IMAX Aims to Brighten Its Future After Mixed Q2 Results

The large-screen company continues to sign new theaters and advance its technology as the premium moviegoing arena gets crowded.
By Buster Coen ,

IMAX Corporation (IMAX) - Get Report , which reported its second quarter earnings on Wednesday, has investors optimistic despite looking unfavorable compared to last year's second quarter. The company reported revenue of $91.7 million and earnings per share of 18 cents, down from Q2 2015, when the company reported earnings of $107.2 million and 40 cents a share.

However, investors saw positive signs in the company's strong number of new installations, which suggests long-term growth. "Q2/16 new signings came in at 94, the highest in recent memory and, to us, this is far more relevant than the performance of the film slate in any given period," financial firm Canaccord Genuity stated in an earnings recap. That number of screen signings was up 217% from the same frame last year.

Additionally, the IMAX release schedule for Q3 looks promising. "Star Trek Beyond" and "Suicide Squad" should perform very well on premium large-format screens, with the latter especially looking poised for a breakout. And September 9 sees the release of Clint Eastwood's "Sully," which was filmed almost entirely on IMAX cameras. That film could be a huge performer for the company in the usually-quiet box office month of September.

Looking into the long-term, IMAX is installing new technology that should help strengthen its appeal among moviegoers looking for a premium experience. The company is rolling out a new generation of laser technology, which IMAX promises will provide audiences with the "sharpest, brightest, clearest, and most vivid digital pictures ever." While that may be hyperbolic, the new technology consumes much less power than the previous generation of laser technology, and as a result, it should be popular among exhibitors.

It's certainly a good sign that IMAX has not gotten complacent, because, as previously reported here at TheStreet, the premium moviegoing market is heating up. Reclining seats, in-theater dining and other brands of premium-large-format (PLF) screens will soon compete with IMAX. The company is, therefore, going to have to work hard to remain the top choice for audiences looking to spend an extra $5 to $10 at the theater.

However, IMAX is playing its cards right for now by increasing signings worldwide and advancing its technology. As long as it continues to do so, and directors like Eastwood and Christopher Nolan remain enamored with IMAX cameras, the large-screen company should do well for itself in the foreseeable future.

Loading ...