Cinemark Gets Wall Street Love as Moviegoers Return to Theaters

Cinemark, the nation’s No. 3 theatrical chain, is getting some Wall Street love after posting a June box office performance that was the chain’s biggest in revenue since the pandemic began.

Citing the release of Paramount Pictures’ Top Gun: Maverick, featuring Tom Cruise in the sequel to his 1986 original, Universal Pictures’s Jurassic World: Dominion, Pixar’s Lightyear and Warner Bros. Pictures’ Elvis biopic, among others, Morgan Stanley media analyst Benjamin Swinburne upgraded the Cinemark’s stock rating to “overweight.” The move sent the chain’s stock up more than 9% in midmorning trading.

“Beginning in late 2021, the North American box office has been trending steadily upward as consumers have become more comfortable with going to theaters,” Swinburne wrote in a note, adding that the return of the frequent moviegoer, which he believes makes up 50% of box office ticket sales, is driving revenue.

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“We have consistently stated that a steady stream of diverse, compelling new film content, along with improving moviegoer sentiment, would be driving forces behind the re-ignition of theatrical exhibition,” Cinemark CEO Sean Gamble said last month.

Swinburne contends the North American box office can pull back about 85% of the pre-pandemic 2019 levels by 2023, with Cinemark maintaining a 14% market share behind Regal Cinema and AMC Theatres.

“Moviegoing has also proven counter-cyclical as a form of inexpensive entertainment, insulating [Cinemark] from a slowing economy,” he wrote.

June 2022 North American Box Office Set Post-Pandemic Record

Thanks to Tom Cruise’s enduring star power and some wayward dinosaurs, June ended with the highest box office — $953.4 million — since the pandemic began in March 2020. The tally bests previous ticket sale pole sitter, December 2021, which tracked about $920 million in revenue largely on the back of Sony Pictures’ Spider-Man: No Way Home with $573 million in revenue.

Last month was led by Top Gun: Maverick, the long-awaited sequel to Cruise’s 1986 original Top Gun, which generated about $358.1 million, and Universal Pictures’ Jurassic World: Dominion with $313.1 million in ticket sales. Other significant revenue generators included Disney/Pixar Animation’s Lightyear with $97.1 million, and Warner Bros. Pictures’ biopic Elvis with $44.7 million.

Cinemark CEO Sean Gamble

“We have consistently stated that a steady stream of diverse, compelling new film content, along with improving moviegoer sentiment, would be driving forces behind the reignition of theatrical exhibition,” Sean Gamble, CEO of Cinemark, said in a statement. “We were thrilled to see these two factors play out throughout the month of June.”

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Gamble said the combined strength of June’s film releases yielded multiple noteworthy results for the North American movie industry. For instance, the $216 million box office generated during the weekend of June 10 would have ranked as the fourth-highest three-day box office weekend in 2019. Additionally, the weekend of June 17 marked only the fourth time in history that three films generated more than $40 million each at the box office — and the first time since 2013.

The fiscal results underscore increasing 88% moviegoer confidence in being “very or somewhat comfortable” going to the movies today. Notably, the variety of new releases has also brought a diversity of moviegoers back to theatres, according to Cinemark.

Of those who saw Top Gun: Maverick at a Cinemark theater on opening weekend, more than 25% were returning to the exhibitor for the first time in over a year. Nearly 30% of those patrons were over the age of 55, marking notable progress in theatrical exhibition’s broader recovery.

“Cinemark remains optimistic about the industry’s strong path to recovery as new films continue to hit the big screen through the remainder of this year and beyond,” Gamble said.

Cinemark Partners With Disney to Release Marvel Studios NFTs Ahead of ‘Thor: Love and Thunder’ Movie Debut

Taking a page from the AMC Theatres’ playbook, theatrical chain Cinemark is joining forces with Disney to give its Cinemark Movie Rewards members the chance to win one of Marvel Studios’ non-fungible tokens (NFTs) for Marvel Studios’ Thor: Love and Thunder.

From June 28 through July 7 moviegoers can visit the chain’s website for the chance to be one of only 1,000 owners of the unique digital collectible. Tickets are on sale now at Cinemark.com and on the Cinemark app for Thor: Love and Thunder, which premieres in theaters on July 8.

The NFT market market revolves around collectibles, including digital artwork, sports cards, and similar artifacts that can create market value based on consumer interest.

AMC in February launched an NFT marketing campaign with Warner Bros. Pictures for The Batman movie.

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“It is fitting that our rewards members will have the chance to win these unique digital collectibles,” Wanda Gierhart Fearing, chief marketing and content officer at Cinemark, said in a statement.

