- On Tuesday, MoviePass parent company Helios and Matheson Analytics filed an 8-K to the SEC stating it had approximately $43.4 million in cash or on deposit.
- It also reported that after a few tweaks to MoviePass, it reduced its cash deficit during the first week of May by more than 35%.
You might not like that MoviePass will no longer let you use its service to watch the same movie multiple times, but the measure might help the company stay in business.
On Tuesday, MoviePass' parent company, Helios and Matheson Analytics (HMNY), filed a 8-K to the SEC about its current financial situation.
The company said that, as of April 30, it had approximately $43.4 million ($15.5 million in available cash and $27.9 million on deposit with merchant processors), and that its average cash deficit — the amount of money it had been losing — was approximately $21.7 million per month since September 2017.
However, the company also noted that a few changes to MoviePass’ tech and terms of service could help reduce its “monthly cash deficit significantly.”
Helios and Matheson wrote that, in late April, MoviePass enhanced its technology to prevent subscribers from sharing accounts with non-subscribers, and stopped allowing subscribers to see a movie title more than once while using the service. The company said it believed these actions led to a reduction in its cash deficit during the first week of May by "more than 35%."
Many investors had been wary of the company after, in April, its independent auditor raised “substantial doubt” about its ability to stay in business, and the company sold more shares to help offset its losses.
"MoviePass currently spends more to retain a subscriber than the revenue derived from that subscriber," Helios and Matheson wrote in its annual report in April. Controlling costs should help that, but will it be enough to sustain the business in the long run?
The update on its cash and deposits, and losses, doesn't seem to have encouraged investors, and the stock plunged over 30% during trading Tuesday. AMC Theater's recent call with analysts likely didn't help either.
On late Monday night, as pointed out by The New York Post, AMC chief executive Adam Aron told analysts on a conference call that MoviePass, in April, paid an average of $12.02 per ticket to the movie chain. He also revealed that MoviePass users went to the movies an average of 2.75 times.
“Now, I took the calculator out and I multiplied 2.75 times $12.02 and I got to a number that was considerably larger than $9.95,” Aron said on the call, referring to MoviePass’ monthly subscription cost.
Have a tip about MoviePass or anything else? Email jguerrasio@businessinsider.com.
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