AMC, the largest cinema chain in the U.S., warned investors on Tuesday is in danger of running out of cash by early 2021. Shares of the company tanked by 7.8% in early trading Tuesday. AMC’s stock, which has a market value of $446 million, has plunged 44% this year.

In a public filing, the movie exhibitor said a bare movie slate and lackluster attendance has left its business hemorrhaging cash with little hope of recouping losses in the near future. As of Friday, AMC said, has been able to reopen 494 of its 598 U.S. theaters, but only at a limited capacity of 20% to 40%. The remaining theaters are in California, Maryland, New York, North Carolina, and Washington. These theaters, although only around 17% of the company’s total footprint, represented nearly a fourth of the company’s total revenue last year.

For now, there are only four major films on the slate for the rest of the year: Universal’s “The Croods: A New Age,” Disney’s’ “Free Guy,” Paramount Pictures’ “Coming 2 America” and Warner Bro’s. “Wonder Woman 1984.” And even their release dates could change as coronavirus case numbers continue to rise and some states remain stringent about keeping movie theaters shuttered.

Over the past seven days, the U.S. has been adding about 50,000 new coronavirus cases a day, which is up nearly 13% from a week ago. Public health officials anticipate the virus could spread more rapidly as the weather gets colder and people begin to spend more time indoors. AMC said it is in talks with local and state government officials from these states, but there is no clear timing for when these locations will be able to reopen.

California has loosened restrictions on movie theaters, but only around 139 of the state’s more than 500 cinemas are open. New York’s guidelines have remained firmly against theaters reopening. As of last weekend, only two of New York’s nearly 300 locations were open. Cinema owners have rallied together to try to pressure New York, in particular, to permit theaters to reopen. Studios have made it clear to these operators that if the state does not reopen, major blockbusters will continue to be delayed.

Todd Horwitz Chief Strategist
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