Regal Cinema owner Cineworld Group reportedly files for bankruptcy

Yahoo Finance Live checks up on Cineworld's plunging stock as the owner Regal Cinema reportedly files for bankruptcy.

Video transcript

SEANA SMITH: My play today is Cineworld. Now, shares are selling off-- you can see it on your screen-- off just about 60%. This is the parent company of Regal Cinemas and the second largest movie chain operator. Now, "The Wall Street Journal" reporting it's preparing to file for bankruptcy. The company is expected to file a Chapter 11 petition in the US and is considering filing an insolvency proceeding in the UK. Now, the news coming after Cineworld warned earlier this week that a lack of blockbuster movies will be a problem for the company, potentially affecting its liquidity. Now, their debt levels, more than $4.8 billion.

It's interesting, though, AMC finding the positive spin here. Their CEO tweeted out right after the news yesterday that they're not too worried about softness in the movie sector because he thinks that the company is well-positioned here. But we are seeing certainly a shift. Cineworld being the latest victim here, Dave. And you see the reaction in the stock today on the news of the bankruptcy. No surprise that shares are off nearly 60%.

DAVE BRIGGS: Yeah, you got to hand it to Adam Aron, always putting the spin on things. This is 9,000 theaters in 10 countries. And, look, they're getting a really clear read of the return to movie theaters. And they're just saying, look, there's a couple of big blockbusters like "Top Gun." But beyond that, it's just not a sustainable business for them. I happen to be the same-- you know, very bearish on the movie theater. And I just don't think the young kids are going to return in this post-pandemic world. It's just kind of something you do every couple of months.

Now, give AMC credit. They are innovating. I think what theaters really need to do is figure a new way to drive customers into theaters. Playing old movies, one we'll talk about later on in the show. You got to find a way to innovate and get people to theaters when there's not a big blockbuster there.

- Yeah, and, I mean, I think it's good for AMC anyway because I think someone's always going to be going to the movies. Dave, I know you said the younger generation maybe isn't going. But there's room for that blockbuster, and someone has to show it to us, right? We're still-- we were talking about this earlier in a streaming conversation. You want to watch on the big screen when it's a big movie, and I think that there's still room to succeed in that space. Of course, movies aren't-- movie theaters aren't going to fully go away, right?

SEANA SMITH: How often do you guys go to the movie theaters these days?

- I haven't been since "Batman," which was February maybe?

SEANA SMITH: OK. What about you, Dave?

DAVE BRIGGS: I saw "Top Gun," and that's it. So I'm very like-- very much like Josh, one or two movies a year.

SEANA SMITH: I think mine was probably three years ago. So I'm not a good person to ask. We'll just leave it there.