It's even worse than you thought. AMC Entertainment Holdings (NYSE:AMC) warned in a public filing Tuesday that unless it can raise a "material" amount of money or lure substantial numbers of consumers to come back to the theater, it is going to run out of money by the end of the year.
What's worse, because its rivals have chosen to close their theaters, an already untenable situation will be exacerbated.
A bleak future
Recently ratings agency S&P Global predicted AMC could run out of money within six months, but the theater operator says industry conditions are so bad the decline is accelerating, though it hopes to stave off disaster until early 2021.
AMC notes 83% of its U.S. theaters and 77% of international theaters have reopened. It has served 2.2 million people domestically and over 5 million people internationally since reopening, but that translates into an attendance decline of 85% and 74%, respectively, compared to a year ago.
Most of the theaters left to reopen are located in just five states, but those locations represent approximately 23% of its total revenue.
Because movie studios are delaying their film releases until next year or are sending them directly to streaming video services, there is nothing to show in theaters. It's why Cinemark Holdings and Regal have chosen to close their theaters again.
Yet since that means there are few theaters available for studios who want to air their films, they too will choose to delay their debuts.
As a result, AMC is looking to raise more cash while controlling costs. Beyond adjusting theater hours, it may seek additional debt and equity financing, renegotiate rents with its landlords, sell assets, enter into joint ventures, or sell minority interests in its business.
AMC, though, says there is "significant risk" it will not be successful.