Not surprisingly, subscription growth was subdued. Why? Its previous pricing model was a tiered pricing system with even the lowest level above $10/month. MoviePass has existed since 2011, but until recently didn’t attract much attention. (NYSE: CNK), for example recently unveiled a monthly subscription offering that gives customers discounted movie tickets and 20% off concessions. In fact, rival chains are rolling out their own subscription offerings to fend off Moviepass. So concessions are the key to running a profitable theater chain, and AMC, not surprisingly, resisted MoviePass’ demands for a cut of its main profit stream. It’s worth remembering that the movie producer, not the theater, gets the lion’s share of revenues off ticket sales. Helios and Matheson had wanted $3 from each ticket sold at AMC Entertainment Holdings Inc (NYSE: AMC) along with a cut of concession revenues. The main route to profitability always seemed to be splitting revenues with the theaters. But it’s unclear how effective this will be, particularly in light of data privacy scandals at Facebook, Inc. (NASDAQ: FB) and elsewhere. The company also has suggested that selling customers’ data and arranging directed advertising will lead to revenues. Naturally, though, customers are more motivated by Moviepass’ fixed price in high-cost metro areas. by getting a lot of people in Kansas City and Omaha and places where the average ticket price is five or six bucks to sign up”. The CEO explained it last year as follows: “We need to offset costs in Manhattan and L.A. One such model was going after users in cities with cheaper tickets. Helios and Matheson has offered various explanations for how they would eventually reach profitability. While the stock’s decline is especially dramatic and may seem like a buying opportunity, here are the five reasons why you should steer clear of HMNY here. The majority owner of the MoviePass movie ticket service is running into increasingly grave problems. HMNY stock is down 33% as of this writing following its latest equity offering. and Helios and Matheson Analytics wasn't one of them! That's right - they think these 10 stocks are even better buys.Helios and Matheson Analytics Inc (NASDAQ: HMNY) plunged again on Thursday. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has quadrupled the market.*ĭavid and Tom just revealed what they believe are the 10 best stocks for investors to buy right now. When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. No wonder the 40% drop left MoviePass stock just $0.21 away from becoming a penny stock again.ġ0 stocks we like better than Helios and Matheson Analytics Or MoviePass announces a big stock sale to raise cash to keep itself running - probably as early as Tuesday or Wednesday, and in any event, before the close of the week - and dilutes its existing shareholders down to effectively zero ownership. Thus, two scenarios present themselves: MoviePass runs out of money really quickly, and members can't use their passes again. A further $3.1 million is due to be paid back later this week, and the company will probably be out of money again when the balance comes due on Aug. But $1.2 million of that had to be immediately paid back to the lender. The promissory note that Helios secured Friday raised $6.2 million in cash to keep the MoviePass business on life support.
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