased by 53% while AMC (NYSE:AMC) has decreased by 45% in 2022.
However, Cinemark Holdings (NYSE:CNK) and The Marcus Corp. (NYSE:MCS), both of which have declined by less than 10% so far this year, have outperformed IMAX.
Has Industry Hit a Turning Point?
The IMAX CEO cited this past weekend as a potential “turning point” for the Chinese market when speaking of that country. The market had its greatest summer weekend since September 2019, according to Gelfond, after COVID limitations were eased.
In the long run, Gelfond pointed out that the company’s emphasis on a better theater experience will probably be supported by industry trends. He mentioned that IMAX has profited thus far this summer from blockbusters like Top Gun: Maverick and the most recent Marvel films.
Additionally, he clarified that movie companies work in the blockbuster industry. Fortunately, he believes that is the way the entire business is heading. As a result, a number of indie and middlebrow films are switching to streaming sites. The larger ones, though, resemble somewhat of a movie ‘Murderer’s Row’ that could produce big profits in the future.
But that’s the future, as of right now many analysts have the market rated as recovering but not increasing.
Featured Image: Megapixl @Jetcityimage
