2026.09.25 | GP | AMC | AMC & Warner Bros Deal

the Warner Brothers Deal

Primary:

AMC

WBD

Associated:

NFLX

Cineworld Limited

Viewpoint:

Former Executive

Moderator: Oliver Thompson (OT)

| Sep 24, 2026 | 35 Min Read

John Calkins (JC), Former President of Programming - AMC Entertainment

SU MMARY

The discussion focused on the current state and future prospects of AMC Entertainment and the broader cinema exhibition industry. The expert provided insights into the industry's dynamics post-COVID and post-strike, the impact of mergers, and the evolving role of streaming services. The conversation also delved into AMC's strategic positioning, competitive landscape, and potential future innovations.

Key Insights

The expert believes the cinema industry is showing signs of recovery, with potential for growth if AMC can manage its capital structure effectively. AI and technological advancements are seen as opportunities to reduce production costs and improve marketing strategies. The expert highlighted the importance of loyalty programs and subscription models as potential game changers for AMC. There is optimism about the return to moviegoing, with a broader mix of films expected to attract diverse audiences.

Competitive Landscape

Company

Positive Aspects

Negative Aspects

AMC Entertainment

Strong urban demographic, early investment in loyalty programs

Tenuous capital structure, reliance on market recovery

Cinemark

Strong balance sheet pre-COVID, experimenting with adjacent gaming

Less urban demographic focus

Regal/Cineworld

Larger footprint, blue-collar demographic appeal

Overindulgence led to restructuring

Quantitative Insights

Metric

Insight

Ticket Sales Recovery

Industry recovering on fewer ticket sales, indicating higher per capita revenue

Film Slate

Broader mix expected, with more mid-sized films returning to theaters

Pricing Strategy

Ability to increase prices without significant drop in attendance

The expert's analysis suggests that while AMC faces challenges, particularly with its capital structure, there are opportunities for growth and innovation within the industry. The focus on loyalty programs, AI, and strategic pricing could position AMC favorably in the evolving market landscape.

OT: Hi, good afternoon. I'm Oliver Thompson with Guidepoint. Welcome to our call today on AMC Entertainment. If you have any questions, please feel free to email ask@guidepoint.com and I'll try to integrate those questions into our conversation. With that, I'd like to introduce our advisor for today, John Calkins. John, thank you for the time. We're excited to have you.

JC: Yeah, great. Happy to be here.

OT: Could you give a quick overview of your professional background in the industry and with AMC and then we can dive in?

JC: Yeah, sure. Happy to do that. I guess writ large, roughly a 30-year arc in the industry from early days consulting at McKinsey to Warner Brothers and Universal and others to leading corporate development at Warner Brothers and in EVP capacity and then similar role at Sony Pictures and then doing digital distribution at Sony Pictures, which was right around the time of the Netflix growth and the rise of early transactional sell-through and some of those format battles. Segued into AMC, I was president of programming there. That was a role that, because of my home entertainment background, had some elements of MoviePass and subscription, but also a lot of elements around film flow, booking, certainly capital expenditure, so pretty interesting time. Then I had a digital startup that we sold to Philo ultimately called Row 8, and now I'm at National CineMedia in the advertising side. But I think for purposes of this discussion, probably most relevant talking about the industry dynamics from the AMC, you know, sort of Sony days, if you will, and how we've seen that evolve.

OT: Great. I feel like the conversation of the past has been around the meme stock craze and then this post-COVID recovery tied to the slate and how the business fits in its cap structure. I'm curious how you think about the conversation on AMC today, September 2026. In your mind, what are the most important thematic and topical discussions surrounding the business?