Members can visit their rewards page on the Cinemark website or app for a unique pin that will allow them to play the instant-win game daily at Cinemark.com/thorNFT. Winners will receive a code redeemable at VeVe.me that will make them one of the lucky few owners of this spectacular digital collectible token.

Disney’s latest collaboration around NFTs is part of its broader focus on expanding next-generation storytelling in ways that blend and connect physical, digital and virtual audience experiences.

AMC Theatres, Cinemark Break Opening-Night Records Screening ‘Spider-Man: No Way Home’

AMC Theatres, the largest theatrical exhibitor in the world, announced that Sony Pictures’ Spider-Man: No Way Home broke its opening-night box office records. The movie was the single-highest grossing movie title on its opening night in the chain’s history, for a title opening in the month of December. It also was the second-highest grossing movie title on its opening night of all-time, falling just short of Avengers: Endgame, which opened in 2019.

Approximately 1.1 million people attended a screening at a U.S. AMC theater on Friday, Dec. 17. This was the single highest number of people watching one movie on one day at an AMC screen during all of calendar years 2020 and 2021. Attendance for Spider-Man at AMC’s international theaters was also robust.

“Needless to say, we are ever so happy to see a record-setting number of people returning to the cinema to capture the magic offered at AMC movie theatres,” CEO Adam Aron said in a statement.

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Separately, Cinemark, which operates 4,440 screens across the Century, Tinseltown and Rave brands in the United States, said enthusiasm for No Way Home set a U.S. box office record, delivering the chain’s best opening night of all time. Ticket sales for the movie skyrocketed through advance sales and continued until openingwith a meaningful portion of fans returning to the theater for the first time since the pandemic began in March 2020.

Cinemark said consumer demand to see the live-action superhero movie in an ultra-immersive auditorium resulted in record-setting XD purchases.

“The sheer volume of people who came to see this film on the biggest screen, many for the first time since the pandemic, underscores the irreplaceable value of the in-theater experience, which we are thrilled to continue to offer in collaboration with our studio partners,” said Justin McDaniel, SVP of global content. “Congratulations to the entire Sony team for a remarkable opening performance for their latest blockbuster.”

Cinemark: Advance ‘Spider-Man: No Way Home’ Ticket Sales Near All-Time Exhibitor High

Hype for the pending Dec. 17 theatrical debut of Sony Pictures’ latest installment in the webslinger franchise, Spider-Man: No Way Home, continues to build, with Cinemark Dec. 1 disclosing that advance ticket sales are the second-highest in the exhibitor’s history.

The movie, directed by Jon Watts, is the third starring Tom Holland as Peter Parker/Spider-Man, and also starring Zendaya. The previous installment: Spider-Man: Far From Home, became highest-grossing franchise release with $1.13 billion in global ticket sales.

Plano, Texas-based Cinemark, which operates 5,900 screens in the U.S. and South America, said advance sales are approaching that of 2019 record holder Disney/Marvel Studios’ Avengers: Endgame.

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“This surge of ticket sales proves the power of an exclusive theatrical release for a compelling film, especially as people are eager to get out of their homes and share in a communal experience,” Justin McDaniel, SVP of Global Content at Cinemark, said in a statement.

The sentiments are shared by rival AMC Theatres. The nation’s largest exhibitor experienced its second-busiest ticket sales day (Nov. 29) for a single movie title in the company’s history. It also was the single busiest ticket sales day since AMC re-opened many of its screens during the summer of 2020, from their initial coronavirus closings in March 2020.

AMC’s ticket sales for No Way Home came within 1.5% of record holder Avengers: Endgame.

A key sales driver for AMC was a collaboration with Sony Pictures offering the first ever NFT (non-fungible token) promotion by a major theatrical exhibitor. A limited quantity of up to 86,000 NFTs (which can be traded like shares of stock) were made available to AMC Stubs Premiere, A-List and Investor Connect members, with one NFT being given per qualifying member. To qualify, members had to be among the first 86,000 to purchase their opening day tickets (or in the case of AMC Stubs A-List members who were the first to reserve their seats), at any and all U.S. AMC Theatres locations.

Cinemark Narrows Q3 Fiscal Loss to $78 Million

Moviegoers may be returning to the box office, but the fiscal impact remains a mixed bag.

Cinemark Nov. 5 reported a third-quarter (ended Sept. 30) loss of $78 million on revenue of $435 million. That compares with a loss of $148 million on revenue of $35 million in the previous-year period when most U.S. theaters were shuttered or operating under limited seating capacity due to the pandemic.

