AMC Entertainment shares jumped 26% on Tuesday after the movie theater chain reported record second-quarter revenue of $1.6 billion. The company also posted its first-ever $300 million EBITDA quarter in its 106-year history, a milestone executives said reflects a strong box office recovery and cost-cutting measures.
Record revenue and first profitable EBITDA quarter
The $1.6 billion in quarterly revenue topped the previous record set in 2019, before the pandemic. AMC said the EBITDA figure — earnings before interest, taxes, depreciation, and amortization — marked a turning point for the company, which had been carrying heavy debt loads from its 2021 meme-stock-fueled financing.
AMC's CEO Adam Aron attributed the results to a slate of blockbuster movies and growing attendance, though he didn't give a specific breakdown. The company has been experimenting with pricing strategies, including variable ticket prices, to boost per-patron spending.
What drove the surge
Investors cheered the numbers, sending shares from around $4.50 to over $5.70 in regular trading. The stock has been volatile over the past year, swinging between $3 and $8, as the company's debt load and dilution from share sales weighed on sentiment.
The record quarter also comes as AMC faces pressure from its massive debt, about $4.5 billion. The company has been paying down some of that debt with proceeds from stock sales, but the latest results suggest its core business can generate enough cash to cover interest payments.
AMC's next quarterly report is due in November. The company will need to sustain the momentum through the fall and holiday seasons, which typically bring another round of big releases. For now, the record numbers give investors a reason to believe the theater chain has turned a corner — but the debt remains a heavy cloud.
