MoviePass owner has tumbled 98% since its high in October, as investors wonder if it will run out of cash

Business InsiderMoviePass.
  • MoviePass owner Helios and Matheson Analytics was trading at around 60 cents on Friday midday.
  • That’s an incredible 98% drop from its 52-week high of $US38.86.
  • Many observers question the firm’s long-term viability, including its independent auditor, which said in April it had “substantial doubt” about Helios and Matheson’s ability to stay in business over the next year.

It’s been quite a roller-coaster ride for Helios and Matheson Analytics since acquiring MoviePass, and changing the startup’s business model to offering a $US9.95 monthly subscription to see one movie per day last August.

The stock’s 52-week high was $US38.86 in October, as excitement built around the impressive subscription growth, and the potential disruption of the movie-theatre business. But now it’s trading around 60 cents (as of midday on Friday). That’s a 98.5% drop.

The first recent tailspin for HMNY came in April when it filed its 10-K to the SEC and reported a loss of $US150.8 million in 2017. The company’s independent auditor also said it had “substantial doubt” that HMNY would be able to stay in business over the next year. That scared investors and the stock dropped 50% from its highest price the week before the 10-K filing.

The stock again crashed on Tuesday following HMNY’s update of its cash and losses to the SEC.

HMNY said it had been losing about $US21.7 million a month since September, and only had $US15.5 million in available cash. The company did, however, note that recent tweaks to the service had led to a reduction of “more than 35%” in its cash deficit during the first week of May.

Investors clearly didn’t think that reduction in losses was enough, and sent the stock zooming back down under $US1. And HMNY has showed no sign of rebounding since.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.