By Connor Smith
With help from Taylor Swift's massive fan base, AMC Entertainment Holdings pulled a fall blockbuster out of thin air.
The theater firm said Friday that advance purchases for Taylor Swift: The Eras Tour concert film hit $26 million in ticket sales on Thursday, which crushes the previous single-day sales record held by 2021's Spider-Man: No Way Home at $16.9 million. In fact, it only took the first three hours of sales on Thursday for Swift's film to shatter No Way Home's 24-hour ticket sales record.
AMC said it would add more showtimes to meet higher-than-expected capacity. The concert film will play at least four showtimes a day on Thursdays, Fridays, Saturdays, and Sundays at every U.S. AMC location, starting on Oct. 13.
Wedbush analyst Michael Pachter previously guessed opening day sales of less than $10 million, or two to three times that if it was promoted properly.
"I clearly was wrong," he told Barron's after AMC announced the sales.
Pachter says the concert film is likely to hit $250 million in ticket sales or more. He doesn't think the numbers will be a game-changer for AMC, but believes the concept of filming concerts, or even streaming them live in theaters, has legs.
"There is no reason a sold-out concert series can't supplement in a city with overflow tickets sold in theaters," Pachter says.
AMC stock was down 1.8% in Friday morning trading. The company recently pulled off a reverse stock split and converted preferred equity units to common shares. The moves will allow the firm to sell more stock to pay down debt, though each sale will dilute the holdings of existing shareholders.
AMC has cultivated a passionate base of retail shareholders who congregate in online forums. The firm first attracted attention during the pandemic, when short sellers bet shutdowns would spell major trouble for AMC.
Instead, buyers piled into the stock and squeezed short sellers. Adjusting for splits, the stock has traded as high as $107.50 and as low as $10.72 in the past 12 months. It soared north of $500 in June 2021. Though a wave of coming stock sales may make traditional Wall Street investors wary, the retail crowd is currently celebrating the runway that such stock sales will provide the company.
Analyst Alicia Reese, along with her colleague Pachter at Wedbush, upgraded AMC stock to Neutral with a $19 price target on shares on Aug. 24.
"AMC is well-positioned against an improving industry backdrop," they wrote at the time. "Moviegoers are finicky with content these days, but we are seeing that they also increasingly opt for premium screens and a larger basket of high-margin concessions."
The Eras Tour itself is a massive success, projected to be the biggest-grossing tour in concert history. The Federal Reserve Bank of Philadelphia said earlier this year that despite a slowing recovery in tourism, May was the strongest month for hotel revenue in the city since the onset of the pandemic, "in large part due to an influx of guests for the Taylor Swift concerns in the city."
The lesson here is to never bet against Taylor Swift and her fans.
Write to Connor Smith at connor.smith@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
September 01, 2023 10:56 ET (14:56 GMT)
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