October 5, 2020
As expected, Cineworld Group Plc., parent of the second-largest theatrical chain in the United States, Regal Cinemas, said it would shutter all screens for an undisclosed period, beginning Oct. 8. Over the weekend media reports had surfaced the British-based exhibitor would re-shutter screens. The decision puts more than 45,000 jobs at risk, and sent shudders through the exhibitor market. AMC Entertainment shares are down nearly 11% in early trading.
The move comes after ongoing surges in coronavirus infections across the country and health concerns among consumers have seen Hollywood studios push back releases of major tentpole movies until 2021. The latest pushback included MGM further delaying the release of Daniel Craig’s last James Bond movie, No Time To Die, to April 2021.
“In response to an increasingly challenging theatrical landscape and sustained key market closures due to the COVID-19 pandemic, Cineworld confirms that it will be temporarily suspending operations at all of its 536 Regal theatres in the U.S. and its 127 Cineworld and Picturehouse theaters in the U.K. from Thursday, 8 October 2020,” the chain said in a statement.
Indeed, with Warner Bros.’ Tenet again the top weekend domestic box office draw with just $2.7 million in ticket sales, down 20.6% from the previous weekend, theaters are losing money staying open. With many screens in major markets such as Los Angeles and New York remaining shuttered, and the recent high-profile COVID-19 infections of President Donald Trump and the First Lady Melania Trump, consumer confidence among moviegoers will remain low.
“People aren’t dying to see a movie,” Michael Pachter, media analyst with Wedbush Securities in Los Angeles, said in a note earlier this summer.