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Imax (IMAX) Down 9.6% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Imax (IMAX - Free Report) . Shares have lost about 9.6% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Imax due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for IMAX Corporation before we dive into how investors and analysts have reacted as of late.
IMAX Corporation reported fourth-quarter 2025 adjusted earnings of 58 cents per share, beating the Zacks Consensus Estimate by 34.88% and increasing 115% year over year.
Total revenues of $125.2 million surpassed the Zacks Consensus Estimate of $120 million by 4.33% and rose 35% year over year.
Category-wise, Technology Sales increased 40.7% year over year to $46.6 million. Image Enhancement and Maintenance Services revenues increased 29.3% year over year to $55.3 million, while Technology Rentals grew 48.3% year over year to $20.5 million. Finance Income declined 4.2% year over year to $2.8 million.
Segment-wise, Content Solutions revenues increased 50% year over year to $38.2 million.
Technology Products and Services revenues rose 32% year over year to $84.6 million. All Other revenues declined 23.9% year over year to $2.4 million.
Content Solutions Business Details of IMAX
The segment achieved a gross margin of 57%, increasing 1,100 basis points from 46% in the fourth quarter of 2024. Fourth-quarter 2025 IMAX gross box office, representing total ticket sales collected across the IMAX network, increased 62% year over year to $336.2 million, setting a new fourth-quarter record. Avatar: Fire and Ash was the standout title of the quarter, generating $112 million in IMAX gross box office ticket collections for the calendar year to become IMAX's top-grossing Hollywood title in 2025.
Technology Products and Services Details of IMAX
The segment’s gross margin grew 44% year over year to $49.1 million, with the gross margin percentage expanding to 58% from 53% in the fourth quarter of 2024, primarily reflecting the positive incremental flow through of higher box office tied to rental revenues.
Network Growth Statistics of IMAX
During the fourth quarter of 2025, IMAX installed 65 systems compared with 58 systems in the fourth quarter of 2024. As of Dec. 31, 2025, 1,864 IMAX Systems were operating in 91 countries and territories, including 1,796 commercial multiplexes, 10 commercial destinations and 58 institutional locations.
System signings in the fourth quarter totaled 24 systems, including 23 sales arrangements and one traditional joint revenue-sharing arrangement. Total system backlog, as of Dec. 31, 2025, stood at 434 systems, comprising 139 sales arrangements, 92 hybrid joint revenue sharing arrangements and 203 traditional joint revenue sharing arrangements.
Operating Details of IMAX
Gross margin expanded 540 basis points to 57.6% in the fourth quarter of 2025.
Total Adjusted EBITDA was $57.1 million, up 53% year over year, with a margin of 45.6%, expanding 550 basis points.
Selling, general and administrative expenses increased to $35.5 million from $32.4 million in the prior year period. A goodwill impairment charge of $7 million and an induced conversion expense of $15.3 million on the settlement of convertible notes were notable one-time items in the quarter.
IMAX reported operating income of $24.1 million in the quarter, surging 153% year over year, driven by strong box office performance and margin expansion.
Balance Sheet & Cash Flow details for IMAX
As of Dec. 31, 2025, IMAX's available liquidity was $545 million, marginally higher compared to $544 million as of Sept. 30, 2025. Cash and cash equivalents increased to $151 million from $143 million in the prior quarter.
Available borrowing capacity under the Credit Facility decreased to $338 million from $346 million, while IMAX China's revolving facility capacity increased marginally to $56 million from $55 million.
Total debt, excluding deferred financing costs, was $289 million as of Dec. 31, 2025 compared to $261 million as of Sept. 30, 2025.
In 2025, the company issued $250 million of 0.750% Convertible Senior Notes due 2030 and entered into capped call transactions with an initial cap price of $57.10 per share.
The weighted average basic and diluted shares outstanding in the fourth quarter of 2025 were 53.9 million and 56.3 million compared with 53.8 million and 55.6 million in the third quarter of 2025, representing increases of 0.2% and 1.3%, respectively.
The company's share repurchase program, extended in June 2025 and expiring June 30, 2027, has approximately $250.7 million remaining available under the $500 million authorization.
Guidance
For 2026, IMAX expects global box office of approximately $1.4 billion, total adjusted EBITDA margin in the mid-40s with a floor of 45% and system installations of 160 to 175, with an approximate 45%/55% Sale/JRSA mix and an approximate 60%/40% new/upgrade mix.
The 2026 slate includes Christopher Nolan's The Odyssey, Dune: Part Three, The Mandalorian and Grogu and Greta Gerwig's Narnia.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -24.09% due to these changes.