JC: Yeah, I think there's always been a couple of cross-currents, notably with AMC. There's certainly an industry film flow element that we'll dive into, and then I think there's been more of a structural question that seems to hit these exhibitors every 15 years or so from whatever causes it. If you look at the 3 main exhibitors, Cinemark going into COVID and the strike had the strongest balance sheet, didn't become a meme stock, didn't require a lot of restructuring, and Regal slash Cineworld on the other side probably caught itself at the wrong moment in a period of overindulgence and actually threw in the towel. AMC's been trying to navigate that, as I'm sure everybody on this call understands. To the extent they've gotten to where they are, one could argue, except for management, maybe a restructure would have been better, but they certainly had a lot of dilution and a lot of excitement along the way. I guess as I think about it now, looking forward, I do personally feel like the bottom to some degree is probably in from an industry perspective. There's a lot of signs of life from the industry perspective. We could call it green shoots, and I'll get into some of those. So if they're at a place where they can handle the capital structure that they have, there are probably shinier days ahead. And by that, I mean some of the uncertainties that overhang the business. The strike was very much a disaster to come on the heels of COVID. All those guild agreements are now in place. There's been no litigation around things like the AI issue and how those have been defined. So I think you might not expect things like a pickup in production going ahead. And if anything, you might expect falling costs of production and better economics, leveraging things like AI, which is something we can dive into some if you'd like. I think there's been also some overhang from things like this Fox-Warner Bros., this Paramount-Warner Bros. merger. I'm not sure how

meaningful the recent settlement with the state's attorneys general is, the dynamic of it at a 30 to 32 film commitment, in the grand scheme of things, the slates from the major studios historically are always about 100. The slates for a functioning studio tends to be 20 to maybe 25 to, as Alan Horn at Warner Bros. used to put it, to have enough volume to keep the engine running, the shelf space at retail for merch, the share of mind for good marketers, to have creative things to work on. If you get under that, the machine doesn't run as well. And in fact, if you get over that, you start to run into things like picking dates, being stretched too thin on how you think about holdovers and protecting your own films. So to me, this 30 to 32, it is nice at 1 level because it kind of keeps the output up, but if you think about what the last 10 films in that 30 are going to be, there would have been natural substitution anyway in the marketplace, other films finding a thing. And I think the ultimate, if you call it 5% lift in value maybe for having that number of films versus just 20 or so. I think it's going to be really, you'll see them pushing films into shoulder periods, which net-net is good for exhibitors. You'll probably see a little bit more breadth across genres, which is also good for exhibitors and good for movie-going behaviors. So you may push some of those middle films at the margin to get into theaters that might not have. And if it's not an aggregate box office list that's meaningful, it may be more of a behavioral one around how consumers think about movie-going. So, on balance, certainly good. The 3,000 screen wide release marker, not so meaningful. Any wide release is going to be at least that. You're sort of in the death zone if you're at 2,000 screens. And then you do smaller ones with a platform release anyway. But like I say, net-net, I think good to have that from the merger perspective. I think the stronger tailwinds in the business. There's some of the research we're seeing back around Gen Alpha in terms of return to movie-going, finding the movie-going experience as a nice and valuable complement versus all the scrolling and the small screen stuff that they get inundated with. So, and the other, I guess, current that's tracking with that is, we're seeing more from streamers, Netflix among them, interest in going to theaters. I think the tailwinds that maybe we've all known for years are getting recognized, which is that theatrical release is how catalogs get valued, how asset bases get built, and how downstream revenues and consumer appeal gets established. And as I think these streamers have to operate more like full-functioning media companies rather than single channels, some of those dynamics come to the forefront and help them in turn attract talent and overall get a better and more valuable slate of content. So I think those, maybe I'll pause there, Oliver, and let you get a question. But I think that. But, as I look at it, you've kind of got a nice base set here and generally what looks like could be some positive dynamics ahead.

OT: Between the pandemic and then the strike, this recovery to pre-2019 levels has been much more turbulent than perhaps anyone would have predicted coming out of the pandemic.

JC: Mm-hmm.

OT: What is your view on the directional health of the slate and how this Warner Brothers deal influences that slate health?

