Good morning, everyone, and thank you for joining us today to discuss our fourth quarter and full year 2025 results. Our earnings release, executive commentary, as well as our Form 10-K were issued earlier this morning and are available on our website at ir.cinemark.com.

Today's call is being webcast with a replay and transcript available on the website after the call. Before I begin, I would like to remind everyone that during this conference call, we will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements may include, but are not necessarily limited to, financial projections or other statements of the company's plans, objectives, expectations, or intentions. Forward-looking statements are subject to risks and uncertainties that could cause the company's actual results to materially differ from those expressed or implied.

The factors that could cause results to differ materially are detailed in our most recent annual report on Form 10-K as filed with the SEC and available on our website. Also, today's call will include non-GAAP financial measures.

A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the website's most recently filed earnings release, 10-K, and on the company's website at ir.cinemark.com. Joining me this morning are Sean Gamble, President and CEO, and Melissa Thomas, CFO.

Beginning with today's call, we are shifting our earnings format to provide adequate time for your questions. Following brief introductory remarks from Sean, we will open up the lines for Q&A.

With that, I'll turn the call over to Sean.

Thank you, Chanda, and good morning, everyone. Before we dive into Q&A, I'd like to briefly reflect on our 2025 results, as well as the advancements we've made over the past few years.

Driven by further market share expansion and a series of all-time record achievements in 2025, we delivered a post-pandemic high in worldwide revenue of $3.1 billion. This strong top-line result, combined with effective cost management and incremental productivity gains, resulted in $578 million of adjusted EBITDA, with a healthy 18.6% adjusted EBITDA margin.

Through a relentless focus on initiatives that are aimed at expanding our audiences, activating new sources of revenue growth, optimizing our circuit, and continuously improving our processes and capabilities, we have taken the experiences we create for our guests and our operating agility to new levels. Furthermore, we have developed a distinctive set of competitive advantages, including a differentiated position of strength.

Over the past three years, we generated nearly $1.8 billion of adjusted EBITDA, with over $1.3 billion of operating cash flow. We increased customer loyalty to Cinemark, meaningfully expanded our market share, and grew our concession revenues and per caps to all-time highs.

We refortified our balance sheet, extinguishing over $700 million of COVID-related debt, while at the same time reinvesting over half a billion dollars in capital expenditures to advance our company for the future, and returning $315 million to shareholders through dividends and share buybacks. Achieving these results has required extraordinary dedication, ingenuity, and perseverance throughout our entire company, and I'd like to commend our sensational global team for the significant impact they have made, setting up Cinemark for ongoing success in the current environment and beyond.

As we look ahead, we remain focused on effectively navigating an evolving media and entertainment landscape, continuing to diligently operate our business and delight our guests week after week, and effectuating a multitude of strategic initiatives to further strengthen our company and market position. 2026 appears set to benefit from a robust lineup of compelling films, and a volume of wide releases that looks poised to reach pre-pandemic levels.

We are excited about the prospects of this year's slate, and we remain highly encouraged by sustained consumer enthusiasm we continue to see for the types of larger-than-life cinematic entertainment we provide at Cinemark, as well as the multitude of opportunities before us that are fully within our control to create incremental value for our customers, partners, and shareholders. Operator, we'd now like to open up the line for questions.

Yes. Good morning.

Thank you for the question. Sean, given how well premium has been performing for you guys, I'm curious, how many of your theaters have two XD screens?

Are there plans to add more theaters with multiple XD screens? What do you think ultimately that could be?

Sure. Thanks for the question, Eric.

Definitely, premium amenities, we're seeing a growing interest from a section of our audiences who really enjoy the added enhancement that they provide. Specific to your question, we've got about 10% of our domestic circuit that has two XDs.

There are others that have combination of an IMAX and XD, a ScreenX and an XD, but that's where the overlap. Part of the governor on that is just having enough significant screens to add an extra XD to.

We are very particular about making sure that if we're selling an enhanced experience, that it fully delivers on that. That's beyond just the sound, the environment, it goes to the scale of the screen.

If it's an existing theater, there needs to be a second auditorium that can do that. We are in the process of rolling out additional screens over the next few years, we're going to be continuing to do that.

We've got still a nice runway of opportunity, but I'm just flagging that there are some limits. We also are just focused on how many of those we have in a theater.

Premium enhanced format still only represent about 15% of overall box office. While there is a group of moviegoers who do like to pay that additional enhanced experience, the bulk of moviegoing still is on all the other screens.

