As cinemas continue to struggle, AMC Entertainment wants to sell its popcorn outside the theaters.
The world’s biggest movie theater chain said Thursday it will begin selling its popcorn at malls, supermarkets, and convenience stores in the US next year, both as a freshly popped option and in microwaveable packages. With the pandemic changing up consumer habits, the movie theater company will also start selling fresh popcorn for takeout, pickup, and delivery—ways of retrieving food that have boomed during the pandemic. The company says it aims to operate up to 15 retail stores in the US—and not all with an AMC theater location—by the end of 2022.
Moving into the multibillion-dollar popcorn market “is natural and logical [for AMC], one wonders why the idea has not been tried before,” said Adam Aron, CEO of AMC, in a press release. The move will help the world’s largest movie theater chain target new audiences and to diversify its revenue streams.
That comes as the pandemic continues to loom over movie theaters. Over Labor Day weekend, AMC saw its highest admissions for that weekend in the company’s history, suggesting movie theaters could recover to pre-pandemic numbers. Total movie ticket sales this year have outpaced 2020’s sales, but they still lag nearly 70% behind 2019’s $11.4 billion haul, reported CNBC.
Popcorn butters up AMC’s bottom line
Though people aren’t yet watching movies like they used to, AMC has used its popcorn as a timely reminder. In June, the movie theater owner, which typically sells up to 52 million popcorn bags a year, offered stockholders free popcorn, in part to embrace its newfound fame as a meme stock, as well as to woo retail investors into buying and holding stock and to vote with management during crunch situations.
This isn’t the first time popcorn has saved the theaters. Until World War II, mainstream movie theaters did not serve popcorn; they aimed to attract a highbrow audience, and didn’t want popcorn droppings to deter audiences and ruin the carpets. During the Great Depression, movie theaters started to go under, but those that began to serve popcorn and other snacks survived—with owners realizing that concessions were their tickets to higher profits. By 1945, over half of all the popcorn in the US was being eaten at movie theaters.
Popcorn is big business for AMC. Food and beverage sales typically account for a third of AMC’s annual revenue. In the first quarter of 2021, food and beverage revenue per patron jumped to a record-high of $7.37, up from $4.76 in the same period of last year, the company said in the first quarter earnings call in May.
As moviegoers trickle back to the theaters, they are pairing their movie with food more than they used to. “What we’ve seen as people are returning to cinemas is more and more people are going to the concession stand,” Aron said to investors and analysts on the second quarter earning’s call in August. “They’re buying food and beverage products because they want the whole experience.”
AMC reports its third quarter earnings after the market closes Monday.
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