Key points
- IMAX operates a global technology platform that provides enhanced moviegoing experiences through licensing, revenue sharing, sales, design, installation, upgrades and maintenance of its systems.
- IMAX returned to profitability with GAAP EPS of 46 cents in 2023 versus a GAAP loss of 40 cents in 2022.
- IMAX is seeing growth outside the US, particularly in China, as Oppenheimer brought in $19 million in revenue.
- 5 titles we like better than IMAX
IMAX Co. New York Stock Exchange: IMAX owns and operates a technology platform specializing in enhancing cinematic experiences. Contrary to popular belief, IMAX does not operate movie theaters or movie theaters. However, they profit from film production and theater business. This is in contrast to the largest theater operator, AMC Entertainment Holdings Inc. New York Stock Exchange: AMCwho has yet to earn a penny since the pandemic.
IMAX is known for its ultra-high resolution screens that can stretch up to 59 feet by 79 feet, combined with cutting-edge audio that creates an immersive experience that moviegoers can’t duplicate at home. While movie theaters are still trying to recover from the pandemic, IMAX is back in the game and continues to widen its moat in the market. discretionary consumption sector.
Multiple revenue streams
The IMAX model includes multiple revenue streams. The company licenses its technology to filmmakers, movie studios and streaming services. Even the most successful films tend to be shot in IMAX, as theaters charge a premium for the experience. IMAX also collects recurring licensing fees from the number of IMAX theaters. IMAX makes money from the sale, leasing and installation of projection and sound systems and other specialized equipment. Most IMAX theaters have a box office revenue sharing agreement with IMAX as they cut the top portion of ticket sales.
Beyond theaters
In addition to movie theaters, IMAX also offers giant-screen installations for entertainment venues, including theme parks, museums, and even high-end home theaters. IMAX has announced a new partnership to install 3 state-of-the-art IMAXs with laser systems at key locations in India. IMAX has the world’s largest movie screen, measuring 8,770 square feet, at the Traumplast Leonberg IMAX in Germany.
China is an engine of growth
IMAX also announced the addition of three new locations in China through its partnership with Bona Film Group, which is expected to begin operations in 2026. China continues to be a growth segment for IMAX.
CEO Rich Gelfond commented: “As IMAX continues to further expand into Chinese films, local language releases from countries like Japan, and new experiences, it is clear that our value proposition for Chinese moviegoers and opportunities for Our business in China is strong.” IMAX has earned more than $19 million from Oppenheimer in China, while Dune 2 has earned more than $15 million to date.
Fourth Quarter 2023 Earnings Summary
IMAX reported fourth-quarter 2023 earnings per share of 17 cents, beating analysts’ estimates of 12 cents. Revenue fell 12.3% year-over-year to $86.02 million versus analysts’ consensus estimates of $85.83 million. The company expected its full-year 2024 box office gross to be in line with its 2023 gross.
Summary of the breakthrough year 2023
For full-year 2023, IMAX earned GAAP EPS of 46 cents versus a loss of 40 cents in full-year 2022. Full-year adjusted EPS was 94 cents, compared to just 6 cents in last year. Net income was $25 million compared to a loss of $23 million a year earlier. System sales activity grew 174% year over year with 129 purchases globally while the company delivered 128 system installations. IMAX’s global box office nearly reached the previous record of $1.1 billion. Cash from operations for the full year increased 3x to $59 million.
Internationalization is the engine of growth
CEO Gelfond highlighted the driver of IMAX’s international growth as the company installed a record 61 systems from strategic Rest of the World (ROW) markets, including Europe, Japan and South Korea. The growth path is long as the current IMAX network has only 47% penetration, leaving the door open for another 2,000 locations worldwide.
Low expectations for the first quarter of 2024
IMAX is expected to earn 9 cents per share in its first-quarter 2024 earnings release on April 25, 2024, down from 16 cents per share in the same period a year ago. Expected revenues are approximately $77.51 million.
Daily mug template
The IMAX daily candlestick chart illustrates a cup pattern. The cupped lip line formed at the swing high of $17.64 on Q4 2023 earnings results on February 28, 2024. Shares fell to the $15.57 support, forming a rounded bottom as they staged a rally towards the cupped lip line ahead of its Q1 2024 earnings release. The daily relative strength index (RSI) remained flat at the 64 band. Pullback support levels are at $16.82 , $15.96, $14.77 and $13.50.
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