Our focus is continue to make sure all of our screens are a premium experience, regardless of whether you choose XD or something else.

That's helpful. Then, I wonder if you have any type of updates on new-build activity, be it in the US or Latin America.

Sure. Our new-build pipeline was slowed during the pandemic, obviously.

Then we've reactivated our real estate efforts in exploring opportunities out there. We've got a number of things that are in motion, but these projects can take two to three years to get off the ground.

We opened a new site in El Paso in 2025. We've got plans to open an additional site in Greenville, Texas in 2026.

We've broken ground in Omaha, Nebraska on another site for 2027. Then we've got a range of other projects, as I mentioned, that are in motion.

We've reactivated that. It just takes a little bit of time to fully get up to speed because you've got to make sure you get the right site.

When you go through all the exercise of finding the locations, negotiating the deals, working through all the regulatory processes, it can just take a little bit.

Eric, you see that increase in our pipeline coming through as well in the step-up in capital expenditures that we're expecting from '25 to 2026. That is reflected there, as well as to your point on XDs and how many opportunities there, expansion in XD, ScreenX, and D-BOX as well.

Thank you very much.

Thanks, Eric.

Hey, thanks. Sean, in your executive commentary, you noted the softer-than-anticipated slate last year.

Wanted to see just with some hindsight you could walk through the factors that you think drove this. Is this primarily about quality and film mix or are there any kind of structural impacts to consider like windows?

Thanks.

Sure. Thanks for the question, David.

At a high level, I would say we view it more as just the normal ebb and flow of the industry. I think perhaps some of the expectations for 2025 got a little bit overinflated coming in.

We had some pretty lofty targets for select films. When we look at the aggregate of the slate, there was a bit more of a mixed bag of the ones that overperformed and some of those that didn't fully resonate.

The year lacked a mega blockbuster that exceeded half a billion dollars, and there really was no major summer animated film. I think if we had had one $300 million animated film this summer, which we traditionally do, I think everybody would be viewing 2025 much differently.

I think I don't view that as a real structural issue. I think it's just more the way sometimes the strength and quality of films play out and how well they resonate with audiences.

Windows is something we do continue to evaluate. It's a big topic for the industry.

There are indications that awareness of highly shortened windows is having some effect on smaller movies and more casual moviegoers, which could be providing some headwinds to overall recovery in the industry, there is a factor. I don't look at kind of the softness versus expectations on '25 necessarily because of that, it's just more based on some of the really high expectations we had.

Okay. Then just with margins, when we look at '25, obviously, attendance was a headwind.

Assuming a recovery this year, how should investors think about room for operating leverage? Melissa, any help in thinking about kind of cost of goods, staffing, or G&A?

Thank you.

Sure. From a margin standpoint, we would expect, given we do expect a stronger box office and higher attendance year over year, that would support leverage in our operating model as well as margin expansion.

As our EBITDA margins are most heavily influenced by those two factors of box office and attendance. That said, there are a number of variables beyond that that influence our margin: with market share, average ticket prices, and food and beverage per caps, and then in addition to that, incremental value that we expect to capture from our strategic initiatives and our ability to manage cost pressures.

Then for international segments, our performance will depend on how film slate resonates with their audiences, as well as inflationary and FX dynamics. Then to your question on expenses, particularly on a go-forward basis, from a G&A perspective, we do expect our G&A to continue to reflect merit increases and rising benefit costs.

We are making targeted strategic investments in talent and capabilities, including cloud-based software, to continue to advance our strategic priorities and position the company for long-term success. We remain disciplined in our approach to expense management, ensuring that our spend is closely aligned with long-term objectives.

Then broadly, as you think about our variable costs, those are going to flex with attendance, albeit not at the same rate.

Okay.

Thanks, David.

Thanks. Good morning.

I guess question on kind of moviegoer monetization. Can you talk about with the strength you had in concessions, Q4 and then broadly throughout last year, what strategies have been driving the most success that you've kind of put into place with the various ones that you've used?

Anyway to parse out how much of the increase was film mix influence versus just basket and incidence? Then lastly, kind of what do you think the opportunity is going to push ticket prices and concessions higher this year given the environment that we're in economically?

Thanks.

I'll take that one. From a per-cap standpoint, our per caps domestically were up about 5% year over year.

