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IMAX Inks Exclusive Movie Release Deal With Amazon Studios

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IMAX (IMAX - Free Report) recently announced an exclusive deal with Amazon (AMZN - Free Report) Studios related to the latter’s upcoming film The Aeronauts.

Per the deal, the film directed by Tom Harper, will be first available in IMAX theaters for a week all over the country, starting Oct 25, 2019. Notably, this is a first-of-a-kind deal involving IMAX and Amazon and the film is the first movie from the Amazon Studios to find its way to IMAX theaters.

Amazon’s decision to partner with IMAX is likely due to the unique theatrical experience the company can provide using its differentiated technology. Moreover, IMAX stated that the film’s director “designed the movie for IMAX screen.”

Following the one week run on IMAX theaters, the film will be released on other theaters nationwide from Nov 1, 2019.

IMAX Corporation Revenue (TTM)

IMAX Corporation Revenue (TTM)

 

IMAX Corporation revenue-ttm | IMAX Corporation Quote

IMAX Technology: A Key Differentiator

IMAX is expected to witness increase in footfall following the release of The Aeronauts as key action sequences in the film were exclusively made for IMAX theaters. This means that users can see “up to 26% more picture than standard theaters.”

Additionally, the company will use its DMR (Digital Re-mastering) technology to make The Aeronauts more suitable for the IMAX experience. Increasing use of DMR technology is likely to boost IMAX DMR revenues and gross box office from IMAX DMR films.

Notably, IMAX DMR revenues were up 3.3% from the prior-year quarter to $27.9 million in first-quarter 2019. Additionally, gross box office from IMAX DMR films increased 3.8% year over year to $256.3 million in the same period.

Moreover, the company’s strategy to increasingly sell its DNA technology, which is generally used in IMAX cameras in the film-making process, may help it attract movie viewers.

Increasing Presence, Key Releases to Aid the Top Line

IMAX’s top line is expected to benefit from its expanding presence along with key movie releases in 2019.

The company signed contracts for 14 new theaters and nine upgrades in first-quarter 2019 across regions – Europe, North America and Japan. Additionally, IMAX’s decision to increase its footprint in Japan, which is the third most contributing country to box office in the world, is likely to boost its box-office sales.

Moreover, the company’s renewed partnership with Cinemark Holdings (CNK - Free Report) to bring new IMAX laser theaters and upgrade the existing ones to IMAX laser is a positive.

Also, key releases including Disney’s (DIS - Free Report) Avengers: Endgame and Toy Story 4 and Godzilla: King of the Monsters are likely to boost IMAX’s box-office performance in 2019. Notably, Avengers: Endgame contributed to the biggest ever IMAX opening in China and broke IMAX box office records in markets like Germany and France.

IMAX currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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