JC: Yeah, good underpinnings. I think the return to moviegoing, at some point we're going to hit that "we're back to where we were" mode. As context for this call, attendance, which the industry no longer reports on, actually peaked in terms of ticket sales in 2002. I did some work in a Regal Cinemas appraisal case, and we dove into this pretty hard to try to figure out whether that deal was done at the right price. But the dynamic from 02 to 19, even as box office continued to expand, was kind of a -0.5% to 1% CAGR, depending on which endpoints and whatever you choose. So at some point, the industry is going to slip back into that mode. There is just a natural competition for eyeballs and time in the marketplace. There's some natural caps on how frequently people can go to theaters, etc. And then what we're seeing now is basically there was a good New York Times article a couple of weeks ago. I think Brooks Barnes was the author of it. They've covered this sort of missing 30% of ticket sales, which I think is about right. It's not a reported number, but that does kind of tie. And so while box office is sort of recovering much more closely to where it used to be, it's doing it on 30% fewer tickets than were sold in 2019. That's obviously a double-edged sword for exhibitors because you live on the per caps as much as you do on the tickets and the movie itself, but what it does sort

of raise is if you can do kind of this level of business at this kind of reduced ticket volume, when does that come back, or does it even need to come all the way back? We're going to have an up, certainly on box this year, but underlying it, we're seeing more attendees than I think have been expected or would have been forecast at the beginning of the year. I think the slate next year is a similar story in terms of wind in the sails, and what I took away from some of the slate analysis that I've done is that you're seeing a broader mix of pictures. If you guys look at things like genres or size of releases, what you see is more that kind of move back into that middle, that middle bucket, and the dynamic there is not complex. These are films that, certainly through COVID, but even to some extent heading into that before COVID happened, they were sort of, A, crowded out of the theatrical schedule, but more importantly, B, you had a very clear, safe, equity valuation underpinned economic sale to a streamer that you could do. So if you had a... making some numbers up here... if you had a $20 million American Pie-style comedy, but it was going to cost you $60 million to market it and put it in theaters. You know, and maybe it's untested IP. You could flip that to Netflix back in the day for 25 or 30, take your chips off the table. Not a sustainable practice with the underlying studio overheads, but at the time, not a bad decision for both parties. And so a lot of that was happening. You sense then or more recently, all these streamers are doing more originals, the equity multiples and the general tolerance for that have come down, the expectations of what you can get out of theaters have come up. And so you're seeing the dynamics we saw this year, you're seeing those kinds of films now legitimately make a theatrical decision where they might not have. We've gotten past the failed Jason Kilar experiment that day and date with HBO and Warner Brothers. So I think the industry has kind of settled now after, as you pointed out, a lot of turmoil on recognizing that, for a film that can draw an audience. It is a better path to try to figure out how to get that in theaters. And I think that's why I like this story much more broadly than just what's happening with Paramount and Warner Brothers. If anything, the sort of a sub concern I might have on the Paramount Warner Brothers 32 film requirement is. Do you wind up because of your debt load sort of maybe under marketing them a little bit to try to shave some of the economics back, for example, right? So it's 32, but maybe they've got the marketing spend of 28. And as any exhibitor would tell you, it's really the marketing spend that is important when you think about a film coming to the exhibitors. So I think we'll see some attendance lift and with it some more box office and general positives, certainly for AMC and everybody in the next year. And if that's where their economics can pencil with the cap structure that they have, there's no reason to think that that is not going to have some stickiness to it. The other side of it is, and feel free to cut me off here if I'm rambling too long, Oliver, is we're largely at the end of the reseeding cycle, which was certainly a use of capital for these guys. You know, they have a lot of food and beverage investment that's now behind them. So some of the uses of capital maybe have relaxed a little bit. And even at the same time, I would say looking ahead, they've got capital that's in there in the form of these digital cinema projectors or in the form of these reserve seating and loyalty program relationships. That is sort of still early days in terms of how you monetize it. And by that I mean, with digital cinema, you could very much see things about more dynamic programming and splitting the show schedule up, kids programming on the same screen in the day as horror movies on in the evening. Or swapping in and out even midweek for more independent films or things like that. You run into some of the Hollywood booking instructions and some of these other kinds of complexities to do it, but these are capabilities, carrying sports programming or other things that you know prior to digital cinema you wouldn't have had because of the sort of awkward nature of film stock. And the same sort of logic you could apply to variable pricing, if you think about pricing seats differently within auditoriums or trying to get more accurate with how you think about midweek pricing. I don't see a lot of dynamic pricing based on film quality, but some of those other dimensions, I think, potentially have some legs to them.