There were three primary drivers to that: first, our strategic pricing actions; second, higher incidence rates; and then third, a shift in product mix given the growth in merchandise sales as well as enhanced foods. As you think about kind of the breakout of that, I'd call it probably around three points strategic pricing, a point incidence, and a point driven by shift in product mix.

In terms of the key catalysts, as we've said before, food and beverage, this is a game of singles and doubles. We have a variety of initiatives that we've been executing upon and others that we will be executing on to really drive growth on an ongoing basis.

That includes increasing the throughput of our concession stands, leveraging planograms to improve the monetization of our space. We continue to introduce new concepts, new flavors, expanding our enhanced food offerings, we still think there's runway there, as well as growth in movie-themed merchandise, and that's just to name a few.

As we think about the go-forward looking ahead to 2026, we do remain optimistic about our ability to deliver another year of moderate year-over-year growth in concession per cap supported by the broad range of initiatives that I just mentioned. We do think that growth can come from both incidence as well as further opportunities to optimize our pricing.

Bear in mind, from quarter to quarter, our per caps will fluctuate with film mix. Then in our international markets, we do expect concession per cap to be impacted by inflationary as well as FX dynamics in the region, while shifts in country mix also can play a factor.

Overarchingly, our focus is on delivering sustainable per-cap growth and ensuring that our strategies are supporting both profitability and long-term value creation.

Perfect. Thanks, Melissa.

Thank you. Thanks, Eric.

Hi, good morning, Sean, Melissa. Thanks for taking my question.

Wanted to ask about international attendance. It fell in '25, and I believe a lot of that decline was really just kind of a product of what was out there in terms of the movie slate.

As you look at '26, Sean, I know you talked about your optimism maybe domestically or globally, but what about internationally? Do you think this could be an inflection point and maybe we could see attendance even exceed what we're expecting in the US in '26?

Thanks.

Sure. Thanks for the question, Chad.

I think you're right. When we look at overall 2025 for Latin America in particular, the profile of the slate in terms of what worked and kind of what didn't work, it skewed a little bit lower for that region relative to the US.

That's just nothing more than the product, and we see how that kind of can fluctuate year to year. 2026, specific to that region, we are optimistic about a better balance relative to the US.

We think that the overall slate looks set to resonate stronger with Latin audiences than 2025 did. You've got titles like Michael, The Super Mario Galaxy, Spider-Man: Brand New Day, Minions, Avengers: Doomsday.

These are all movies that really will resonate. There's another Insidious title, and that particular type of genre of horror and that franchise in particular has done really well there.

Certain films like The Odyssey, Star Wars, Supergirl, Cat in the Hat, some of those, sci-fi-oriented, Dune, those do tend to skew down. On the whole, we definitely are more optimistic about 2026 in LatAm.

In general, attendance throughout that region has recovered in certain pockets, more so than in the US. With everything, a great example we always like to point to is Argentina, with all the hyperinflation and the economic and political turmoil that has happened within that country over recent years, attendance is neck and neck with pre-pandemic levels.

They've recovered exceptionally well. When the content is there and it connects, that region in particular can really show some upside.

Great. Thank you.

Then as we think more broadly, just in terms of the loyalty product, I think you said 60% domestically, 30% internationally. Are there any changes that we should expect in the near term that could either help that loyalty, increase moviegoing, yeah, just anything on the product side that could be different in the near term for consumers?

Thank you.

I would say I don't know if there's anything materially different. I think that the core value and the core benefits that are inherent to these programs continue to resonate with existing members and continue to attract growth in our overall membership.

We've continued to see growth year after year in these programs. Movie Club in particular in the US is up over 50% from where we were in 2019.

We do expect that that will start to level off a bit more as the program continues to mature, but thus far, we've continued to see terrific growth. What we're doing is, in addition to those kind of core benefits, we do keep adding additional elements to it just to keep it fresh and enrich it.

There's all kinds of surprise and delight type of events we do for our loyalty members throughout the year where they get invited to special programming and things of that sort. I mentioned that we just added a new premium tier to Movie Club, which we're hopeful will attract those audiences who are more inclined to upgrade on a regular basis.

We've introduced badges. There's a whole slew of things like that that we continue to add to the program to make it attractive from a retention standpoint, as well as attracting new guests.

I think that's really it. We do other kind of promotional events, sometimes tied to films, sometimes tied to just engaging types of incentives also to stimulate growth.

Those are the things that we're continuing to lean into to sustain growth and sustain our existing membership.

