Raphael Stevens

The domestic box office is on the rebound, but AMC’s debt load is preventing it from fully capitalizing on the revival.
The company has more than $4 billion in long-term debt on the books and interest payments weigh heavily on its bottom line.
But, AMC is taking strides to improve its revenue and coax lapsed moviegoers back into its theaters with premium screens and specialty popcorn buckets.

Cars drive near an AMC Theater in New York City on March 29, 2023.
Leonardo Munoz | View Press | Corbis News | Getty Images

The domestic box office is on the rebound, having posted its highest third-quarter ticket sales since the pandemic. The world’s largest movie theater chain, however, isn’t on such solid footing.
AMC operates around 900 theaters and 10,000 screens globally, a larger footprint than its chief rivals Cinemark and Regal. Yet it’s struggled with a hefty debt load, even before the pandemic, that may be preventing the company from fully capitalizing on the theater industry’s revival.

CEO Adam Aron, who took the company’s helm in 2015, spent much of his early days in the job acquiring other chains and outfitting existing theaters with luxury seating. By the time the Covid pandemic shuttered theaters and shut down Hollywood, AMC was already $5 billion in the red.
Four years later, the company still has more than $4 billion in long-term debt on the books. While it has managed to refinance and extend its maturities to 2029 and beyond, interest payments continue to weigh on its bottom line.
“They’ve taken moves to reduce their debt, but they still have a lot of debt and they’re still paying pretty high interest rates on it,” said Eric Wold, analyst at B. Riley.
In the third quarter, AMC’s revenue outpaced its spending, but around $100 million in interest payments pushed the company to a nearly $21 million loss for the period.
“I don’t think it’ll be consistently profitable for a number of years,” said Wold.

In the meantime, AMC is taking strides to improve its revenue and coax lapsed moviegoers back into its theaters, analysts told CNBC. With improved and robust movie slates prepared for 2025 and 2026, the cinema chain has opportunities to leverage improving box office trends — if it can keep an eye on cash flow.

A boost from a blockbuster-filled slate

The domestic box office reached $2.71 billion in ticket sales during the third quarter, a little less than a percent higher than the same period last year, according to data from Comscore. The improvement, though small, is impressive considering the same time frame in 2023 featured the blockbuster cultural phenomenon known as “Barbenheimer.”
The dual release of Warner Bros.’ “Barbie” and Universal’s “Oppenheimer” took the box office by storm, generating nearly $250 million domestically on opening weekend. The pair of films went on to secure nearly $1 billion in North America as part of a nearly $2.4 billion global haul.
This year, the third quarter was aided by Disney and Marvel’s “Deadpool & Wolverine,” which tallied $631 million domestically between its July 26 release and September 30, alongside around $360 million from Universal’s “Despicable Me 4,” $267 million from Universal’s “Twisters,” $250 million from Warner Bros.’ “Beetlejuice Beetlejuice” and $183 million from Disney and Pixar’s “Inside Out 2,” which was released in June.
Despite the better-than-expected box office performance, AMC saw a 12% decline in attendance during the period. Cinemark, for comparison, saw just a 2.4% decrease in attendance globally during the quarter.

Hugh Jackman and Ryan Reynolds star in Marvel’s “Deadpool & Wolverine.”

AMC attributed the decline to a Hollywood film slate that it says didn’t resonate as well in Europe as it did in North America, noting attendance was down 16% in the region. The majority of AMC’s theaters, around 62%, are in the U.S., while Europe accounts for around 37% of its footprint. An additional 1.4% are in Saudi Arabia, according to reports filed in February.
And, it noted, the success of “Barbie” and “Oppenheimer” during the same period a year prior led to more difficult comparisons.
AMC also called out a third-quarter decline in moviegoing in urban centers like New York and Los Angeles, where the company has its largest presence. Wold noted that was likely because the summer film slate was heavily populated with family-friendly films, which typically draw audiences in more suburban areas.
AMC should be in better shape in the fourth quarter as Universal’s “Wicked,” Paramount’s “Gladiator II” and Disney’s “Moana 2” battle for share of premium large format screens during the Thanksgiving holiday. Additionally, Disney’s “Mufasa: The Lion King” arrives in December alongside Sony’s R-rated “Kraven the Hunter” and Paramount’s “Sonic the Hedgehog 3.”