OT: Okay. You touched on the competitive dynamic between the big 3. What are the key reads there? And in the context of AMC, do you see them picking up market share, bleeding it?

JC: Yeah. You know, it's an interesting industry in that they have geographical separation and they do have somewhat of their own characters. But even when you looked at, they used to have these competitive film zones, which was largely out of the Paramount Consent Decree and some of the considerations about how you book theaters. But even back when that was a thing, there were not even 10% of the AMC circuit that was deemed as in a competitive zone

with its competitors. So you might have 2 theaters in LA, but they're on the other sides of a freeway, or they're 3 miles, 4 miles apart. And because of that, because these things pull heavily from local trade areas, both tend to get the opening films if they'd like it. You see sort of less... it's not like gas stations on opposite corners... you see less price competition at the individual theater level, and they really operate in a fairly insulated way. Different theaters will do differently based on the films. My favorite example of that was American Sniper when I was at AMC. That film was the first time Regal actually beat AMC in market share because Regal had much more of a blue-collar, sort of middle America constituency, even though you can see plenty of Regals in some big cities. But AMC was definitely the big- city kind of theater chain. We've always liked, and I don't think it's just AMC eating its own food, the urban sort of population density upscale demographic that AMC tends to have a little more of. Cinemark perhaps behind them, and Regal lagging in that regard. AMC certainly has liked its market share characteristic, although I don't know that it actually gets Material in better terms than anybody else on that. Certainly, when they tried to go global, they didn't see any improvement in booking terms based on doing that because the country's booked locally, and to do that, you'd have to try to trade off one country against the other as leverage, and the market just doesn't work that way. So they truly are local businesses, but I guess the other thing we haven't talked about, which does come up, is, what is their leverage versus studios at the end of the day? And why don't people often ask, why don't the studios just charge more for their films? And the leverage is one of, certainly a geographic, even if you're in Muskogee or a small town, you may say, "Well, gosh, I can charge that guy more," but if you're not in that town, you're not in that town. So the studios recognize that they need broad footprints for these films to get out. And in fact, while as the exhibitor comes up on the release date, the studio may have all kinds of leverage to not give them that Star Wars on that week. They also internally face a lot of pressure well in advance of that release date on, "Have you locked in these auditoriums or these cities yet?" And so the timing of discussion is very different. You know, the talent is like, "Where are we with AMC? What are the terms locked in? Do we have our footprint long before the exhibitor is really focused on, 'Do I have that film to play or not?'" So the industry is kind of struck a balance, I think, in part because of that. And it has blended, it has tended to therefore land in a place where the terms don't just go up year to year. The terms vary based on what the aggregate performance of the box is. So the studio will take a bigger rake for a bigger film, but those basic structures are in place and pretty consistent year to year.

OT: In terms of the durability and sustainability of AMC's current capital structure, how do you view that trajectory of business performance over the next 2 to 3 years? Can they grow into a point where their debt structure today is sustainable?

