The "flying high" relates to the recent opening of Paramount Pictures wide-release movie “A Quiet Place Part II,” which pulled in a healthy $58 million for its opening Memorial Day weekend.
Some more good news: Due to the pandemic, there is a surfeit of major theatrical franchise movies backed up from a year ago. The supply-and-demand situation looks to be jammed as movie theaters continue to fully open their cinemas this summer.
Estimates are that over 70% of all U.S. movie theaters are open.
The iffy news: AMC Entertainment the biggest U.S. theater chain’s stock keeps rising -- but not because of financial fundamentals, just on small investor speculation. The counter-argument is AMC is a “meme” stock -- fueled by social-media activity, which disregards, in large part, financial data, according to numerous analysts.
But at the same time, other big U.S. theater chains, Cinemark and IMAX, have been downgraded by Goldman Sachs.
Now add those major connected TV, home-based premium streamers to the picture.
We are still digesting the results of new business gains from consumers willing to watch all kinds of premium entertainment in their living rooms -- in particular highly sought after “theatrical” movies intended for cinemas.
Significant subscription dollars are ramping up Netflix, Disney+ and HBO Max, Peacock and others. And it’s coming from someplace -- not just traditional pay TV providers.
All to say, you have to believe some piece of the theatrical movie audience won’t be coming back. Perhaps 10%, maybe 5%?
Let’s look at a longer key movie theater business trend where some of these metrics reside. Movie theater attendance has been steadily going down -- even before the pandemic -- as movie ticket pricing keeps climbing. In 2019, U.S. movie attendance fell 5% to 1.24 billion over 2018, according to the Motion Picture Association.
Before we all get too crazy, also consider what typically happens when the fall and winter season rolls around: People can get a bit under the weather. No, not generally Covid. But with the other common winter season affliction, the flu -- a regular historical occurrence for decades.
How many people will be spooked into just staying at home -- even a little bit -- to see “The Matrix 4”, “Downton Abbey 2” or “Spider-Man: No Way Home”? Being at home will be one answer. Then think about consumer memories the year after that.