Wicked, Gladiator II, and Moana 2 Movie Posters.
Sources: Universal (L), Paramount (C) and Disney (R)

Looking forward, the 2025 slate and 2026 are expected to be even better as Hollywood production, which was disrupted in 2023 by dual labor strikes, returns to its normal churn of releases.
While the third quarter of 2024 saw 31 wide releases — films that opened in or eventually played in over 1,500 locations — higher than the totals in both 2023 and 2019, the number of wide releases for the full year still lags behind pre-pandemic levels.
More than half of next year’s releases are tied to existing movie franchise or to popular intellectual properties, which could lure baked-in fanbases to the theaters, but also likely means they’ll will vie for time in premium large format theaters.

The premium push

AMC theaters currently house nearly half of all IMAX’s U.S. screens and all of Dolby’s Dolby Cinema-branded U.S. screens. In total it has more than 550 premium large format screens globally.
And the company plans to invest in even more.
“From our patronage data, we know with certainty that moviegoers increasingly seek out our premium large-format screens,” Aron said during AMC’s third-quarter earnings call earlier this month. “On average, our PLF screens in the U.S., for example, do about quadruple the revenues of our non-PLF houses. You all know the saying, ‘Fish where the fish are.'”
As part of what AMC is calling its “Go Plan,” the company is set to invest between $1 billion and $1.5 billion over the next four to seven years to enhance its theaters in the U.S. and Europe. This includes adding more IMAX screens and updating existing ones with new laser projectors, increasing the number of Dolby Cinemas at AMC locations, and updating auditoriums where the screen is at least 40-feet wide to be part of its XL branding and 4K laser projection.

General atmosphere during the Imax private screening for the movie “First Man” at an Imax AMC Theater in New York City on Oct. 10, 2018.
Lars Niki | Getty Images Entertainment | Getty Images

“As [AMC is] approaching 2025, and its really improved release slate, they’re also looking at where to spend money, where to invest in the business and enhance the business wherever they can,” said Alicia Reese, an analyst at Wedbush. “They talked a lot about new investments and upgrading their theaters and expanding their premium screens, adding XL screens. That’s a lot of money, a lot of capex. And I just think they need to approach this in a very balanced way. You know, preserving cash.”
Reese isn’t the only Wall Street analysts suggesting AMC exercise caution as it makes these upgrades.
Eric Handler at Roth Capital Markets noted that the upcoming slate of films will allow the company, which has had to be “very frugal with their cash” in recent years, to make much needed updates, but “they can’t go crazy.”
“They still got to be judicious with their cash flow,” he said.

More shares, more problems?

To raise cash, AMC has traditionally turned to issuing more shares.
The company raised billions during the Covid pandemic by selling new stock, which helped it to pay off its debts and stave off bankruptcy during a time when movie theaters were closed or had limited product to screen to audiences.
However, investors, including AMC’s most stalwart fans, have come to fear dilution and, in the past, have rejected the company’s efforts to issue additional stock. Currently, AMC has around 372 million shares outstanding, according to FactSet.
“They said they would consider using their equity to fund capex projects,” Handler said. “And here we are again. If you’re an equity investor, you may be further diluted down to fund these capex projects. They may issue more shares, and, you know, the number of shares are up like 20 times from pre-pandemic. So, equity shareholders have yet to really reap the benefits of the improvements in the business.”
While AMC’s stock has made some gains in the last month, shares have fallen more than 26% so far this year and are down more than 43% since the same time last year. The stock has fluctuated between $4 and $5 apiece for months.
In the meantime, AMC has been closing underperforming theaters as their leases come up for renegotiation, saving some cash for other ventures.
“They’re trying to shift the footprint so that they maintain their market share gains,” said Reese. “They continue to improve revenue per screen and revenue per attendee with merchandising and popcorn buckets and the like. So, all the metrics are going in the right direction.”
Disclosure: Comcast is the parent company of NBCUniversal and CNBC. NBCUniversal is the distributor of “Wicked.” More

Spirit Airlines filed for Chapter 11 bankruptcy protection.
The budget-travel icon said it will continue to fly.
Spirit Airlines will have time and protection to restructure so it can continue flying and bringing in needed cash.

A passenger waits for assistance at the Spirit Airlines check-in counter in the Austin-Bergstrom International Airport on November 13, 2024 in Austin, Texas. 
Brandon Bell | Getty Images

Spirit Airlines has filed for Chapter 11 bankruptcy protection, becoming the first major U.S. passenger carrier to do so since American Airlines 13 years ago.
The budget-travel icon is not shutting down, however. The filing will buy Spirit time and protection to restructure so the carrier can continue flying and bringing in sorely needed cash.

CEO Ted Christie wrote to customers on Monday to reassure them that they can continue to book flights and use loyalty points or credits normally.
Here’s what travelers need to know:

Why did Spirit file for bankruptcy?