JC: Yes. Yes. But that said, I haven't done the deep dive on that. So I would, I guess the way I would comment on it is. Clearly, if the bottom falls out or if they have another strike or if they have COVID, they're in a tenuous spot. I think aside from that, given the business dynamics, assuming films continue to flow, assuming the consumers are still turning out, which I fully expect. So if that pencils, as you look at their debt, then they're probably fine. But anybody on this call is going to be closer to that analysis, so I'm not going to try to wing it, if you will, on that, except as to say that, well, let me give you another example of a worry that I think is sometimes out there. Do consumers find other things to do with their time or do they just generally stop going to the movies in faster fashion than just minus 0.5% or 1% per year, which has been more than covered by box growth, et cetera. And there was an analogous, I looked at it as part of this Regal expert witness thing, there was an analogous period in kind of the 60s against the rollout of color television. And in that period of time, in fact, weekly movie going dropped like a stone and that was true. But what didn't happen was once that behavior had reset and the floor was in, if you will, which occurred kind of into the mid-70s, there wasn't further erosion. And in fact, attendance grew from mid-70s right up until 2002. And that was against the backdrop of going from 3 broadcast networks to 400 cable channels. It was a dramatic lift in other things to do like sports and leagues and stadiums and the rollout of things like the VCR to that point. So I think the behavior, the occasion, the notion of going out with a date, intrinsically is somewhat resilient and what has impacted it more and when we broke into kind of there was an 02 to 10 decline that was a little stronger than the 10 to 19 portion of the curve. What tends to impact exhibitors more is when you've got a fundamental technology in the home that is

changing what you can do from the couch. So the color TV one is an obvious one. You didn't have anything really to watch that was any good or quality. And the most correlated technology with the fall off in movie going of that time from an attendance standpoint, and remember it sort of still grew box, but just looking at the underlying consumer behavior, was the rollout of broadband. So the rollout of broadband in the US was truly a 2000 to 2010-11 kind of scenario. And because of that, consumers now had a lot of on-demand programming, so it wasn't just 400 channels to choose from, you could now do an awful lot, and it was also other kinds of programming, YouTube and the like. So that very much was a bigger impact, certainly a bigger impact than anything that Netflix then subsequently put on its own service or other types of films that went direct to consumers in various ways, that technological capability. So I think looking ahead, where I'm going with this is if you try to figure out, okay, what would make that attendance actually fall off a cliff as opposed to business as usual, you would have to say to yourself, is there a technology that's there that's just going to fundamentally shift how the consumers think about their night out? And I don't think AI is that. I think AI at the end of the day is probably beneficial for studios and also potentially beneficial for exhibitors in that you'll just have more content potentially sourced from more directions. But the content itself isn't going to be anything different than what you already have plenty of access to in the home anyway from my point of view. So studios are going to do a lot around taking costs out, reducing additional cinematographers or additional location shoots to figure out which one they want to actually use for the real film. A lot of that stuff can get replaced or taken down. Even around talent, background talent, somewhere the line is going to get drawn and negotiated, but right now it's not speaking talent, but there's plenty of extras and costs and things in there that can get taken out. And the overall falling cost and increasing access to economical ways to produce things should create a nice overlay of whether it's sourced to go work in Hollywood or whether it's actually completed works that still want to get on the big screen. We should see more content, not less, in the same way that we have in music. So net-net, all good, and I don't know that you would conceptualize. If somebody's got an idea, I'm happy to respond to it, but conceptualize something that actually pulls the rug out from under these guys at this point.

OT: Can you elaborate on the leverage of AI, which you referenced, and how you see that influencing AMC's business.

