It looks like MoviePass’ pain is becoming AMC’s gain.
As the cinema industry’s chief disruptor continues to flail, AMC Theatres is boasting about the growth of its own new $20-a-month subscription service.
Leawood, Kan.-based AMC, owner of the world’s largest theater circuit, on Thursday said its Stubs A-List program has grown to 260,000 subscribers in its first seven weeks. It previously reported 175,000 sign-ups in the first five weeks of the deal, which offers up to three tickets a week for its monthly fee.
AMC said the service, an extension of the company’s loyalty program, has accounted for about 1 million admissions, or roughly 4% of attendance at the company’s U.S. theaters. The company announced the new offering in June to fend off New York-based MoviePass, which shook up the industry by offering a movie a day for less than $10 a month.
“This is very good for AMC and very good for our movie studio partners as well,” AMC Chief Executive Adam Aron said in a statement. “While one would think that the rate of sign-ups will inevitably have to slow down at some point, enrollments now are continuing at quite a brisk pace, getting AMC to scale much sooner than we initially anticipated.”
Aron and AMC’s boasts come as MoviePass, owned by data firm Helios and Matheson Analytics Inc., is trying to stay afloat after rapid growth exceeding 3 million subscribers. AMC has been highly critical of MoviePass since it reduced its monthly fee to $9.95, calling it a “fringe player” with an unsustainable business model.
MoviePass subscribers struggled to cancel their subscriptions this week after the company reduced its deal to three movies a month in an effort to cut the rate at which it burns cash. Helios and Matheson on Tuesday reported an operating loss of $126.6 million in the second quarter, thanks to MoviePass’ business model of paying full price for each ticket.
Nonetheless, MoviePass continued to brag about its achievements on Wednesday, saying it accounts for 6% of all movie tickets sold domestically.
On Thursday, MoviePass told subscribers in an email that “for the time being,” it will curtail its offerings: They will be able to choose among six or fewer film titles each day, and showtimes will also be limited, it said.
Helios and Matheson’s stock price has plummeted nearly 100% this year to 3 cents a share, putting it in danger of being delisted from the Nasdaq.
AMC’s disclosure comes after the company, owned by China’s Dalian Wanda Group, faced numerous questions about the program on its recent conference call with analysts after it reported quarterly earnings.
One of the long-term questions is whether the $20 price point for up to 12 movies a month will prove sustainable while driving attendance, or if heavy usage will hurt profitability by cannibalizing full-price ticket sales, including Imax screenings. Aron said he was confident in the monthly fees, because they are twice as high as the competition, but would continue to monitor the situation closely.
AMC stock rose 2.3% to $18.10 in Thursday trading. The shares have surged more than 20% this year, thanks to an uptick in domestic box office sales compared to a dismal 2017.