IMAX Q2 Earnings Surpass Expectations, Revenues Increase Y/Y

IMAX Corporation IMAX reported second-quarter 2025 adjusted earnings of 26 cents per share, which beat the Zacks Consensus Estimate by 36.84% and increased 44.4% year over year.Total revenues of $91.7 million beat the Zacks Consensus Estimate by 0.62% and increased 3.1% year over year. Category-wise, Image Enhancement & Maintenance Services and Technology Sales decreased 2.6% and 7.7% year over year to $50.8 million and $18.8 million, respectively. Technology Rentals and Finance Income increased 36.1% and 24.4% to $19.1 million and $2.8 million, respectively.Segment-wise, Content Solutions revenues decreased 0.7% year over year to $33.9 million in the second quarter of 2025. Technology Products and Services revenues rose 9.3% year over year to $55.6 million. All Other revenues declined 30.4% year over year to $2.08 million.IMAX Corporation Price, Consensus and EPS Surprise IMAX Corporation price-consensus-eps-surprise-chart | IMAX Corporation QuoteContent Solutions Business Details of IMAXWithin Content Solutions Business, Film Remastering and Distribution revenues increased 48.6% year over year to $31.5 million. Other content solutions revenues declined 83.2% year over year to $2.3 million.The second-quarter box office (including booking fees in China) of $281 million increased 40.5% year over year. A record number of films filmed for IMAX releases, such as Sinners, Mission: Impossible - The Final Reckoning and F1 The Movie, drove box office growth.Technology Products and Services DetailsWithin the Technology Products and Services segment, System Sales were $18 million, down 7.4% year over year. System Rental revenues increased 34.4% year over year to $18.7 million.Maintenance revenues were $16.06 million, up 5.4% year over year. Finance Income revenues were $2.87 million in the reported quarter, up 24.4% year over year.Network Growth Statistics of IMAXDuring the second quarter of 2025, IMAX installed 36 systems compared with 24 systems in the second quarter of 2024. As of March 31, 2025, there were 1,821 IMAX Systems operating in 89 countries and territories, including 1,750 commercial multiplexes, 11 commercial destinations and 60 institutional locations in the company’s global network. IMAX currently estimates a worldwide commercial multiplex addressable market of 3,619 locations, of which there are 1,750 IMAX Systems operating as of June 30, 2025, representing a market penetration of only 48%. Approximately 74% of IMAX System arrangements in backlog as of June 30, 2025, are scheduled to be installed in international markets compared to 82% in the year-ago quarter.Operating DetailsGross margin expanded 910 basis points (bps) to 58.5% in the second quarter of 2025. Content Solutions’ gross margin expanded 2000 bps to 66%, while Technology Products and Services’ gross margin expanded 360 bps to 54.2% in the second quarter. All other gross margins came in at 47.7%, down from 67.2% in the year-ago quarter.Adjusted EBITDA per credit facility was $36.7 million, up 36.6% year over year.Selling, general & administrative expenses decreased 6% year over year to $35.3 million. Research & development expenses were down 24.1% to $1.54 million.IMAX reported an operating income of $14.3 million, which surged 399.5% year over year.Net cash provided by operating activities for the first half of 2025 increased 25% year over year to $30 million, reflecting improvements in working capital driven by higher collections.Balance Sheet & Cash FlowNet cash provided by operating activities for the first half of 2025 increased 25% year over year to $30 million. As of June 30, 2025, IMAX’s available liquidity was $416 million. The company’s liquidity includes $109 million in cash and cash equivalents, $252 million in available borrowing capacity under the Credit Facility, and $4 million in available borrowing capacity under IMAX China’s revolving facilities. Total debt, excluding deferred financing costs, was $280 million as of June 30, 2025.In 2021, the company issued $230 million of 0.500% Convertible Senior Notes due 2026. Additionally, IMAX entered into privately negotiated capped call transactions with an initial cap price of $37.27 per share of the company’s common shares. The weighted average basic and diluted shares outstanding in the second quarter of 2025 were 53.8 million and 55.2 million compared with 52.6 million and 53.4 million in the second quarter of 2024, representing an increase of 2.3% and 3.4%, respectively. The company is authorized under its share-repurchase program, which was extended in June 2025, expiring June 30, 2027, to repurchase up to $500 million of its common shares, of which approximately $251 million remains available.GuidanceIMAX expects to deliver a record box office of more than $1.2 billion in 2025, along with a total adjusted EBITDA margin of over 40%, (low 40’s) and system installations of 150 to 160.Zacks Rank & Stocks to ConsiderIMAX currently carries a Zacks Rank #4 (Sell).Some better-ranked stocks in the broader Zacks Consumer Discretionary sector are Accel Entertainment ACEL, Central Garden & Pet CENT and Light & Wonder LNW, each carrying a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.Shares of Accel Entertainment have gained 16.3% year to date. Accel Entertainment is set to report second-quarter 2025 results on Aug. 5.Shares of Central Garden & Pet have risen 3.7% year to date. Central Garden & Pet is slated to report third-quarter fiscal 2025 results on Aug. 6.Shares of Light & Wonder have gained 12.9% year to date. Light & Wonder is set to report second-quarter 2025 results on Aug. 6.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Central Garden & Pet Company (CENT): Free Stock Analysis Report IMAX Corporation (IMAX): Free Stock Analysis Report Accel Entertainment, Inc. (ACEL): Free Stock Analysis Report Light & Wonder, Inc. (LNW): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks