AMC CEO slams 'prophets of doom,' says company is 'blazing new trails' as it enters 2024

By James Rogers

"AMC is still here, still innovating," says the company's CEO Adam Aron.

AMC Entertainment Holdings Inc. CEO Adam Aron has slammed the "prophets of doom" who expected to see the company's demise in 2023.

"To the prophets of doom certain that AMC would fail as a company and be forced into bankruptcy court in 2023: It is December 31, so we all know that YOU WERE WRONG," he wrote on X, formerly Twitter, on New Year's Eve. "AMC is still here, still innovating, still blazing new trails. To the rest of you (think Apes) Happy New Year!"

AMC (AMC) has been on a roller-coaster ride over the past few years that took it from a beleaguered pandemic victim to meme-stock phenomenon. The movie theater chain used the steep rise in its share price to tap into equity and debt markets, raising $917 million in January 2021. The investors who turned AMC into a meme stock often refer to themselves as "apes" or "ape nation."

Related: This is what we can expect to see from meme stocks in 2024

In December AMC completed its latest at-the-market equity offering, raising approximately $350 million. AMC's move is the latest in the company's push to reduce its debt burden, which was more than $5 billion in 2022. The equity offering, which was launched Nov. 9, and repurchased debt or exchanged debt for equity, reduced the company's liabilities by $62.28 million, AMC said.

Aron has repeatedly warned that the movie-theater chain faces liquidity challenges.

The original meme-stock darling swung to profit and reported positive net income for the second straight quarter in its third-quarter results in November. AMC ended the quarter with cash of $729.7 million.

Related: GameStop and AMC shares rise, on pace to continue winning streaks

AMC has ridden the popularity of concert movies from big-name stars such as Beyoncé and Taylor Swift in recent months, with "Taylor Swift: The Eras Tour," breaking records after its opening on Oct. 12. During a conference call to discuss AMC's third-quarter results in November, Aron said that Taylor Swift and Beyoncé's movies could pave the way for other concert films at AMC.

But while AMC still grabs plenty of attention, the company no longer fits the bill of a meme stock, according to Alicia Reese, VP of equity research at Wedbush. "AMC has seemingly lost its meme status, its share price having come crashing back down to earth over the past several months, particularly since its APE fold-in and reverse stock split," she told MarketWatch last month.

AMC's shares ended the last session of 2023 at $6.12, a far cry from their high of $393.63 on June 2, 2021, during the meme-stock frenzy.

Related: AMC's strong third-quarter results lift movie-theater stocks

The analyst thinks that in 2024, AMC will continue to issue pre-authorized shares to pay down its high-debt balance, as evidenced by the recent $350 million equity offering. "The company is focused on right-sizing the balance sheet, while attempting to maintain strong relations with the AMC lifers still propping up the stock," said Reese.

Shares of AMC have fallen 83% in the last 12 months, compared with the S&P 500 SPX index's gain of 24.2%. AMC's stock is down 0.5% in premarket trades Tuesday.

-James Rogers

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01-02-24 0904ET

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