IMAX Corp (NYSE: IMAX) unveiled its fourth-quarter 2023 earnings, surpassing expectations with robust revenue and profit growth. The company's forward-looking guidance anticipates maintaining a gross box office comparable to 2023's success.
For the year, IMAX saw a 25% revenue increase to $374.8 million, attributed to heightened system sales activity and the completion of 128 system installations, up from 92 the previous year. This surge led to a significant net income boost to $25 million for 2023, reversing a $(23) million loss from 2022. Additionally, adjusted EBITDA climbed by 52% to $128 million, demonstrating strong financial health.
Despite a slight dip in fourth-quarter revenue and gross margin compared to the prior year, the annual performance highlights the company's solid market position. The gross margin for 2023 improved to 57%, up from 52% in 2022, indicating enhanced profitability.
IMAX's strategic content diversification, including Hollywood releases and local language content expansion, alongside ventures into new areas like music and gaming, has fortified its global appeal. Rich Gelfond, IMAX's CEO, credited the company's global technology platform for delivering unparalleled cinematic experiences, driving consumer preference for the IMAX format.
Gelfond also noted strategic growth in key markets such as Japan, South Korea, and Europe, contributing to a record number of system installations. With the current network at just 47% penetration, IMAX identifies potential for nearly 2,000 more locations globally.
2023 was a landmark year for IMAX, marked by significant gains in net income, adjusted EBITDA, and system installations, driven by our cutting-edge technology and the consumer's growing preference for immersive IMAX experiences, Gelfond stated.
Looking ahead to 2024, IMAX aims for a gross box office on par with 2023 and projects system installations in the range of 120 to 150. The company forecasts a total consolidated adjusted EBITDA margin in the high 30s percentage.
IMAX shares surged better than 7% on the heels of its after hours release on Tuesday.