Spirit Airlines has been losing money since 2019, but its financial woes worsened after the pandemic, when industry costs climbed, dozens of its Airbus jets were grounded because of an engine recall and a federal judge blocked Spirit’s planned acquisition by JetBlue Airways.
The airline had struggled to renegotiate its $1.1 billion in debt payments due next year. A deadline at the end of the year tied to its credit-card processing agreement was fast approaching.
Spirit said Monday that it has reached a prearranged deal with the majority of its bondholders for a “streamlined” Chapter 11 bankruptcy protection plan. It expects to exit that process in the first quarter of 2025.

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Is my flight still happening?

Filing for Chapter 11 bankruptcy protection doesn’t mean the airline will cease operations. Rather, it gives the airline protection to reorganize its business, which often means shedding assets or parts of its operation.
“From a consumer standpoint, you’ll need to pay attention if Spirit makes any schedule changes or if they’re going to get rid of any aircraft, lay off any pilots and flight attendants — that will affect the traveling public,” said Henry Harteveldt, founder of travel consulting firm Atmosphere Research Group.
The carrier is likely to keep as much of its schedule as possible in place for the holiday season, when airlines generate a lot of revenue during the popular travel period, but additional cuts are likely not far behind.

What am I entitled to if Spirit cancels my flight?

Under U.S. rules, airline customers are entitled to a cash refund if the airline cancels their flight and they’re not rebooked. Spirit Airlines said Monday that plans to continue flying and CEO Ted Christie tried to reassure customers, whose bookings will bring in needed cash during the peak holiday season.
However, the DOT warns that bankruptcy protection could make getting a refund harder.
“If the airline or ticket agent has filed for bankruptcy, the company may be temporarily prohibited from providing refunds and/or vouchers — for example, to conserve assets,” according to its website.
The agency says that if an airline that has filed for bankruptcy protection refuses to refund you for a canceled or significantly changed flight, your credit card could provide one under the Fair Credit Billing Act.
Even if you get a refund, however, buying a ticket last minute to replace your original flight could be costly due to high demand and scarce seats. Harteveldt recommends always buying airline tickets with a credit card, which affords customers more cancellation protections than debit cards or cash. Travelers can also book a refundable ticket on another carrier if they are worried, though that can be very costly, too.
Travel insurance might also cover pre-paid expenses if bankruptcy alters airline flights.

What happens next?

This remains to be seen. Spirit expects to exit Chapter 11 bankruptcy protection in the first quarter of next year. Airlines can emerge from this process smaller, more cost-efficient airlines. Other airlines, short on airplanes, could scoop up some of Spirit’s assets.
Spirit had a deal to merge with fellow discounter Frontier before JetBlue swooped in with a rival bid. Frontier and Spirit could attempt a combination again, especially since some industry members think the incoming Trump administration will be relatively friendly toward deal-making. More

Restaurant executives are excited to put 2024 behind them and start the new year.
This year, restaurant bankruptcy filings soared, traffic declined and same-store sales disappointed.
But green shoots, like improving sales, have given executives hope that next year will be different.

A McDonald’s restaurant in El Sobrante, California, on Oct. 23, 2024.
David Paul Morris | Bloomberg | Getty Images

After a tough year for the restaurant industry, executives can’t wait for 2025 to start.
“I don’t know about you guys, but I’m ready for ’24 to be behind us, and I think ’25 is going to be a great year,” Kate Jaspon, CFO of Dunkin’ parent Inspire Brands, said at the Restaurant Finance and Development Conference in Las Vegas this week.

Restaurant bankruptcy filings have soared more than 50% so far in 2024, compared with the year-ago period. Traffic to restaurants open at least a year declined year over year in every month of 2024 through September, according to data from industry tracker Black Box Intelligence. And many of the nation’s largest restaurant chains, from McDonald’s to Starbucks, have disappointed investors with same-store sales declines for at least one quarter.
But green shoots have appeared, fueling tepid optimism for the future of the restaurant industry.
Sales are improving from this summer’s lows. Traffic to fast-food restaurants rose 2.8% in October compared with a year ago, according to data from Revenue Management Solutions. The firm’s data confirms anecdotal evidence from companies like Burger King owner Restaurant Brands International, which said earlier this month that its same-store sales grew in October.
Plus, interest rates are finally falling. Earlier in November, the Federal Reserve approved its second consecutive rate cut. For restaurants, lower interest rates mean that it’s cheaper to finance new locations, fueling growth. Previously, higher interest rates didn’t hurt development much because restaurants were still catching up from pandemic delays and riding the high of the post-Covid sales boom.

