The basement of the Roxy Hotel was filled with actors dressed in fake blood for a celebration of a new AMC Networks show called "Interview With the Vampire." Hopes went up. The executives at AMC Networks thought they had a hit on their hands.
The people were correct. According to data from a research firm, the show became one of the most popular in the US.
The money that the company makes from its streaming business, including AMC+, is not making up for the loss of revenue from its traditional cable channels as people abandon their cable subscriptions.
James Dolan, the company's chairman, made clear how problematic that was for the company. He said that there would be large-scale layoffs of 20 percent of the staff.
The family controls AMC Networks. Over the last several years, the company has introduced a number of streaming services, including AMC+ and Shudder, and trumpeted their growth on earnings conference calls.
The belief was that cord cutting would be offset by gains in streaming. This has not been true.
The same forces are hitting companies like Warner Bros. Discovery. The number of adult scripted series ordered by TV networks and streaming companies fell this quarter compared with a year ago.
AMC Networks' troubles give a clear illustration of the pressures facing the industry because it doesn't have a profitable theme parks or a major movie studio to help offset the decline in cable subscriptions and advertisements.
MoffettNathanson estimates that about 30% of AMC Networks revenue last year came from fees paid by traditional TV distributors. Advertising, content licensing and other businesses made up the rest, according to MoffettNathanson.
AMC Networks reported in November that its third-quarter U.S. advertising revenue was less than last year. Lower ratings were one of the factors that contributed to the decline. AMC+ doesn't run advertisements.
According to an analyst for LightShed Partners, AMC Networks has about 1800 people working in its core business.
AMC Networks is no longer alive, according to Mr. Greenfield.
AMC Networks is a holdover from earlier times. AMC Networks, which was founded as a joint venture between several TV companies during the cable boom of the 1980s, was once a part of the US media market. As the cable business grew, deal-making was the surest path to growth.
AMC Networks moved in a different direction. AMC Networks started niche, targeted services instead of selling out to a big rival with a streaming service. There are now prestige dramas on the service. Shudder arrived the next year. AMC Networks executives were comparing the company's services to boutiques.
Some people converted to the strategy. In November 2021, MoffettNathanson said that AMC Networks had a clear path forward and that its streaming revenue growth would surpass declines in traditional TV. On a conference call last month, Christina Spade, the company's chief executive, said that AMC Networks had attracted more than 11 million subscribers to its streaming services.
Three days after the call, MoffettNathanson warned that the traditional TV business was declining faster than expected and that AMC might never return to free cash flows. The AMC Networks said that Ms. Spade had stepped down three months into her job. According to a person with knowledge of the decision, the board decided that she wasn't the right leader to steer AMC Networks through the turbulent period ahead and gave her a separation package worth about $10 million.
Ms. Spade didn't reply to questions.
The next moves of AMC Networks will be decided by Mr. Dolan, who became the company's interim executive chairman. AMC Networks said in a statement that it would continue to distribute its shows and movies across multiple platforms and make its traditional TV business more profitable with targeted advertising.
The cost measures we are taking are focused on helping us navigate the current challenges being felt across the media industry as well as the broader economic outlook
As Mr. Dolan ponders the future of AMC Networks, industry speculation will inevitably turn to whether he will join his peers in considering a sale to a larger rival. It's a bad time for that. As investors become more cautious of unprofitable streaming services and declining cable TV businesses, the share prices of media companies have fallen. The ad market is not doing as well as it could.
According to people with knowledge of the matter, AMC Networks doesn't own some of the shows that it made famous, such as "Mad Men" and "Breaking Bad." AMC Networks has begun to promote new shows from the Anne Rice series. Any price that the company is able to command in a sale would be affected by the company's library value.
AMC Networks' channel portfolio is no longer necessary for distributors to carry.
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