JC: Sure. I think to some degree, it's still conceptual at one level, right? But, if you think about better efficiency, it's certainly ripe for that at all levels of an organization. It should be helpful from a cost perspective therefore and perhaps they're at a scale where they can take advantage of that in the way that some of their smaller competitors might not be as easily positioned to do. You can see roles for it in how they put more value and therefore monetize their loyalty program or their subscription offers. They've gone in and out of home entertainment, but they've had a brand that's associated with movie going. Does an AI driven approach to that marketplace leveraging a larger loyalty program eventually put them in a place where they can make that business work in a way that's material versus the big guys? I don't know. There's certainly some intelligence around things like screening and booking and at this point, somewhat archaically. The booking process which occurs on a weekly basis and has a team of people at each studio and a team of people at each exhibitor, literally arguing on Monday about what screens they're going to hold. For years the industry has sort of under its breath said you could automate the whole thing because there's only about 3% of those screens that are arguable as to should I hold that film or not. So at some point maybe that corner gets turned and that's a nice cost savings for everybody. From the production or content flow side, probably more opportunities there. And, if you were taking the selfish exhibitor view of it, you would say whatever is being saved on the production side could turn into additional marketing or support or holdover support. At the end of the day, the studios exist to try to get the best films to distribute, which means the value that's created from those films tends to either go back to talent... that's why they tend to be thinner margin businesses... or go into supporting that film in a way that makes the impact bigger, the opening weekend bigger. So if you find a way to use AI to let you redirect some of that spending to have bigger openings or better talent or better films, that all runs downstream and benefits the exhibitors as well, of course.

OT: What about opportunities to leverage the real estate and the space to drive better utilization? And where I'm going is potentially adding in adjacent family entertainment solutions. You've got e-gaming and e-sports, and I think about the Taylor Swift era just JC: Mm-hmm.

OT: curious as to you know, how much low-hanging fruit there is to potentially improve the productivity of AMC's square footage from a real estate vantage point.

JC: Yeah, I think there's some... and there's definitely some experiments in that area going on. I think Cinemark's got a sort of an adjacent gaming thing that they're playing around with. It's not a chip-in, though. There's some headwinds to it. And I think it's... somebody has to land on the right format. The obvious ones to reference as case studies, right? Stadium seating, proven to work, industry standard, rollout across the whole thing. Re-seating, right? Re-seating, you take out half to two-thirds of a seat in the auditorium, which people would have thought would be a negative. And we'll be right back. But what they also probably underappreciated that then turned out to actually work is, well, now you would open an opening film on 4 or 5 auditoriums instead of 1. So you didn't really lose all the capacity for that opening film. You got more efficient in terms of having multiple start times better for consumer. Maybe you crowded out week 5 in auditorium 12 of a smaller film, but hey, that's okay because you're going to have net-net more productive use of those auditoriums across all the weeks. But what we haven't seen yet from gaming or sports or alternative content, concerts versus concert films, right, which have some natural film aspects to them, is that killer application. And I think the hurdles are always a little bit subtle. You have these purpose-built auditoriums with 1 single big screen and everybody facing 1 direction, not mingling. So it's not very sports bar-like. Many people that go out to watch sports want to have multiple games on at once, food and beverage or alcohol. So they don't lend themselves to that kind of programming as easily or as well. And the same thing when you think about, if you're putting in different, game sort of activities, usually it's a different seating, if any seating, to use for the footprint. So I think I would zero in on where are those multiplexes that are sort of oversized, the 30-plex, maybe we don't need the 30-plexes anymore. Maybe the... maybe the right size these days is 15 to 18. Could you... could you take that 30-plex and carve off the last 10, flat in some way and do something perhaps? Right, but now you've got a capital spend that's significant. And like I said, we haven't seen that killer, that killer one. And I think what tends to happen, and the reason we haven't seen more of it yet, is you have an opportunity cost and a capex from the demo. And there's enough real estate out there, particularly if you think of where some of the malls have struggled, where it's just easier to do a new build concept than it is to append it to this. And if you're diverting traffic from movie-going over to that, between the cannibalization or the lost revenue while you're building it or the disruption, maybe you're better off as an exhibitor, or anybody, just going out and getting a different out parcel with a fresh concept, new signage, and landing it. But I'm loathe to rule it out. I think you just have a lot more complexity to it. The other thing that I think has been overstated or expected is that we're going to see a ton of screen closures. I don't know that that's the case. It's hard to close 20% of a multiplex, right? And the multiplex at heart probably is still cash flow positive at the margin, or it would have already been closed by now. And you don't want to give up the last trade area because if you're still above water in that trade area, closing the screens is not that good. Maybe you sell it to a lower cost operator, but the US still stays up at the 40,000 or whatever screens that we have out there now with just some trimming around the margins. So that... if you think about the landlord dynamic as well, right? The landlord's not necessarily eager to get some of these purpose- built facilities back, especially so if you've got a mall that's struggling for traffic. So they've been maybe more negotiable on terms than people have appreciated.