Shake Shack storefront with illuminated sign on a bustling street, New York City, New York, October 22, 2024.
Smith Collection | Gado | Archive Photos | Getty Images

At burger chain Shake Shack, higher interest rates in the last few years did not slow down development, according to CFO Katie Fogertey. But she’s expecting a “big boost” in consumer confidence as rates fall.

“If credit becomes cheaper, people feel like they can borrow more, even though it doesn’t make sense that it would necessarily drive a $5 burger spend. It’s just the psychology behind it,” Fogertey told CNBC.
Shake Shack has reported increasing same-store sales every quarter so far this year, even as consumers have been more cautious.
Restaurant valuations are also improving, prompting hope that the market for initial public offerings will finally defrost.
“We’re working with a number of different folks right now on getting ready,” said Piper Sandler managing director Damon Chandik at RFDC. “The window currently is not wide open … I think that just with the traffic pressure that we’ve been seeing across the industry, the bar is particularly high.”
He added that he expects to see some restaurant IPOs next year, hopefully in the first half.

A sign marks the location of a Cava restaurant in Chicago, Illinois, on May 28, 2024.
Scott Olson | Getty Images

No major restaurant company has gone public since Mediterranean restaurant chain Cava’s IPO in June of last year. While Cava’s stock has climbed more than 500% since its debut, its success hasn’t encouraged any other large private restaurant companies to take the plunge. Instead, the broader market conditions have scared off other contenders.
Nearly a year ago, Panera Bread confidentially filed to go public again, but an IPO hasn’t yet come to fruition. Inspire Brands, which is owned by private equity firm Roark Capital, is another likely candidate for a blockbuster IPO in the future. Inspire’s portfolio includes Dunkin’, Buffalo Wild Wings, Jimmy John’s, Sonic, Arby’s and Baskin-Robbins.
Still, it’s not all optimism within the industry.
“I think we’ll still see headwinds next year within the macro and within the industry,” Portillo’s CFO Michelle Hook told CNBC.
The fast-casual chain, best known for its Italian beef sandwiches, has reported falling same-store sales for three straight quarters. Portillo’s has stayed away from some of the discounts offered by others in the restaurant industry, like McDonald’s and Chili’s.
The value wars will likely continue into 2025, pressuring restaurants’ profits and intensifying the competition between chains. For example, McDonald’s plans to unveil a broader value menu in the first quarter, after extending its $5 value meal through the summer and into the winter. For some restaurants, the looming threat of bankruptcy hasn’t disappeared, particularly for the chains that are leaning on discounts to win back customers.
And while a recession looks unlikely next year, the consumer might take longer to bounce back from years of high costs than anticipated. More

More than 70,000 people are expected to be in attendance for Friday’s fight.
The fight has brought in $17.8 million in revenue from ticket sales, according to Most Valuable Promotions.
It is the biggest gate outside of Las Vegas.

(L-R) Mike Tyson, Nakisa Bidarian and Jake Paul pose onstage during the Jake Paul vs. Mike Tyson Boxing match press conference at Texas Live! in Arlington, Texas, on May 16, 2024.
Cooper Neill | Getty Images

The highly anticipated boxing match between Jake Paul and Mike Tyson has already secured its place in the record books.
The fight’s promoter, Most Valuable Promotions, which is co-owned by Paul, told CNBC it expects more than 70,000 people to be in attendance to the Friday night bout at AT&T Stadium in Arlington, Texas. The Dallas Cowboys’ stadium has a seating capacity of 80,000.

The gate receipts alone have brought in $17.8 million in revenue, the promoter said.
That makes it the biggest boxing gate in history outside of Nevada. The previous record was $9 million in gate receipts for the 2021 fight between Canelo Álvarez and Billy Joe Saunders at AT&T Stadium.
MVP said the gate is also higher than any non-Las Vegas UFC fight, other than Conor McGregor versus Eddie Alvarez in New York City in 2016.
Nakisa Bidarian, co-founder of MVP, told CNBC’s “Closing Bell” that both Tyson and Paul will be making eight figures from this fight and Taylor and Serrano will also be having record paydays for women’s boxing.
The fight between Paul, a 27-year-old YouTube influencer-turned-boxer and Tyson, a 58-year-old boxing legend, will air Friday at 8 p.m. ET on Netflix, free to subscribers.

