MoviePass Runs Out of Money
Mark has taken great joy in documenting the rise and apparent fall of Moviepass on this site. His original review is still incredibly popular as new members seek to learn whether this seemingly “too good to be true” service is right for them. Unfortunately, barring a drastic change, the service might not be around much longer.
RELATED: Our full review of the Sinemia movie plan service
Here is what happened:
- Moviepass is owned by an analytics company called Helios & Matheson Analytics Inc.
- This company has been burning through cash because the service is so unprofitable.
- Earlier this week they did a 250-1 reverse stock split to get their stock price above $1 to avoid delisting. After the split the stock was around $20 per share, but that has now fallen to $2.71.
But that’s not even the worst part.
Yesterday there was a service outage. In a disclosure to the SEC, the company said it was because they ran out of money! They were able to secure a loan to resume today, but some people are saying the service still isn’t working. I’m not sure who would loan them very much money at this point.
Other Issues
In addition to simply running out of money, some users are also reporting that they are being charged surge pricing even when a theater is almost empty. According to Insider, the company claims they are still testing out the surge pricing. Perhaps this is just an effort to get more money to keep themselves going?
Bottom Line
The stock has crashed and the company was shut down temporarily by their payment processors for running out of money. While they claim their vast amounts of data has incredible value and that they will be able to be profitable once they reach 5 million subscribers, the reality is that I don’t see that happening. Only time will tell.
What do you think about Moviepass? Are they done?
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We just buy the $5 tickets at AMC on Tuesdays. Reserved seating, recliners, happy.
Movie pass is up and running for me. I just checked in and seeing a movie. I signed up 3 months ago and have seen at least 30 movies. So far so good.
I joined about 6 weeks ago and have had my credit card charged twice already and I still haven’t had time to see a movie.
I was going to see a movie earlier today and when I got to the theater movie pass was not working, with the message “technical difficulties”. However 30 minutes later it was working and I was able to see a movie after all. I will enjoy it while it lasts.
I bought the annual pass, while it’s only a couple months into the annual membership, it offered way more than I bargained for, it was a joy ride to say at the least.
Maybe they could merge with The Plastic Merchant.
@toomanybooks
Hahaha
Maybe moviepass’s CEO was very sick and had to be hospitalized? Now, the other staff are scrambling around figuring out what to do
I’m left wondering if they do go under if those of us who bought the annual passes will have any recourse. Don’t know if a charge back is worth the effort.
I wonder if Costco will give me partial refund for the annual pass?
Yeah, same here
Probably gotta go through the credit cards
Still not working as of Friday.
Now working, but strangely, graying out some movies although haven’t seen them. On an annual fee, so no surge pricing… wonder if they are just refusing to let people who are annual pass see movies they would otherwise surge price on?
Yep… Mission:Impossible. All grayed out, regardless of type of showing.
What they should have done is just buy some failing movie theaters in a bunch of cities as a foundation and then movie pass users could only use the service at those theaters. I’m sure the theaters would have sold out all the time and you could actually turn a profit. Pretty stupid they basically just gave people credit cards to do what they want with it.
We were on the fence with MoviePass and then AMC came out with their own version for $19.95+tax. We saw 3 movies in the first 30 days and saved us about $40 each….as a couple were 3D. I think if there’s an AMC theater near you that’s the smart way to go.
I do think after the locked-in 1YR price is up, they will increase it…but for now it’s going to save us money.