The CEO of AMC Theaters heaped blame on recent failures (like this summer's King Arthur: Legend of the Sword and Baywatch) for what was a slow quarter at the U.S. box office, especially for the world's largest theater chain. Baywatch performed admirably worldwide with $173 million but was a domestic flop earning just $58 million against a $69 million budget. King Arthur, meanwhile, was a worldwide disaster, earning just $143.4 million globally despite costing $175 million to make.
The domestic box office has slowed considerably since a remarkable surge in March, which happened thanks to bona fide hits like Beauty and the Beast and Logan. But even the summer season has had a downturn since the release of Wonder Woman, with this weekend's projections have the 2017 summer down 8% from 2016. Amid a disappointing quarterly earnings report, AMC Theaters CEO Adam Aron believes he knows what was to blame.
As reported by Variety on Friday, AMC reported a loss of $1.35 per share for the period of April-June. Wall St. was expecting a loss of only 11 cents per share. The stock decline comes after profits of 24 cents per share in the same period last year. In a statement, an "extremely disappointed" Aron posited that blockbuster failures were a major cause of the deep plunge in ticket sales, which happened despite the massive success of Wonder Woman.
That said, AMC's reported $1.2 billion revenue only came in a hair below Wall St. expectations of $1.23 billion. The revenue did beat the chain's $764 million last year, but the gains were mostly driven by AMC's acquisition of multiple theater chains in the past year. Aron remains confident that the end of the year will make up for the sunken middle part of the year:
"Consumer demand to ‘go to the movies’ was robust as 2017 started out in the first quarter. And just ahead of us is a strong fourth quarter film slate, that creates the opportunity to lessen the angst surrounding box office weakness industry-wide in the second and third quarters of 2017. As a result, we remain optimistic about our ability to deliver meaningful value to our shareholders both for the balance of 2017 and in the years ahead."
The last quarter of 2017 does have a good chance to see an upward swing at the box office, with Star Wars: The Last Jedi hitting theaters. There's also great potential in upcoming tentpoles like Justice League, Thor: Ragnarok, and Blade Runner 2049. Despite Aron's blame of singular bombs on an industry-wide issue, he has reason to be optimistic that the end-of-year box office will bring another surge.
AMC's stock was reportedly up 2.65% in pre-market trading on Friday, but the company still lost a quarter of its value earlier this week. and despite Aron's salient arguments, the box office problem extends beyond simply one or two disappointing movies. The downturn has stretched into the summer season, leaving the industry depending on a strong close to the year.