OT: You referenced some other signs of life and the green shoots across the industry. Are there any other levers that you haven't touched on?

JC: We probably haven't spent enough time on their loyalty programs, which I think are the potential to be a game changer just from where the energy is in the room. And if you look at the music business where the major artists will

generally, through their loyalty programs as an artist, be able to sell out a venue directly and therefore take most of the ticket price. Movies, you have less of that potential dynamic; it's the studio that's kind of controlling the marketing, so they're bringing the film and the marketing and therefore they've got a pretty strong seat when it comes to earning their 50/60 split. The talent hasn't cut through yet; maybe Christopher Nolan can make a claim at some point, but it's hard to get from here to there on that, particularly if it's a one-off. And we'll see you next time. But the sleeping giant that hasn't really done that much yet is, what really could AMC bring to the table with what it knows about its loyalty members and, could it ever find itself in a position of actually visibly and materially contributing to the opening or the knowledge or the pre-sale or even the positioning or the messaging of a given film and if it could start to play in a different way in the overall ecosystem because of that kind of data or those insights. It would begin to earn back, potentially it's as simple as data money, which they get a little bit of now, but maybe it's even more so, net commissions or pre-sale on ticket kind of benefits in terms of how the splits work for them. But to do that, and I think the heavy lift, right, so it's not on a near-term probability, but I think it is possible, is how do you allocate your dollars? And it's very clear if you've got a reseating initiative, right in the wheelhouse, know what that incremental dollar is worth. If you've got a new menu item, you test it in 2 markets and you roll it out. This kind of data or loyalty program or driving the actual success or opening of a film, really would be leaning in on an awful lot of investment and thinking about the loyalty program in that way and also trying to get over some of the natural headwinds that you'll get when you're favoring a particular film over another starting to steer the audience which your other studio partners might not appreciate so it is kind of a fundamental business rethink in that regard. But I've always... I like what they're doing with subscription. I think anytime you can get multiple business models going around something like that, at least you're starting from the plus column and having more levers to pull. And, from a control their own destiny standpoint, I think AMC is probably better than most because of its size. It's better positioned to try to identify or uncover what that next innovation or that next feature is that the consumers might want. And, they go through all this stuff all the time, but, blankets versus menu items versus subtitles or earpieces and leaning into 3D or not into 3D and, on and on and on. But the industry is pretty good about when something actually shows promise, they kind of get into production and roll it out, with something like alacrity, I guess.

OT: How is AMC positioned relative to the other majors from a loyalty perspective?

JC: I think pretty well. This is more qualitative because I don't have insights into everybody's programs, but they were earlier on investing in the loyalty program. They didn't have the distractions that Regal had rolling through the Cineworld and then it was going to be, the Cineplex acquisition and the restructure, so they had a little bit more time on keeping their eye on the ball on some of that. And they've always seemed like the chain to me that's quicker to test initiatives. I think there's a little bit of a DNA element in how they do it. They've had some CEOs that have come in from outside the industry, which I think has been good. They've been very embracing of hiring out of food and beverage or CPG into areas like marketing or ops. So I think they stack up pretty well. But the other piece that you need to be able to navigate is having the footprint and the size. And I guess the brand permission to do it, the Alamo Drafthouse guys, small, nice chain, but very specific in what the consumers expect out of their Alamo experience. So they're sort of in for a penny, in for a pound on that. It'll be harder for them to test some elements that might be easier for AMC to test. So I think, the big knock against AMC, of course, is its capital structure, which is a function of what it's had to do to survive COVID. But otherwise, it's a pretty long-standing and well-functioning company, in my view.

