An Imax private screening for the movie “First Man” at an AMC theater in New York on Oct. 10, 2018.

Lars Niki | Getty Images Entertainment | Getty Images

The theatrical industry is in flux — and one stock is rising above the rest.

Imax saw its shares jump more than 44% in 2025, even before the company announced that it had generated a record $1.28 billion at the global box office for the year. Those ticket sales marked a more than 40% increase over 2024 and were 13% higher than its previous record set in 2019.

Meanwhile, shares of fellow theatrical stocks AMC, Cinemark and Marcus Theatres cratered in 2025. AMC was down more than 60%, Cinemark’s stock fell 25% and Marcus Corp., which operates theaters and hotel chains, slumped around 28%.

The sharp declines on Wall Street come as theater operators struggle to grapple with massive changes in the industry.

Domestic ticket sales have rebounded from the record lows posted during the Covid pandemic, but remain about 25% below the the record-breaking $11.8 billion collected in 2018. The 2025 box office fell short of the $9 billion analysts had projected heading into the year, signaling to industry watchdogs that post-pandemic hurdles could be more permanent than anticipated.

“In an environment where consumer spending headwinds and economic concerns forced consumers to be choiceful with their entertainment spending, streaming services continue to represent an attractive option,” Eric Wold, executive director of equity research at Texas Capital Securities, told CNBC.

At the same time that consumer habits have shifted toward the home entertainment market, Hollywood is producing fewer films.

A combination of Wall Street penny-pinching, studio mergers and lingering production shutdowns from the pandemic and dual labor strikes has led to a significant drop-off in the number of movies hitting theaters.

“I think investors are still struggling with, and frankly, what everyone within the industry is still trying to figure out is, what is the real new normal for box office?” said Robert Fishman, senior research analyst at MoffettNathanson.

The winnowing of theatrical has left Imax ahead of the pack.

Move toward premium

When the theatrical slate is thin, Imax benefits, because when moviegoers do decide to leave their couches they are opting more and more for premium large format experiences.

In 2025, more than 16% of tickets sold for domestic showtimes were for these types of theaters, according to data from EntTelligence. That’s up from 15% in 2024 and 13.8% in 2023.

Often called PLFs, premium large format auditoriums are considered an elevated viewing experience, with bigger screens and higher-quality sound systems and seating options — and they come with higher ticket prices.

In 2025, general movie tickets averaged $13.29 apiece, while PLF tickets went for around $17.65 each, EntTelligence data showed. For comparison, premium tickets in 2024 averaged around $16.88 apiece.

As Hollywood shifts toward producing more big-budget blockbuster features — while medium-to-low-budget films are more often sent to streaming — PLF screens will become increasingly important.

After all, the films that benefit the most from PLF ticket sales have been Hollywood’s biggest releases, as audiences want to see explosive action movies and dazzling spectacles in the most state-of-the-art locations.

ScreenX is the world’s first multi-projection cinema with an immersive 270 degree field of view.

CJ 4DPLEX

On the docket for 2026 is Disney’s “Star Wars: The Mandalorian and Grogu,” Universal and Christopher Nolan’s “The Odyssey,” Netflix and Greta Gerwig’s “Narnia” and Warner Bros. and Denis Villeneuve’s “Dune: Part Three.”

All of these films were shot with Imax film cameras and will have theatrical releases on Imax screens.

The company has forecast its 2026 global box office haul at a new record of $1.4 billion.

“We see no signs of slowing down given a very promising slate ahead and the consistency of our market share gains, as filmmakers, studios, and audiences worldwide continue to gravitate toward the Imax experience,” said Rich Gelfond, CEO of Imax, in a statement Wednesday.

As of the end of September, Imax had more than 1,700 locations and a backlog of 478 contracts to build Imax screens. Notably, Imax screens represent less than 1% of the total movie screens worldwide.