Cinemark, along with AMC Theatres and Regal, ranks among the largest exhibitors in the world. It operates 5,872 screens across 42 states and several international markets.

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“We are highly encouraged by sustained positive trends in escalating consumer demand for theatrical moviegoing and growing momentum at the box office,” CEO Mark Zoradi said in a statement.

Zoradi said the chain saw a 61% quarter-over-quarter growth in worldwide attendance, which he said helped decrease the net loss by $64.7 million dollars from the second quarter (ended June 30).

“We expect a continued ramp-up in box office performance over the course of the coming months, and October already delivered the best monthly box office results since the onset of COVID-19,” he said. “As the pandemic further subsides, we remain confident in the future of theatrical moviegoing based on a robust content lineup in the fourth quarter.”

Cinemark Announces New Deals With Studios to Exhibit Movies Theatrically

Cinemark, the nation’s No. 3 movie theater chain, May 7 announced it has reached agreements to theatrically showcase films from five major studio partners across its U.S. screens.

This announcement builds upon the exhibitor’s November agreement with Universal Pictures and includes agreements with Warner Bros. Pictures, The Walt Disney Co., Paramount Pictures and Sony Pictures Entertainment.

Collectively, the agreements secure a consistent supply of content and demonstrate a shared commitment to offering consumers the ultimate movie-viewing experience, with compelling content exhibited within the theatrical environment, according to Cinemark.

The agreements come on the heels of Cinemark inking distribution of Netflix original movies in an abbreviated theatrical window — the first for the streamer. Cinemark isn’t divulging specifics on the studio deals, citing “unique attributes” specific to each studio that mutually benefits both parties.

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With many studios also operating direct-to-consumer distribution through streaming and premium VOD, exhibitors are having to re-visit legacy theatrical window agreements to remake them to better reflect the changing consumer access to screen entertainment.

“In our ongoing efforts to maximize attendance and box office during the pandemic and beyond, our goal is to provide the widest range of content with terms that are in the best long-term interests of Cinemark, our studio partners and moviegoers,” CEO Mark Zoradi said in a statement. “We are pleased with these recent developments and are confident we are taking positive steps toward reigniting theatrical exhibition and evolving the industry for a post-pandemic landscape.”

The new distribution agreements come as Cinemark attempts to claw its way out of a financial hole caused by the pandemic. The chain said it attracted 7.7 million moviegoers and $114.5 million in revenue in the first quarter (ended March 31). That compared with $543.6 million in revenue during the previous-year period. Its net loss ballooned to $208.2 million, compared with a loss of $59.6 million in the previous year period.

Netflix, Cinemark Partner for Zack Synder’s ‘Army of the Dead’ Theatrical Distribution

Cinemark, the nation’s No. 3 theatrical chain, and Netflix have partnered for the pending release of the streamer’s original movie Army of the Dead from director Zack Snyder. Cinemark will release the movie on its screens in both Cinemark XD and Digital Cinema beginning May 14. Cinemark XD is a projector capable of 35 trillion colors and custom surround sound that makes moviegoers feel part of the on-screen action.

Tickets are on sale now at Cinemark.com and on the Cinemark mobile app to watch the zombie movie before it is available on Netflix on May 21.

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Army of the Dead stars Dave Bautista, Ella Purnell, Omari Hardwick, Ana de la Reguera, Theo Rossi, Matthias Schweighöfer, Nora Arnezeder, Hiroyuki Sanada, and Garret Dillahunt, Tig Notaro, Raúl Castillo, Huma Qureshi and Samantha Win as a group of mercenaries who travel to Las Vegas to pull off a casino heist during a zombie apocalypse.

“Cinemark is excited to work with Netflix on our first wide release … in our theaters across the U.S.,” Justin McDaniel, SVP of global content strategy, said in a statement. “Zack Snyder fans will love seeing the action in an immersive, cinematic environment with larger-than-life sight and sound technology.”

Netflix heretofore has insisted any theatrical release of an original movie coincide with simultaneous streaming access worldwide, a stance that has resulted in most exhibitors boycotting Netflix movies.

Cinemark and Netflix have worked together on limited releases that put multiple films on the big screen. While this is the first wide release of a Netflix film at Cinemark theaters, the companies expect to work together on future releases.

“Following the success of our limited-run in-theater tests with Ma Rainey’s Black Bottom, The Midnight Sky and The Christmas Chronicles 2, we are looking forward to the wider theatrical release of Army of the Dead,” said Spencer Klein, head of distribution at Netflix. “We are thrilled to offer consumers the opportunity to watch this highly anticipated film in theaters and on Netflix.”