Okay. Thank you very much.

Thanks, Chad.

Thanks. Hi guys, good morning.

Consolidated ATP growth has accelerated over the last few years. How do you foresee the rate of change for ATP trending going forward?

Given the ongoing shift towards and success with PLFs across your circuit, amongst other factors, is the mid-single digit increase the business delivered in 2025 a new normal or was last year more of a one-off and not sustainable?

Thanks for the question, Drew. To your point, we were pleased we've delivered a 4% CAGR in our domestic average ticket price over the past three years.

As we look ahead to 2026, we expect average ticket prices will increase modestly year-over-year in the full year. That's really twofold: one, we do believe that there's further strategic pricing opportunities, as well as opportunities related to our continued expansion of premium offerings.

As we mentioned, XD, D-BOX, IMAX, and ScreenX. We do think it's twofold, but not likely to the same extent that we saw in 2025 given some of the outsized mix benefits.

Keep in mind, average ticket prices, they will fluctuate quarter to quarter depending upon the film mix. Then on the international side, inflationary and FX dynamics in the region could play a factor, as well as country mix.

We do continue to approach our pricing decisions thoughtfully and are leveraging data to identify those optimal price points that maximize attendance as well as box office performance.

Got it. Thanks.

Then maybe one follow-up, can you address the planned splits between US and international in terms of CapEx spend? Is the $250 million number you're planning for this year a good annual run rate for the business, or is '26 a peak?

Thanks.

Yeah. In terms of splits between international and the US, typically around $50 to $60 million of our CapEx is dedicated on the international side, remainder is towards the US.

Then in terms of our capital expenditures in 2026, those are ramping up to $250 million, and that's based on not only our expectations for cash flow generation, but also the ROI-generating opportunities in front of us that we're looking to pursue. As we look forward beyond 2026, the extent of our spending, and whether we kind of stay at that $250 million level, will again be predicated on the ROI-generating opportunities we see in front of us.

Then the other point I would call out is as the new-build pipeline ramps, that can cause variability from year to year with temporary upticks and then coming back down, just depending upon where we're at within that new-build pipeline timeline. There could be some fluctuations, but by and large, I would say we're too early to tell at this stage.

Thank you.

Mhm.

Thanks, Drew.

Hi, good morning. Just had a quick follow-up on some of your CapEx comments.

Just on the new builds, are these kind of expanding into additional markets or are they kind of more replacing older theaters within those markets? I guess similarly, is that sort of the path that you're taking to increase the recliner penetration, or are you still finding opportunities within existing theaters to kind of renovate those and increase the, I guess, competitiveness and attractiveness of those amenities?

In terms of the new-build pipeline, most of the locations that we are looking at are new locations. That would be in new markets where we see that there's underpenetration and there's opportunity for us to go in and have a high-confidence return.

That is really the genesis of what we're doing on the new-build side.

I'll add on the recliners, we do still see recliner opportunities. With 72% of our circuit reclined in the US, those are fewer than they once were, but we are still finding opportunities beyond our new builds to have attractive returns with some of our theaters that strengthen the overall competitiveness as well as just provide a good lift in performance.

Okay. Then on just the film slate for 2026 and maybe even 2027 as well, I guess, how are you seeing the cadence of releases?

Are you seeing it kind of create more stability in box office in the coming years? I guess, yeah, just how are you viewing that?

It's a great question. The good news is volume continues to grow.

We saw that 2025 got to within 5% or so of pre-pandemic levels. 2026 looks to at least match that, potentially go beyond that.

The benefit of that is, obviously, our industry tends to be a bit of a momentum type of business where people come to the theater, they see what's coming up, they get excited, they have a good experience, and they come back because of that. When you get these kind of lulls in terms of things being released, you're winding up having to reboot the engine over and over and over again.

That's the type of cycle that we've been in. I think the good news is with further recovery and volume coming forward, there should be fewer of those instances of having to reboot.

I will say what we've still yet to see, and these are conversations we continue to have with our studio partners, is, for a long while prior to the pandemic, we would see more of the films getting bunched in the summer and at year-end, and then in time, everybody learned it's a 12-month calendar. Movies can do huge business anytime of the year: first quarter, late summer, not just kind of in those peak when kids are off from school types of months.

I'd say the industry's gravitated a little bit back to this old norm, and we see a bit of a more crowded summer in 2026 and a crowded year-end. That's one of the things that we're still looking for that to fully resolve itself so we can truly have a fluid cadence of movies every month throughout the year and just sustain that momentum.