Putting up profits

AMC, Cinemark and Marcus all have premium large format movie screens as part of their suite of theaters as well and have invested in creating more of these spaces in their cinemas.

But the chains are playing a game of catch-up.

AMC, in addition to its existing partnership with Imax, has plans to add more Dolby Cinema theaters to its U.S.-based locations as well as Screen X and 4DX auditoriums globally. Cinemark, too, made investments in the last year to add more Screen X theaters to its portfolio.

Of course, these upgrades can be expensive. In the case of AMC, renovations prior to the pandemic saddled the company with billions in debt, which was exacerbated during Covid-related shutdowns. The company is still dealing with this debt load.

Working in Imax’s favor is the fact that the company is notably asset-light, meaning it has minimized its ownership of physical assets like buildings by leveraging its technology and partnering with other companies.

Instead of costly real estate leases, Imax makes deals with cinema chains to install its equipment into their auditoriums and then takes a share of the box office receipts for films screened in those theaters.

AMC, Cinemark, Marcus and other theater operators, on the other hand, have the financial burden of rent and utility payments, which are only partially offset by ticket sales that they split with studios. Concessions — popcorn, soda and specialty food — have become the means for these businesses to drum up enough funds to cover expenses.

But, if the production slate isn’t strong and cinemas don’t have enough content to draw in moviegoers, then profitability is at risk.

In the first quarter of 2025, all three cinema stocks posted net losses. Marcus and Cinemark rebounded to profitability in the second and third quarter, as the calendar of films improved, while AMC posted two more periods in the red.

Imax, on the other hand, was profitable in all three quarters. Through the first nine months of 2025, Imax reported net income of $43 million, up 67% from the same period in 2024.

The theater stocks will all report fourth-quarter results in the coming weeks as earnings reports roll out.

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A man walks past movie posters at at AMC Theater in Montebello, California on May 5, 2025.

Frederic J. Brown | AFP | Getty Images

Movie theater operators woke up Friday to the possibility of a new world order.

Netflix and Warner Bros. Discovery announced a deal for the streaming giant to acquire WBD’s film studio and streaming service, bringing an end to a months-long bidding process that saw Paramount Skydance and Comcast also vying for the assets.

With Netflix as the victor, exhibitors are in a panic.

Unlike traditional movie studios, the streamer has not adhered to conventional theatrical distribution, and there are fears that big changes could be coming to an industry that is still struggling post-pandemic.

“It’s no secret that this was probably the least desired outcome for many theater owners,” said Shawn Robbins, director of analytics at Fandango and founder of Box Office Theory. “There are no two ways around that. This may be one of the most meaningful days in the history of the business, but it could yet be a constructive one for cinema if Netflix honors early indications that it will maintain the theatrical business model of Warner Bros. properties and lean into those unique strengths which are not replicable on the streaming platform.”

Cinema United, the world’s largest exhibition trade association, came out strong Friday morning against the sale of WBD assets to Netflix.

“The proposed acquisition of Warner Bros. by Netflix poses an unprecedented threat to the global exhibition business,” CEO Michael O’Leary said in a statement. “The negative impact of this acquisition will impact theatres from the biggest circuits to one-screen independents in small towns in the United States and around the world.”

A half dozen movie theater operators who spoke to CNBC shared concerns that Netflix’s acquisition of WBD would lead to a significant decline in the number of films made available to cinemas annually and, therefore, hit annual box office ticket sales.

“Netflix’s stated business model does not support theatrical exhibition. In fact, it is the opposite,” O’Leary said.

Cinema United said the deal “would risk removing 25% of the annual domestic box office” putting smaller theater chains and independent cinemas, in particular, at risk.

“We are going to be pulling all of the levers we can because we think that a deal of this magnitude and the potential impact that it will have is something that everyone with regulatory and oversight authority needs to look closely at,” O’Leary said on CNBC’s “Squawk on the Street” Friday. “So, we’ve already been talking to people at the federal level, at the state level and internationally because this is a significant, significant threat, we believe, to the long-term viability of the theatrical exhibition.”