The event will also feature one of the most anticipated women’s boxing rematches in history: undisputed super lightweight champion Katie Taylor versus unified featherweight champion Amanda Serrano.
Netflix has upward of 283 million paid memberships in more than 190 countries. The bout will also be a test for the streamer as it ventures deeper into the sports space and as boxing sidesteps the pay-per-view model.
“Numbers don’t lie,” Paul said Wednesday at a press conference for the fight. “People want to see this and that’s an amazing accomplishment. … This is a statement that we had the biggest live gate outside of Vegas in U.S. boxing history.”
Tickets for the fight on Friday range on StubHub from about $58 to $1,500. MVP has also sold higher-end packages, including a $2 million VIP experience that comes with ringside seats. The promotions company says its 375 VIP seats have officially sold out.
For comparison, Vegas’ biggest fight in history took place in 2015 between Floyd Mayweather Jr. and Manny Pacquiao. That fight took in more than $72 million in tickets, according to the Las Vegas Review-Journal. More

Several pure-play space stocks rallied 20% or more this week, in part driven by what sector analysts called a “Trump-Elon trade.”
Just this week saw Rocket Lab up 41%, Intuitive Machines up 28%, Spire Global up 26%, Planet Labs up 16%, Redwire up 15% and AST SpaceMobile up 10%.
So far in 2024, “space has been one of the best outperformers in the market,” Cantor Fitzgerald analyst Andres Sheppard told CNBC.

A hot fire test of an Archimedes engine, which powers the company’s Neutron rocket.
Rocket Lab

This past week saw several pure-play space stocks rally, with leaders up as much as 20% or more, in part driven by what sector analysts said is a “Trump-Elon trade,” a nod to the relationship between President-elect Donald Trump and SpaceX CEO Elon Musk.
“I don’t think anyone can underplay the potential catalyst that I don’t think many people were talking about before: the most important human in the history of the space industry having the ear of the president-elect, who in his past term found space important enough to create a separate branch of the military,” Andrew Chanin, CEO of ProcureAM, which runs the UFO space-focused ETF, told CNBC.

Just this week saw Rocket Lab up 41%, Intuitive Machines up 28%, Spire Global up 26%, Planet Labs up 16%, Redwire up 15% and AST SpaceMobile up 10%.
Those gains were partly catalyzed by third-quarter results and individual updates, such as Rocket Lab’s progress on Neutron and Spire’s sale of its maritime business to remove debt.
But there is a broader market sentiment that is driving these stocks, too, said Cantor Fitzgerald analyst Andres Sheppard, who has buy ratings on Rocket Lab, Redwire and Intuitive Machines.
“I think there’s definitely a risk-on, post-Trump-win rally that’s being reflected in this industry,” Sheppard told CNBC.
Back out even further to take a year-to-date perspective, and this week’s top-performing space stocks have broken out of a post-SPAC malaise to triple or even quadruple in 2024.

“Space has been one of the best outperformers in the market this year for a handful of these names,” Sheppard said.
“We’re seeing a big increase in investor inbounds,” he continued. “We’re getting calls and emails from institutional investors, which are finally starting to realize that this market is only going to continue to accelerate. It’s only going to continue to proliferate because of national security, because of the Artemis program to get the U.S. astronauts back on the moon, because of Elon [Musk]’s ambitious goals of getting to Mars.”

Read more CNBC space news

Sheppard emphasized that Musk’s company SpaceX being privately held means investors are turning to other companies to get exposure to the space sector. Similarly, ProcureAM’s Chanin believes SpaceX’s dominant position in rocket launches and satellite broadband actually helps companies that have spacecraft looking for a ride to orbit.
“They all benefit from the lower cost of accessing space,” Chanin said.
Notably, this week has also seen a bifurcation between pure-play space stocks. Newer companies that have gone public over the past few years climbed while older “legacy” players slid, such as EchoStar and Viasat, both down more than 10% this week.
Alex King, CEO of Cestrian Capital Research, said that gap represents a changing of the guard between the generations of space companies.
“The need for any of those legacy businesses is declining. … What you’re seeing in space, I think, is a slower evolution of what happens in tech, where it happens really quickly, which is low cost always wins in the end,” King said.
“I think there’s an element of the market working out which of these companies are here to stay and which aren’t,” King added.

Despite the huge year-to-date gains by the top space performers, Sheppard does not see the sector slowing down any time soon.
“The overall sentiment has been very bullish and continues to be bullish, despite the outperformance,” Sheppard said.
That aligns with the views of Rocket Lab CEO Peter Beck, who said during the company’s third-quarter earnings call this week that he expects the incoming Trump administration’s “very strong focus on space” to keep up the industry’s momentum.
“When space wins, Rocket Lab wins,” Beck said. More