That's something that still is being sorted out, but the good news is it's moving in the right direction.

Thank you.

Thanks, Patrick.

Good morning. Two for you.

When you look at 2026 and beyond, how do you balance leaning into your organic growth led by the sustainability of market share gains compared to positioning the company for other opportunities like M&A that hasn't really been an option for a while? Then just if we could get any update on where things stand with any conversations you've had on the Warner Bros.

acquisition, both with either Netflix or Paramount Skydance? Thank you so much.

Thanks, Robert. I'll take the first part of your question.

In terms of our strategy for investing in growth, we have a balanced and disciplined approach to capital allocation, and we intend to invest in growth opportunities, including new builds, existing theater enhancements, and M&A to the extent attractive opportunities present themselves. As you think about M&A, we evaluate all transactions that come to market, and we target high-quality assets with minimal deferred maintenance needs.

Consistent with our disciplined approach, we're looking for accretive M&A opportunities at attractive multiples. Preferred to deepen our penetration in markets where we already have a presence to leverage established infrastructure, relationships, and market knowledge to drive growth and create value.

Naturally, there's other factors we also look at, scale, strategic importance, competitive positioning, and margin profile. Then in terms of new builds and theater enhancements, we again remain disciplined with our capital expenditures.

We're looking for ROI-generating opportunities that are high-confidence and that position the company well for the long term and enhance the guest experience. Overarchingly, we're looking to balance among the three.

That is something that we're evaluating on an ongoing basis to try to create value for all shareholders.

On that last point, before Warner Bros., I would just add, too, they're not mutually exclusive, right? The good news is with the strength that we've recovered our balance sheet, we have the opportunity to pursue multiple attractive, accretive types of deals, whether they be new builds or M&A, to the extent they're there.

As Melissa said, we're going to continue to be disciplined in that approach. Specific to the Warner Bros.

deal, I don't know if there's a tremendous amount to update on that. Clearly, the overall transaction remains pretty active and fluid in terms of what direction this may go going forward.

Our focus, along with our trade organization Cinema United, has just been to engage directly with all the respective parties as well as the regulators to ultimately pursue an outcome that is in what we believe is in the best interest of our industry, of the creative community, of consumers, and of the local economies that benefit from healthy theaters in their towns. That's focus on sustained volume of output with whichever direction this transaction plays out, sustained exclusive theatrical windows, and in a meaningful way that support the industry, as well as sustained levels of comprehensive marketing campaigns to get that message out.

Those are the things that have driven value, have been moving in a positive direction with new entrants coming in and growth from different players in terms of volume. We just want to make sure that things continue to progress that way versus any type of risk that might ensue from a consolidation of a significant studio like Warner Bros.

that has been a strong partner of theatrical exhibition for many, many years, and just had a record-breaking performance in 2025.

Sounds good. Thank you, guys.

Thanks, Robert.

Good morning, and thanks for the question. Sean, market share has been a key driver of Cinemark's outperformance, and we were encouraged by the 4Q results despite the softer box office.

I understand that the box office continues to recover, there might be some capacity constraints. How have you guys been able to gain share, and how do you plan to manage your footprint with a busier slate in '26?

Sure. Thanks for the question, Omar.

It's been a variety of things we pursued. If we kind of unpack 2025, first, we were thrilled with our overall results of 2025.

We continue to see the benefits of the varied initiatives that we've been pursuing to build our audiences, everything from our showtime programming to our marketing actions to our pricing strategies to our loyalty programs, which we spoke about earlier. All of those things have helped support increasing our structural market share.

2025 in particular, while we had at the beginning of the year expected our market share might moderate a little bit, it actually continued to benefit from a high concentration of outperforming family and horror films, as well as what played out to be a more of a balanced cadence of releases throughout the years, which limited the amount of capacity constraints we hit, and enabled us to fully optimize our screens. We benefited from that throughout the year.

I'll flag that, obviously, our share year to year will fluctuate based on that content mix and how well individual films resonate with our audiences, as well as those capacity constraints. When we look at 2026 in particular, again, we see a highly compelling, diverse profile of films on paper.

As we look at the composition, there is a little bit more crowding that we do see during the summer and year-end, as I alluded to a moment ago. You've got some pretty substantial films in that pocket, which could lead to more capacity constraints where we're just fully utilized and don't have the benefit of kind of expanding further like we were able to do in '25, which could create a little bit of a headwind and cause our market share to normalize a bit.

