Outside the cruise ship industry, movie theater stocks have had one of the most remarkable turnaround stories coming out of the pandemic. Studios delayed their major theatrical releases, sending some directly to digital platforms. They also narrowed the multiplex exclusivity windows, allowing content to be fed into their own streaming services sooner.
But we're certainly not back to popcorning like it's 2019.
AMC Entertainment (AMC 4.08%) issued a press release on Monday, boasting that it entertained 5.5 million at its domestic AMC screens during the week of Thanksgiving, its strongest weekly showing of the year. The one-two punch of Zootopia 2 and Wicked: For Good drew crowds during the holiday week. But it wasn't enough to help one of the market's hardest-hit stocks.
Shares of AMC are falling sharply for the fourth consecutive year. The stock enters December trading 41% lower in 2025. That follows annual drops of 85%, 85%, and 35% in the three previous years. From their peak in the summer of 2021, the shares have now plummeted by 99.7% -- not a typo. This meme stock has just been a mean stock to investors.
Can it finally turn things around next year? Let's go over three things AMC needs to do in 2026 to alleviate the pain for its battered shareholder base.
Image source: Getty Images.
1. Profitability can't hurt
AMC can't singlehandedly get the country excited about returning to the local multiplex again. Domestic box office receipts this year are up 1% from where they were a year earlier, but they're still 29% below the $10.3 billion collected through the first 11 months of 2019.
Making matters worse, average admission prices are 23% higher now than they were six years ago. Put another way, the number of tickets sold so far this year is 39% less than through the first 11 months of 2019. And it's not as if 2019 was so great. In terms of tickets sold domestically, it was the industry's worst year since 1995. The fundamentals were already deteriorating before the pandemic wreaked its havoc on the metrics.
Lost in the narrative is that the surviving players outside AMC have done a great job of turning their operations around. Rival Cinemark (CNK 1.83%) has been profitable since 2023. The same can be said about theatrical-experience booster Imax (IMAX 0.70%). Cinemark and Imax are in the black for the third straight year, while AMC hasn't turned an annual profit since 2018. It has scored a quarter of profitability here and there, but it's unable to sustain positive net income over the course of a year.
NYSE: AMC
Key Data Points
2. Bloating the share count does hurt
AMC's operating profit has been positive in two of the past three years, but debt interest is the monster under its reclining seats. Despite seeing its long-term debt -- and even its long-term lease obligations -- declining for the fifth year in a row, what it's shelling out in interest expense is moving higher for the third straight year.
Rising rates are a problem, but creditors may also be unhappy about AMC as a credit risk, given its liberal issuance of new shares in recent years.
Cinemark has seen its fully diluted share count climb 24% since 2019. Imax has seen its outstanding shares decline 10% in that time. But you'll want to sit down for AMC's split-adjusted share count. It has ballooned from 11.8 million to 440.6 million in that time, a 37-fold jump.
A lot of boardrooms for pandemic-smacked companies turned on the spigot for new shares as a way to get through a jam in 2020. AMC can't seem to turn it off, which makes it hard for shareholders who are already drowning in the dilution. If you owned a piece of AMC in 2019, you own less than 3% of that stake today -- and that's not even diving into the actual stock's decline. If AMC can show restraint with its printing press, shareholders may have a chance.
3. Creative thinking is crucial
AMC got creative during the early pandemic slowdown. It shifted to reserved seating, justifying higher ticket prices. The country's largest multiplex operator also promoted the rental of some of its smaller screens for private showings. And it expanded its food, beverage, and collectibles offerings. But that's not enough. AMC will have to do more.
Revenue declined 4% last year and has dipped in two of this year's first three quarters. Adjusted net losses have widened in 2025, and free cash flow remains negative. Trailing revenue is still 11% below the 2019 peak. Trailing operating profit is 80% below the company's 2018 high.
The reinvention process needs to go harder.
The truth is that the default setting for multiplex visits has been negative since peaking more than two decades ago. Domestic theaters may never sell a billion tickets a year again. AMC was able to spice things up by acquiring a couple of smaller multiplex operators in 2017, but it needs real disruption beyond leaning on M&A to buy market share. Hopping on buzzy trends -- such as introducing its own credit card, accepting cryptocurrency for purchases, and going retail with packaged popcorn -- isn't the answer. All three of those moves will be forgotten in a few years.
There can be no revolution here without reinvention. I don't have the magical elixir for growth, and unfortunately, AMC doesn't have it either. It just needs to be willing to break things -- other than the will of its beleaguered shareholders -- while there's still time for a Hollywood ending.
