- AMC has “substantial doubt” it can remain in business after shuttering all of its locations during the coronavirus pandemic.
- The company revealed that its revenue had fallen to $941.5 million in the first quarter, a nearly 22% drop from the $1.2 billion it garnered in the same quarter last year. The second quarter is expected to be even worse.
- AMC worries that distributors will continue to push back new film releases, hurting operations.
Quibi has asked senior executives to take a 10% salary cut as the short-form streaming video service explores ways to rein in costs after a disappointing debut, according to people familiar with the matter.
Quibi Chief Executive Meg Whitman is taking a 10% cut to her pay, the people said.
Quibi, which launched its streaming app on April 6, also has discussed laying off about 10% of its more than 250 employees, one of the people said. A top Quibi executive said there are currently no plans to follow through on substantial cuts.
The discussions centered on layoffs that would impact people mostly at the lower and middle rungs of the company, one of the people said. The company has already cut some low-level employees in recent weeks, some of the people said.
“Quibi is in a good financial position,” a spokeswoman said. “We are not laying off staff as a part of cost saving measures. We just added a dozen new employees.”
Shares of American Airlines Group Inc. AAL, +5.61% rallied 6.2% in afternoon trading, even as the air carrier’s credit rating was cut to a peer-group low of B- from B at S&P Global Ratings. The credit rating agency said the outlook on the rating, which is now six notches deep into speculative grade, or “junk” territory, remains negative. S&P said it’s also maintaining its assessment of liquidity at “less than adequate,” given the expectation of a “substantially negative level of cash generation” over the next 12 months. “We expect American to generate a substantial cash flow deficit in 2020 due to the impact of the coronavirus, but to return to positive cash flow generation in 2021,” S&P said. “While the company is reducing capacity and some associated costs, and benefits from the steep decline in oil prices, we expect these to continue to be more than offset by much weaker traffic.” Meanwhile, S&P rates the credit of United Airlines Holdings Inc. UAL, +12.50% at BB-, Delta Air Lines Inc. DAL, +7.76% at BB, Southwest Airlines Co. LUV, +5.56% at an investment grade level of BBB and JetBlue Airways Corp. JBLU, +9.31% at BB-. Another downgrade of American’s rating would put it in the CCC level, which S&P says reflects debt that is “currently vulnerable to nonpayment.”