Ultimately, it's just going to depend on how the actual results film by film play out, and the extent to which any of those dating decisions spread a bit more from the way they're organized right now.

Great. On alternative content, you guys have seen some notable success recently.

Just curious, how's Cinemark leaning into this category, and what untapped opportunities do you see within this vertical? Thanks.

Absolutely. Look, I think alternative content is definitely one of the real positive signs we're seeing with nice growth.

Similar to younger moviegoers, we're seeing nice growth in younger moviegoers. Specific to alternative content, we've had multiple consecutive years now where alternative programming has been more than 10% of our box office.

That's just not because of the overall box office. The pure proceeds from alternative content, as an example in 2025, are up more than double what they were in 2019.

Audiences continue to be attracted by this content. It's a range of different areas: everything from faith-based films, to anime, to other foreign films, content creator, concerts, there's a whole slew of things that are repertory films.

They just continue to grow in their scale and magnitude. Your specific question on what are we doing, we have a team that is dedicated to finding these kind of opportunities, pursuing them, and then trying to really understand what the potential is so we can optimize how we're programming that throughout our circuit.

It's been really successful, and we expect or at least we're optimistic about continued growth in this area as we move forward.

Great. Thank you, guys.

Thank you.

Hey, Sean, Melissa, Chanda, congrats, guys, on '25. I appreciate this new format as well, it's very helpful.

First question from us is just, Sean, the impact on AI. We've obviously seen AI sort of, pun intended, rewrite the script here of a lot of companies and being, I guess, destructive here.

It seems like out-of-home entertainment is in a really sweet spot in terms of not being negatively impacted. I guess the flip side, positive impact, although delicate, I'm sure, but on film development, it seems like there's a lot of opportunity to reduce expense and time and ultimately increase volume.

I'm just sort of curious, overall, your view on AI and how helpful it can be to your business, and then I have a follow-up.

Sure. You captured some of the points nicely there, Mike.

I'd say broadly, we're optimistic and enthused about the potential AI has in a number of areas. Specific in terms of things we're doing within our company, the ability to both drive efficiencies as well as support our revenue growth objectives, we see lots of opportunity.

We're already incorporating it into pricing optimization, some of the showtime optimization efforts I mentioned, our app development work in terms of how we're doing our software development. We've even got it going in our hiring activities within HR and our guest services.

There's a whole range of things that we're looking to utilize this for within our own company. Then on the content creation side of things, as you just mentioned, we see lots of potential for AI to unlock new types of capabilities, whether that's in visual effects, previs, and efficiencies, just in terms of movie making with timelines and things of that sort, which could lead to an increased volume of movies being made, as well as just new quality enhancements along the way.

We see a lot of potential for that. Just as every filmmaker has his or her own unique way of bringing stories to life, it would appear that AI is another tool that can enable select filmmakers to use it effectively and do new things that we haven't seen before.

Obviously, there is quite a bit of risk regarding IP and copyright infringement, and we very much support filmmakers and creatives and our studio partners in their efforts to protect their IP with AI as it evolves. It seems like if that balance can be struck appropriately and the right measures and safeguards are in place, there's just a tremendous amount of potential that AI provides for our business specifically and broadly for the industry.

Nice. Thanks, Sean.

The next question on the Warner Bros. deal, and I guess specifically focusing on Netflix here, definitely not asking you to bless anything, but just sort of holistically your view on a couple things.

One, Netflix was originally thinking of a 17-day window, and I think they shocked and awed a few of us here and went to 45-day window, maybe that's in front of streaming, so that's a consideration. Just thinking about a new partner here with a 45-day window, how you think whether that's workable or not.

Then, I guess just to maybe your own view, Sean, in terms of Netflix, if they're being sincere, or maybe if you believe, obviously, you have conversations with them that they're ongoing just as part of your business, if you believe they can be a real theatrical partner for you, not just the Warner Bros. asset, but maybe the core asset as well.

Thank you.

Sure. Thanks, Mike.

Look, I'd say, we've said this before, for a long while, we've been optimistic that in time Netflix would recognize the opportunity that theatrical exhibition provides their platform and their content, much like all their other peers are doing, whether it's traditional studios, Amazon, even Apple getting a bit into the space. We've seen through data and we've heard from the conversations that theatrical exhibition provides a real meaningful lift to engagement and retention and interest in those platforms.

