AMC Entertainment Holdings posted a bigger-than-expected loss as costs jumped nearly 60% in the second quarter.
The company also announced that it would pay a special dividend in the form of preferred shares.
Shares of the once-popular meme stock are down 7% in premarket trading as the move raised concerns about possible stock dilution.
AMC’s preferred stock could be converted into common stock if investors approve the move.
AMC CEO: Moviegoers spend despite inflation
The company will allot one preferred stock for each AMC common stock held.
AMC plans to list approximately 517 million preferred shares on the New York Stock Exchange under the symbol “APE”.
“This new AMC preferred stock gives AMC currency that can be used in the future to strengthen our balance sheet, including paying down debt or raising new capital,” Chief Executive Adam Aron said.
AMC REVENUES QUINTUPLE AS THEATERS RETURN TO THEATERS
Quarterly revenue hit $1.17 billion, beating the estimate of $1.16 billion, while the net loss of 24 cents per share was above market expectations of 21 cents, according to Refinitiv data.
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AMC’s market value soared last year in a rally driven by retail investors, helping it raise billions of dollars in equity, even at the cost of investor concern over a erosion of the value of its shares.
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At the height of the coronavirus pandemic, AMC suffered heavy losses as restrictions forced theaters to close again.
Reuters contributed to this report.