VGM Scores
Currently, Imax has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Imax has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Imax (IMAX) Down 9.6% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Imax (IMAX - Free Report) . Shares have lost about 9.6% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Imax due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for IMAX Corporation before we dive into how investors and analysts have reacted as of late.
IMAX Q4 Earnings Surpass Expectations, Revenues Increase Y/Y
IMAX Corporation reported fourth-quarter 2025 adjusted earnings of 58 cents per share, beating the Zacks Consensus Estimate by 34.88% and increasing 115% year over year.
Total revenues of $125.2 million surpassed the Zacks Consensus Estimate of $120 million by 4.33% and rose 35% year over year.
Category-wise, Technology Sales increased 40.7% year over year to $46.6 million. Image Enhancement and Maintenance Services revenues increased 29.3% year over year to $55.3 million, while Technology Rentals grew 48.3% year over year to $20.5 million. Finance Income declined 4.2% year over year to $2.8 million.
Segment-wise, Content Solutions revenues increased 50% year over year to $38.2 million.
Technology Products and Services revenues rose 32% year over year to $84.6 million. All Other revenues declined 23.9% year over year to $2.4 million.
Content Solutions Business Details of IMAX
The segment achieved a gross margin of 57%, increasing 1,100 basis points from 46% in the fourth quarter of 2024. Fourth-quarter 2025 IMAX gross box office, representing total ticket sales collected across the IMAX network, increased 62% year over year to $336.2 million, setting a new fourth-quarter record. Avatar: Fire and Ash was the standout title of the quarter, generating $112 million in IMAX gross box office ticket collections for the calendar year to become IMAX's top-grossing Hollywood title in 2025.
Technology Products and Services Details of IMAX
The segment’s gross margin grew 44% year over year to $49.1 million, with the gross margin percentage expanding to 58% from 53% in the fourth quarter of 2024, primarily reflecting the positive incremental flow through of higher box office tied to rental revenues.
Network Growth Statistics of IMAX
During the fourth quarter of 2025, IMAX installed 65 systems compared with 58 systems in the fourth quarter of 2024. As of Dec. 31, 2025, 1,864 IMAX Systems were operating in 91 countries and territories, including 1,796 commercial multiplexes, 10 commercial destinations and 58 institutional locations.
System signings in the fourth quarter totaled 24 systems, including 23 sales arrangements and one traditional joint revenue-sharing arrangement. Total system backlog, as of Dec. 31, 2025, stood at 434 systems, comprising 139 sales arrangements, 92 hybrid joint revenue sharing arrangements and 203 traditional joint revenue sharing arrangements.
Operating Details of IMAX
Gross margin expanded 540 basis points to 57.6% in the fourth quarter of 2025.
Total Adjusted EBITDA was $57.1 million, up 53% year over year, with a margin of 45.6%, expanding 550 basis points.
Selling, general and administrative expenses increased to $35.5 million from $32.4 million in the prior year period. A goodwill impairment charge of $7 million and an induced conversion expense of $15.3 million on the settlement of convertible notes were notable one-time items in the quarter.
IMAX reported operating income of $24.1 million in the quarter, surging 153% year over year, driven by strong box office performance and margin expansion.
Balance Sheet & Cash Flow details for IMAX
As of Dec. 31, 2025, IMAX's available liquidity was $545 million, marginally higher compared to $544 million as of Sept. 30, 2025. Cash and cash equivalents increased to $151 million from $143 million in the prior quarter.
Available borrowing capacity under the Credit Facility decreased to $338 million from $346 million, while IMAX China's revolving facility capacity increased marginally to $56 million from $55 million.
Total debt, excluding deferred financing costs, was $289 million as of Dec. 31, 2025 compared to $261 million as of Sept. 30, 2025.
In 2025, the company issued $250 million of 0.750% Convertible Senior Notes due 2030 and entered into capped call transactions with an initial cap price of $57.10 per share.
The weighted average basic and diluted shares outstanding in the fourth quarter of 2025 were 53.9 million and 56.3 million compared with 53.8 million and 55.6 million in the third quarter of 2025, representing increases of 0.2% and 1.3%, respectively.
The company's share repurchase program, extended in June 2025 and expiring June 30, 2027, has approximately $250.7 million remaining available under the $500 million authorization.
Guidance
For 2026, IMAX expects global box office of approximately $1.4 billion, total adjusted EBITDA margin in the mid-40s with a floor of 45% and system installations of 160 to 175, with an approximate 45%/55% Sale/JRSA mix and an approximate 60%/40% new/upgrade mix.
The 2026 slate includes Christopher Nolan's The Odyssey, Dune: Part Three, The Mandalorian and Grogu and Greta Gerwig's Narnia.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -24.09% due to these changes.
VGM Scores
Currently, Imax has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Imax has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.