We've thought for a long while there's just value that was being ignored by not taking advantage of that opportunity. Look at the recent comments providing some element of encouragement.

I would say that we, much like our industry at large, is a bit apprehensive in just placing too much stock into those comments, just given how contradictory they now are to many of the other disparaging remarks that have been made over the recent years, even as recently as middle of last year when there was references to the industry being outmoded as an idea. I think there's going to need to be more action versus comments and firmer assurances to give everybody comfort that what's being said is real.

45-day window, I think generally speaking, we all view that as a good target point that strikes the right balance of giving studios more flexibility with getting content into the home and capitalizing on the market campaigns that have been spent in the theatrical space without creating too much adverse risk to theatrical performance. As mentioned earlier, in some cases, things have kind of overshot that a bit, and it's causing some concern about what that might mean on select films.

It's a good starting point, but it also begs the question of 45 days to what? 45 days to a transactional type of offering in home, like a premium video on demand, is one thing where there's a price point there.

45-day window to an SVOD, which consumers generally view as free, is a different type of construct. There's a lot still to clarify with what exactly is being referenced.

Again, I think we're all looking for much firmer assurances that are longstanding for not only a window, but levels of continued investment and also sustained marketing, which is a critical component of this, too, versus just verbal comments and promises.

Nice. Thank you, guys.

All right, thanks, Mike.

Hey, great. Thanks for taking the questions.

Sean, just would love to get your latest thoughts on what you're expecting to see on the competitive front this year. If you're seeing anything that as you make your way out of '25 into 2026 that might make you more confident that some of the recent gains in market share are perhaps more structural or could become structural with how you position the brand as you look ahead into this next year?

Sure. Look, I think from a broad competitive landscape, I think competition just continues to grow.

I think we see industry at large improving marketing capabilities, continuing to lean into amenities and upgrades. I think that's a good thing on the whole because it creates an overall lift for everybody.

We, too, obviously, are continuing to ratchet up our competitiveness, pursuing ongoing initiatives in all the different areas we've talked about before to try to push our share even further. I think the structural gains we've talked about, we're very pleased about.

We do our best to kind of tease out how much is content mix and capacity constraints relative to structural things. We've said, we believe at least 100 basis points, growing beyond that 100 basis points of our gains since pre-pandemic levels we believe are sustainable, and we continue to push that further.

I think we feel good about the direction we're heading in, and I think our ability to continue to compete as overall competition grows.

Great. Thanks for that.

Then Melissa, maybe just a follow-up on margin. Curious if there's any more help you could perhaps provide investors just on the magnitude of margin expansion you would expect to see in 2026 if box performed in line with expectations and given some of the puts and takes you called out on the expense side a bit earlier?

Thank you.

Yeah. From a margin perspective, again, as I mentioned earlier, really box office and attendance are going to be the primary drivers, and given anticipated growth, we do believe that that supports margin expansion.

There are a number of other variables at play. We've talked about on the average ticket price side and per-cap side that we do expect to continue to grow those top-line measures.

We've talked about market share a bit. We'll have to see how individual films shake out to see where market share trends.

Then from a big-picture expense standpoint, as I was alluding to earlier, we do expect to gain some leverage over our fixed costs, and that's particularly in the US where we have a higher fixed cost structure. On the variable expense side, film rental and advertising, salary and wages, concession supplies, and then in the case of international, facility lease expense, those will fluctuate based on attendance and box office performance, although not necessarily at the same rate.

Other factors from a modeling standpoint to consider would be ongoing inflation impacts on wage rates and certain concession categories. Also from a film rental standpoint, just keep in mind that that's going to vary depending upon the mix of blockbuster content.

Then utilities and other expenses, I would just call out there, we expect them to remain elevated as we continue to address deferred maintenance needs across the circuit. Albeit from a year-over-year standpoint, I don't expect that to be a meaningful headwind given that we started those efforts in 2025.

Also on utilities and other, just keep in mind electricity costs, which have continued to be impacted by rising market rates. Outside of that, we continue, as always, to pursue productivity initiatives and cost-mitigation strategies to maximize our profitability and margin potential.

Great. Thank you both.

Mhm.

Thanks, Stephen.

Okay. Thank you, Donna, for your help, and thank you to everyone for joining us this morning.

Really appreciate the time and all your questions, and we look forward to reconnecting in a few months to share and discuss our first quarter 2026 results. Have a great day.