Mission: Impossible – MoviePass Profitability
MoviePass announced on Tuesday that it will raise its prices and exclude popular movie debuts from its offerings.
The movie subscription company has seen its stock plummet in recent months due to its high costs and lack of subscribers. Parent company Helios and Matheson had shares of $430 in May, and now, because of the plummet of their flagship subsidiary, their stock is now down to $0.25.
Last month, MoviePass debuted their $10 monthly price for one movie per day to attract more buyers. However, because of increased costs, this figure is now rising to $15 per month. Additionally, major movies like “Mission: Impossible — Fallout” will now be limited from their subscription – subscribers can pay an additional premium for these movies, but they will not be included in the monthly fee.
This comes at a time when MoviePass is officially out of cash. Last week, the company announced that they had no liquid money, which stifled their offerings. The company explains, “This is a strategic move by the company to both limit cash burn and stay loyal to its mission to empower the smaller artistic film communities. Major studios will continue to be able to partner with MoviePass to promote their first run films, seeding them with a valuable moviegoing audience.”
The adjustment frazzled many customers, causing them to publicly complain to the company or even cancel their subscriptions. Although this price increase might help MoviePass’s struggling profit margin, it will also likely deter many consumers from subscribing. Plus, among all of this, other competitors like AMC and Sinemia are entering and challenging the subscription service.
MoviePass will need to make even more changes if they want to stay listed on the Nasdaq.