And Cinema United isn’t the only group worried about the future of the industry if the Netflix deal is approved.

A collective of top industry players sent an open letter to Congress detailing the potential economic and institutional blowback that could play out if the merger goes through.

The letter, reported by Variety, stated that Netflix would “effectively hold a noose around the theatrical marketplace” and could alter the footprint of theatrical movies and decrease licensing fees paid in post-theatrical windows.

An uncertain future

Several exhibitors told CNBC that they fear a deal between WBD and Netflix will result in fewer theatrical releases and even shorter theatrical windows for would-be major releases.

Consolidation in the studio space has been a growing issue for the theatrical industry in recent years. When studios merge, they typically decrease the number of films they produce, something the industry saw firsthand when Disney bought 20th Century Fox back in 2019.

The theatrical business has struggled in recent years from pandemic related production shutdowns as well as dual labor strikes that halted film shoots and delayed movie releases. The industry still has not returned to pre-pandemic release numbers or box office ticket sales, and there are worries that it never will.

“If you look historically, when legacy studios are absorbed by other entities, even in the case where those other entities are also legacy studios, the amount of movies produced for theatrical distribution goes down,” O’Leary told CNBC Friday.

Netflix co-CEO Ted Sarandos said during an investor call Friday morning following the deal announcement that planned Warner Bros. releases “will continue to go to the theaters through Warner Bros.”

Sarandos doesn’t plan to alter WBD’s current business practices, a person familiar with the matter told CNBC, speaking on the condition of anonymity to discuss private conversations. Still, he does plan to meet with theater owners in an effort to assuage any concerns and to explain his vision that movies should have shorter exclusive theatrical windows, the person said.

For exhibitors, shrinking theatrical windows pose a major threat.

Prior to the pandemic, movies typically played in theaters for between 70 and 90 days before entering the home market. Following Covid shutdowns, studios and cinemas renegotiated these terms, and the average window fell to 30 to 45 days.

Netflix, however, has never followed these guidelines. The company has long held that its content is meant for its streaming subscribers and therefore should be delivered to them at home, on the service as soon as possible.

If Netflix does release a film in cinemas, it’s usually only for the minimum requirement to be eligible for awards contention or for weekend stints as one-off events.

When Netflix does go to theaters, it doesn’t report box office figures publicly. That’s left industry analysts wondering if the company will continue WBD’s transparency when it comes to ticket sales once the deal is finalized.

“We’ve released about 30 films into theaters this year, so it’s not like we have this opposition to movies in the theaters,” Sarandos said during Friday’s investor call. “My pushback has been mostly in the fact of the long exclusive windows, which we don’t really think are that consumer friendly.”

“Netflix movies will take the same strides they have, which is some of them do have a short run in the theater beforehand, but our primary goal is to bring first-run movies to our members, because that’s what they’re looking for,” he said.

Of course, that strategy could shift in the coming years.

Alicia Reese, an analyst at Wedbush, highlighted in a research note Friday that the theatrical slate has already been negotiated through 2029.

“So any buyer would have to honor those contracts by showing the slated WBD films in theaters for at least the next four years,” Reese wrote.

One theater chain operator, speaking on the condition of anonymity to share candid thoughts, told CNBC, “All exhibition can do is take Netflix at their word.”

“In the deal they have pledged to continue to release legacy WB titles to theatres,” the operator said. “Now does that mean with a one-week window, a four-week window or no window? Netflix will have to diametrically alter their corporate philosophy of streaming first. We just have to wait to see. It’s not great for exhibition.”

— CNBC’s Alex Sherman and Stephen Desaulniers contributed to this report.

Disclosure: Comcast is the parent company of Fandango and NBCUniversal, which owns CNBC. Versant would become the new parent company of Fandango and CNBC upon Comcast’s planned spinoff of Versant.

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