Movie Theater Subscription Services • Page 36

Well yeah, aren't we all in agreement?

 

Lmao. I mean not altogether surprising...hopefully I can just put it to use a good bit before it implodes

 

What does that article say? I don't want to create an account to read it.

 

yea I feel like something is going to give by end of summer.

 

I dunno. I bought a little bit of their stock (probably a bad idea) but it's surprisingly gone up a little since I got it.

They're obviously not sustainable currently, but there's a breaking point where they will be. It's just a matter of if they can survive that long without going under. We'll see what happens. If not MoviePass, I'm sure something else will pop up. They're at the very least, changing the game.

 

Ever since MoviePass drastically cut its price last summer, people in the movie industry have wondered how it will stay afloat financially. Its auditors have the same question.

MoviePass owner, Helios & Matheson Analytics, faces "substantial doubt" about its ability stay in business — as the company continues to burn through cash — its auditor said on Tuesday in the company's long-awaited annual report.

The auditor, Rosenberg Rich Baker Berman & Co., wrote that the company had "suffered recurring losses from operations and negative cash flows from operating activities," adding that this gives it "substantial doubt about the Company's ability to continue as a going concern."

Shares of Helios & Matheson were lower on Tuesday after earlier rising as much as 10%. The annual report filing had been delayed, concerning some analysts.

Helios & Matheson CEO Ted Farnsworth downplayed the significance of the "going concern" warning to Business Insider, saying such a warning was in "pretty much most" 10-K filings when a company is running at a loss. "If they don't raise money, they could go out of business," he continued.

Such statements, though, aren't triggered by a company's profits or losses. Instead, they reflect the auditor's view on how viable a company is in the year forward.

MoviePass has warned investors that it needs to be able to raise funds to continue growing. "Our ability to continue as a going concern will be determined by our ability to obtain additional funding in the short term to enable us to continue the development and integration of our MoviePass business," it says in the report.

Since MoviePass dropped its subscription price to $9.95 a month last summer, which allows members to see one movie per day in theaters, it has shaken up the industry. It has attracted millions of new subscribers, but many have questioned how it will continue to sustain itself financially given that it's paying most theaters full price for movie tickets.

The company recently told Variety that MoviePass CEO Mitch Lowe and Farnsworth had, since last summer, together raised $280 million and secured a $375 million line of credit to fund the business.

Continuing to spend

Helios & Matheson reported a loss of $150.8 million for last year, "primarily due to the acquisition of MoviePass," according to the filing. That's compared with a loss of $7.4 million in 2016.

Farnsworth emphasized to Business Insider that the $150.8 million wasn't an entire cash loss for the company.

"Out of the $150 million, basically $110 million is all non-cash — derivative accounting," Farnsworth told Business Insider Tuesday. "The gross loss is only $10 million cash."

MoviePass is continuing to spend. The company acquired Moviefone from Verizon in early April, reportedly paying Verizon $23 million for the movie-ticket site — $1 million in cash and a mix of Helios & Matheson stock and warrants worth about $22 million.

Farnsworth said he will continue to fund MoviePass through Helios & Matheson and that the plan is to use Moviefone as an ad sales source for MoviePass.

"I'm the biggest fan because I see what's going on from the inside and what Mitch is creating here," he said.

 

I can see MP selling ad space within its app to increase revenue. Like making you watch a trailer prior to checking-in.

 

That would actually be smart as hell...

 

Just stay in business until 2020. There’s so many big name movies coming out in 2019 that I wouldn’t be able to afford all of it lol

 

I think it will be a gradual process, if they do go out of business

here's hoping they figure it out tho

 

FWIW, there have been similar articles like that since last year when the price dropped. There are lots of skeptics and I don't blame them, but there are also lots of "successful" businesses that took years to become profitable (Uber, Amazon, Netflix)

 

I’ve gotten 2 friends to join moviepass and i can already seeing them not seeing a movie a month so I’ve done my job.

Edit: which I guess is being a bad friend lol

 

Uber's not profitable and is also subsidized by VC money.

 

Lol. Sheesh. Getting a going concern is not normal.

 

Inevitably they have to get a discount rate from the big chains. There is plenty of evidence that people go to see movies that they would have skipped if it were not for MoviePass, so it needs to be communicated to theaters that they stand to gain from a reduced rate. You get into an issue with MoviePass being used on a crowded opening night versus Tuesday afternoon matinees, but the theaters can benefit from a 70 percent ticket rate and concession purchases more than they can if it goes away.

 

Thinking of using this to go see Krystal today. Anyone seen it yet? It's down to that or Leisure Seeker. They both leave the indie theater tomorrow, which I didn't realize when I saw Blockers yesterday, so I can only see one.

I should also probably see Isle of Dogs at some point, but don't really have any desire to.

 

Isle of Dogs is your best bet, but between Leisure Seeker and Krystal, I'd probably go with Leisure Seeker. I saw the first 40 minutes of Krystal and decided to jump theaters to watch Ready Player One instead. Krystal was all over the place.

 

The trailer definitely looked all over the place, but it has a pretty intriguing cast. My grandmother has Alzheimer's so I'm not sure I want that gut punch from Leisure Seeker, but the trailer really did look wonderful. I think I'm hesitant on Isle of Dogs because I've yet to make it through an entire Anderson film (of the 5 I've tried).

 

Wow. Not a Wes Anderson fan? Well... maybe you'll enjoy Krystal. Leisure Seeker is probably a bit heavier.

 

I probably was too young and didn’t “get” them. It’s kinda looking like I won’t get out for a matinee anyway now so who knows what I’ll see next.

Taking my mom to see Black Panther on Saturday.

 

Card came today! Just in time for Super Troopers, haha

 

I kind of agree that it seems like a no brainer for theaters to team up with moviepass. They have to make so much money they would have never made simply by concessions. Moviegoing is a dying business bc of the cost, moviepass is making it affordable again and following business models that millennials are frankly coming to expect

 

So if anyone cares about my shitty experiences and shitty updates...I ordered my card on 2/28 and after several contacts to customer service, I received (3) different cards on Tuesday, none of which are activating...Good times.

 

I go to movies and never order anything. I wonder how much concession prices have gone up since MP, or if there's a handful of people like me who never get anything.

 

I feel bad for you guys that just can't get your cards. I have had to get 2 because 1 was the gift and the other was my actual subscription and they've both come in a week. It is strange how inconsistent it is for some others.

Also, since MP I've been spending money at the concessions which I rarely, rarely ever did. Not every time, but definitely more than before. Seems like a great deal for theaters because aren't they still getting the money for the ticket? Or do I not get it at all? Haha.