AMC Entertainment Holdings, Inc.

Hello and welcome everyone joining today's call. This is the AMC Entertainment Holdings third quarter 2025 earnings webcast. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions in an answer session. To register to ask a question at any time, please press star 1 on your telephone keypad. Please note, this call is being recorded. We are standing by if you should need any assistance. It is now my pleasure to turn the meeting over to John Merriweather. Please go ahead.

Thank you, Sabrina. Good afternoon. I'd like to welcome everyone to AMC's third quarter 2025 earnings webcast. With me this afternoon is Adam Aaron, our chairman and CEO, and Sean Goodman, our chief financial officer. I'd like to remind everyone that some of the comments made by management during this webcast may contain forward-looking statements that are based on management's current expectations. Numerous risks, uncertainties, and other factors may cause actual results to differ materially from those that might be expressed today. Many of these risks and uncertainties are discussed in our most recent public filings, including our most recently filed 10-K and 10-Q. Several of the factors that will determine the company's future results are beyond the ability of the company to control or predict. In light of the uncertainties inherent in any forward-looking statements, listeners are cautioned against relying on these statements. The company undertakes no obligation to revise or update any forward-looking statements, whether as a result of new information or future events. On this webcast, we may reference non-GAAP financial measures, such as adjusted EBITDA and free cash flow, For a full reconciliation of our non-GAAP measures to GAAP results, please see our earnings release posted in the investor relations section of our website earlier this afternoon. After our prepared remarks, there will be a question and answer session. This afternoon's webcast is being recorded, and a replay will be available in the investor relations section of our website at amctheaters.com later today. With that, I'll turn the call over to Adam.

Thank you, John. And good afternoon, everyone. Thank you for joining us today. At AMC, we're especially pleased that with revenue of precisely $1.3 billion and adjusted EBITDA of $122 million, yet again for another quarter, AMC Entertainment comfortably beat Wall Street consensus assessments for both our revenue and adjusted EBITDA. As has often been the case in the recent past, AMC's leading market position and the skills demonstrated in the implementation of our numerous and important marketing, operations, and cost containment strategies allowed us for yet another time to overperform the expectations of those who underestimate us. As we look at AMC's third quarter results, and for that matter the full year to date, calendar year 2025 is turning out exactly, and I mean exactly, as we have long predicted. Due primarily to the timing of major studio film release dates, a weak first quarter was followed by a blazing hot second quarter, which then was followed by a softening third quarter. We continue to expect, however, that the year will culminate in what we hope will be quite a strong year-end in quarter four. Hello, Universal's Wicked for Good. Hello, Disney's Avatar Fire and Ash. Indeed, a broad array of appealing movie titles will be coming out before year-end. Our prediction of a so-so third quarter industry box office turned out to be true, as the North American box office declined some 11% following tough comparisons against last year's strong third quarter. But when evaluating AMC's performance in the context of the third quarter's challenging industry-wide environment, I see our company firing on all cylinders, marketing prowess, operational strengths, financial discipline. All are direct evidence that AMC is very well positioned to capitalize on the box office growth that we believe lies just ahead. Remember that about two-thirds of our incremental revenue drops to the adjusted EBITDA line. So when industry revenues rise, which we believe they will in Q4 of 2025 and again throughout 2026, AMC's financial results should rise even more rapidly. The third quarter energy-wide softness should not be a cause for alarm, nor a harbinger of some negative trend about which to hand-wring or worry. To the contrary, we expect that the fourth quarter energy-wide box office will turn out to be the highest-grossing fourth quarter in six years. We also continue to believe that the size of the 2026 box office will be dramatically larger than that achieved in 2025. There are clearly bright spots in AMC's third quarter financial results that bode well for AMC with an expecting rising industry-wide box office in the fourth quarter of this year and again throughout 2026. Specifically, AMC outperformed the industry, achieving all-time record admissions revenue per patron of $12.25. In addition, food and beverage continues to be a shining success for us as we achieved the second highest food and beverage revenue per patron in our company's entire 105-year history of $7.74. Combining revenue increases with aggressive cost management and It is noteworthy that in the third quarter, we grew our consolidated contribution margin per patron by 9.2% compared to the prior year, and this metric is now approximately 54%, 54% higher than it was pre-pandemic in 2019. The improvements in our efficiency as a company are one of the reasons we are standing proud and tall today. Despite an industry-wide box office that was well below the third quarter of last year, AMC also generated improvements to cash used in operations and in free cash flow when compared to the same time of a year ago. And also, looking at the third quarter, it is especially satisfying to us that in the United States, during the third quarter, AMC significantly increased its market share, so much so that in looking at studio-reported grosses for the full year to date, January and September, AMC's market share increase handily outshined that of any other movie theater circuit in the country. AMC's share now approximates 24% of the domestic box office versus 15% for Regal and 15% for Cinemark. Taking out Canada, where we have no theaters, AMC has a 27% share of the U.S. box office, Regal and Cinemark 16% each. Marcus has just under a 3% share. No other U.S. circuit has even a 2% share. AMC is now about 50% larger than our two next nearest competitors. And we are 10-ish times the size or more of everyone else. Our marketing share increases this year are encouraging to us and a sign that our strategies are working. But it is simply the outsized magnitude of our market share that is so particularly compelling. Because as the box office grows over the next 14 months, as we believe it will, AMC is better poised than anyone else to reap the benefit therefrom. We believe all this sets us up so very well as we look ahead. given what AMC believes will be a rebounding industry-wide box office going forward, coupled, of course, with all the actions and improvements being made specifically within and across AMC theaters in the United States and Odeon Cinemas in Europe. As previously announced... Perhaps more important than any other accomplishment during the third quarter, AMC successfully completed several transformative capital markets transactions that greatly strengthened AMC's financial foundation. We refinanced $173 million of debt maturing in 2026 and equitized $143 million of exchangeable debt. the latter of which in turn was subsequently increased to $183 million of equitized exchangeable debt without the issuance of any additional equity or additional use of cash. Going forward, we will continue to take the necessary actions to enhance our balance sheet and position AMC to capitalize on what we believe will be a multi-year industry recovery. In conclusion, let me add that we are tremendously excited about the film slate coming in the remainder of this fourth quarter, both with blockbuster titles and also with more intimate storytelling. It all starts this weekend with Disney's action-packed Predator Badlands, coupled with Sony Pictures' classics Nuremberg. In November, we also will have Lionsgate, Now You See Me, Now You Don't, Disney's family favorite Zootopia II, Paramount's The Running Man, and Universal's acclaimed and much-awaited return to Oz with Wicked for Good. Not to be outdone, December brings more excitement with Universal's chilling Five Nights at Freddy's, Paramount's animated adventure The SpongeBob Movie Search for SquarePants, Focus features Song Sung Blue, and the third chapter of Disney's epic saga, From the brilliant mind of the legendary James Cameron, Avatar, Fire and Ash. What a lineup of movies. With that and all the other highly anticipated films that will be coming out in November, December in addition, we believe the fourth quarter box office will surpass that of last year and knocks 2025 as the largest post-pandemic box office year yet. Of course, that all depends on ticket sales in November and December. We'll all know for sure in about a couple of months. But to put an exclamation point on that expected box office growth in the near term, if one sets aside the anemic first quarter of 2025, The domestic industry-wide box office has actually been on a $10 billion pace since April 1. That is a number that is so very much larger than the calendar year box office recorded for either 2023, 2024, or the current year, 2025. What's more, knowing of the long list of great titles coming from our studio partners in 2026, We envision a strong and robust film slate is on the horizon for the full year ahead. Sean, let's go into the quarter in more detail.