AMC Entertainment Holdings Inc. (NYSE:AMC) CEO Adam Aron has expressed optimism about the movie theatre chain’s prospects, saying it is looking at an “increasingly favorable environment” for movie-going in the coming months.
What Happened: Aron attributed the favorable environment partly to the U.S. vaccination program and the arrival of long-awaited new movie title releases to theatres.
The CEO added that AMC, which reported its first-quarter results on Thursday, was able to attract about 7 million U.S. and international moviegoers to its theatres in the quarter.
See Also: How to Buy AMC (AMC) Stock
AMC said that as of the Q1-end, it was operating at 585 domestic theatres, representing about 99% of domestic theatres, with limited seating capacities of between 15% and 60%.
Capacity restrictions for movie theatres in New York City, a huge market for movie theatres, will be removed effective May 16, the company noted.
For the first quarter, AMC reported a narrower net loss, while revenue fell 84% year-over-year. The results missed analysts’ estimates.
Why It Matters: AMC managed to avoid bankruptcy amid the pandemic after the closure of theatres forced the company into a cash crunch. The company reopened 98% of its locations in March.
Despite its weak finances, AMC shares have been popular among retail investors. Traders belonging to the Reddit Investor forum r/WallStreetBets bid up AMC and other heavily shorted stocks such as GameStop Corp. (NYSE:GME) to create a short squeeze earlier this year. AMC Entertainment’s stock has returned year-to-date gains of 324.5%.
Price Action: AMC shares closed almost 1.9% lower in Thursday’s regular trading session at $9.00, but rose 2.6% in the after-hours session to $9.23.
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Photo by Dave Dugdale on Flickr
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