OT: Can you comment a bit on pricing strategy? And it seems like revenue has been trending in a strong direction primarily based on sort of driving price per patron and per ticket. How JC: Yeah.

OT: Durable, do you see that in terms of driving price versus true attendance volume? And is there any risk of pushing pricing too aggressively where it ultimately hurts the consumer engagement and almost breaks the attendance driver?

JC: Yeah, they've always had a surprising amount of inelasticity in being able to drive price increases without having a real snapback. And I think that's a function of, really, just the nature of moviegoing. So if you think about, am I going to go to a movie? Let's think about the downside, am I going to go on this Friday? I'm going to have to get a sitter, I'm probably going to eat out, I've got to drive 15 minutes across town in the traffic. I've got to coordinate with somebody. There's so much just drag and cost on the fundamental thing that if you tell me my ticket's going to be $8.50 instead of $9, that's not going to get me to go when I wasn't going to go before, right? And then, probably, if you told me it was $7 instead of $9, it wouldn't make a difference. So there's a certain amount of attendance that is viewed as available in the weekend. And if, conversely, you said, look, it's going to be 10 instead of 9, well, I still wanted to see the movie or I was willing to wait for it on Netflix. So I think that's sort of underpinned a lot of this ability to drive price without having a steeper attendance issue. And the other thing that's happening around them in terms of just general entertainment and cost and perceived value of entertainment is, all of the services are taking regular price increases. And at the same time, all of your other options outside the home, remain significantly more expensive than moviegoing. So it's kind of stayed in its lane from an aggregate cost perspective, even as it's driven more value. In terms of, I mentioned, 4-screen openings, so now I've got staggered start times. So, aside from the film, the second main consideration for a consumer is, do I have a start time that kind of works for me? So I've driven more value there. I've given you more seating and I've responded to this, if I am going to come, it better be an awesome experience. So, between IMAX and Dolby Cinema and the other PLFs that everybody has, you see a lot of movement into those because if I'm going to go out. And forego all the other stuff that I have for free, I'm happy to spend an extra $5 and get the biggest screen experience. And so that format shift has been a lot of what the net price increase has been about, coupled with the basic price increase itself. And then they play, they try to be clever about it. You'll hit basic price break points like $9.99 versus $10.50. You put tax on top as opposed to in the price as you get close to that. So maybe it's $9.99, but now tax is on the outside, whereas last year, tax was included. So there's a lot of ways they can kind of do it. They certainly get clever across seniors versus kids, times of day, matinee, and just flipping showtimes in and out of some of those or redrawing where you keep some of those lines helps you manage the perceived creep of that pricing. And then you can track it, and in the case of a big circuit like AMC, you can test it in certain cities before you try it on the whole circuit so you kind of know what you're in for. You can read the cannibalization, like even if you look at something like the discount Tuesdays that I think are pretty normal now, that's Tuesday for a reason, and that's the least cannibalizing day versus anything else so you're going to have a net lift that comes on Tuesday but some of that will have come out of the prior weekend. So they've thought very carefully about how and when to deploy that. But net-net, back, Oliver, to your question, I think there is still more headroom and part of it is because everything around it is also moving up in the nature of the experience that the ticket price is actually only a very small part of your overall cost, whether that's actual dollar cost or just hardship to get off the couch. It's a cost.

OT: Great. Well, John, we're at the hour, so that's a good place to stop for today. Thank you so much for the time, and really enjoyed the conversation, and we'll look forward to speaking with you again in the future.

JC: Yep, for sure. Hope it was helpful. Thanks, everybody.

OT: Thank you, everyone. That concludes our call. Have a good afternoon.

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