Netflix Quietly Bows Movies in Theaters — Ahead of Streaming

Netflix was the first movie producer to flaunt the traditional theatrical window, contending its original feature films should be made available to subscribers concurrently with any box office exhibition. The streamer’s stance angered exhibitors, resulting in most Netflix movies being boycotted by theatrical chains.

Then came the pandemic and traditional mindsets and business practices gave way to change.

During the pandemic, Netflix quietly entered the theatrical market after negotiating a distribution deal with No. 3 U.S. exhibitor Cinemark. In November and December, respectively, Netflix released Christmas Chronicles 2 and The Prom on Cinemark screens for an exclusive one-week window before they streamed on the Netflix platform.

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“We assume that Netflix negotiated a much lower film rent fee with Cinemark than studios do for a typical theatrical window, and lower than what Universal Pictures will pay exhibitors for its exclusive 17/31-day windows,” Michael Pachter, media analyst with Wedbush Securities in Los Angeles, wrote in a note.

Netflix, which has become a perennial Oscar contender with its original movies, hasn’t been shy from debuting titles in Los Angeles theaters to assuage industry awards rules. The streamer bowed Klaus, The Two Popes, Marriage Story, The Irishman​, The King and The Laundromat​ on the big screen prior to its platform.

Last year, Netflix acquired the Egyptian Theatre in Los Angeles, in part to debut premiere original movies. American Cinematheque, the nonprofit organization that previously owned the Egyptian, will continue to screen movies on Friday, Saturday and Sunday.

Pachter said Apple TV+ released its original documentary Billie Eilish: The World’s a Little Blurry on its platform day-and-date with a theatrical release. He said tickets were available a week ahead of its Cinemark availability, but it was released on Feb. 26 in theaters and on the streaming platform. With no exclusive theatrical window, Pachter said he believes Apple negotiated a smaller film rental fee with Cinemark compared to what Netflix received, and both streamers received less in compensation than studios with longer exclusive theatrical windows.

“While these are clearly exceptional times and exhibitors are willing to negotiate terms they typically would not have in a pre-COVID environment, we think these types of negotiations will continue, and we expect to see more original content from streamers playing in theatres post-pandemic,” Pachter wrote. “We think exhibitors are now more willing to negotiate favorable terms with far more flexible windows than they had in the past, as long as their counterpart is willing to pay.”

Cinemark CEO ‘Optimistic’ Theaters Fully Operational by Summer

With 75% of Cinemark’s U.S. theaters operating at the end of 2020 due to ongoing pandemic government restrictions, CEO Mark Zoradi expects all remaining screens to be in service by the summer. Cinemark operated 531 theaters and 5,958 screens in the U.S. and Latin America through Dec. 31, 2020.

Speaking on the company’s Feb. 26 fiscal call, Zoradi said he believes screens in Los Angeles and San Francisco can open in the coming weeks, and combined with pending studio releases Cruella (Disney), F9 (Universal), Infinite (Paramount), Minions (Universal) and Top Gun: Maverick (Paramount) in the spring and summer portend a return to normal in Hollywood for the exhibitor business.

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Cinemark CEO Mark Zoradi

“We’re optimistic that we’re going to be able to light up these theaters again come this summer,” Zoradi said, adding the company has been successful adapting to government restrictions and implementing sanitation and safety features in theaters.

“Since we re-opened in June [2020], we have consistently received 96% guest satisfaction scores on Cinemark protecting their health and safety,” he said.

Zoradi said the chain has generated more than 2 million moviegoers through about 150,000 “private watch parties” attracting an average of 13 attendees per group.

“During Q4 alone, private watch parties represented more than 24% of our attendance and box office,” he said, adding that more than 50% of the quarter’s watch parties consumed library content — driven by Warner Bros./New Line’s 2003 release Elf.

“This library content could be watched at home for free on the sofa, but instead, consumers chose to pay $99 to see it in the theater,” Zoradi said. “This reinforces what we recently stated, ‘people are yearning for normality, escape and fun out-of-home opportunity.'”

During Q4, attendance topped 6.6 million patrons, with the average ticket price at $7.42 and concession revenue per patron of $4.75. Admissions revenue reached $49.1 million, concession revenue $31.5 million, and total revenue approached $98.2 million in the period. Net loss in the quarter topped $239 million ($617 million in the year) on revenue of $686 million. That compared with a profit of $191 million on revenue of $3.3 billion in the 2019 fiscal year.