Cinemark Holdings, Inc. (CNK) Earnings

Management highlights

- Overall Financial Results * Q2 2026 set multiple all-time quarterly company records, with worldwide revenue exceeding $1 billion for the first time in company history * Record quarterly adjusted EBITDA reached $294 million, with an adjusted EBITDA margin of 27.1% (only 10 basis points below the company's all-time record) * Generated nearly $300 million in free cash flow, spent over $60 million on capital expenditures, and returned excess capital to shareholders via dividends and stock buybacks * Achieved all-time records for global admissions revenue, concession sales, per-customer spending (per caps), premium amenity performance, and loyalty program transactions - Strategic and Operational Progress * Credit for record results goes to the global team's execution, long-term strategic investments, a strong slate of film releases, and improved operating leverage * Continued expansion of premium large format (PLF) auditoriums: in H1 2026, the company added 7 new XDs, 12 new ScreenXs, 2 new IMAXs with 3 new 70mm projectors, and 112 new D-Box auditoriums; it currently has ~350 total PLFs globally and 660 auditoriums with D-Box installed, with significant remaining runway for future additions * Loyalty program has expanded to 40 million addressable customers worldwide, enabling personalized direct marketing to drive repeat attendance * Q2 2026 saw strong growth in younger (under 25) moviegoer frequency, up ~20% year-over-year, driven by films that resonate with this demographic; younger audiences increasingly value the communal, disconnected theatrical experience * Merchandise concession sales hit a quarterly record of $25 million, supported by optimized inventory, curated assortments, and strong film slate demand, with further growth runway remaining * Creator-led, internet-native films have delivered unexpected strong attendance, bringing new younger audiences to theaters, and are viewed as a growing long-term content opportunity

Guidance

No formal full-year or future period quantitative financial guidance was provided in this call. Management's qualitative forward-looking outlooks are: * Management is exceptionally well positioned for future growth, and expects to continue benefiting from past strategic investments, strong customer loyalty, and industry-leading operating capabilities * Initial line of sight for the 2027 film slate is positive, with a higher volume of announced releases than prior periods, though final results will depend on content resonance, marketing effectiveness, and release spread * The near-term outlook for H2 2026 is positive, led by upcoming high-profile releases including *Spider-Man Brand New Day* with strong pre-sales momentum, following ongoing momentum from *The Odyssey* * Management expects creator-led and non-traditional content to become a larger, more meaningful source of theatrical supply that can help fill gaps in the annual release calendar

Segment performance

This earning call does not break out formal segmented financial performance with absolute values and revenue contribution percentages for individual product or geographic segments. Discussed directional performance includes: Domestic delivered an all-time high 27%+ adjusted EBITDA margin, driven by operating leverage from strong attendance and market share gains. Latin America delivered an all-time high adjusted EBITDA margin, with market share gains, growing average ticket prices and concession per caps, and successful mitigation of cost pressures offsetting inflation and labor regulatory constraints.

Risks & headwinds

- Potential capacity constraints during peak box office periods with multiple concurrent high-profile large-budget film releases could limit overall attendance and revenue * Latin American operations face specific risks including FX volatility, higher inflation, restrictive local labor laws that limit staffing flexibility during attendance upswings, and government-mandated wage increases that outpace general inflation * Higher electricity market prices in key operating markets (such as Texas) are expected to create ongoing year-over-year cost increases in H2 2026 * Unexpected fluctuations in film performance: while strong content can drive outperformance, unforeseen underperformance of major releases negatively impacts results, and content resonance cannot be fully predicted in advance * Crowded release schedules concentrated in peak holiday and summer periods create suboptimal box office outcomes, as overlapping major releases create unnecessary competition that limits overall industry revenue

Analyst Q&A

• Q: David Karnofsky (JP Morgan) asked if the unexpected Q2 domestic market share gain amid high box office was surprising, whether market share gains are sustainable, and if extended theatrical exclusivity windows are already showing consumer impact. /

  A: Management said they were very pleased with the results, that natural variation in how films performed across the quarter reduced expected capacity constraints. They noted extended theatrical exclusivity changes were newly implemented in Q2, so long-term impact is still unclear, but the record post-pandemic quarter indicates the shift is off to a positive start.

• Q: Eric Handler (Roth Capital) asked how much more room Cinemark has to add premium auditoriums like IMAX, XD and D-Box across its footprint. /

  A: Management confirmed there is still significant healthy runway for future additions. Auditorium screen size limits PLF expansion, but there are many opportunities to add a second PLF in existing theaters that only have one, and flexible D-Box (installed in select rows rather than full auditoriums) has very limited capacity constraints.

• Q: Chad Finan (Macquarie) asked if Cinemark's strong cash position has changed its capital allocation strategy across balance sheet strength, reinvestment, M&A, and shareholder returns. /

  A: Management reaffirmed its existing balanced, disciplined three-pillar strategy: it continues to prioritize maintaining a strong balance sheet and funding high-return growth opportunities (including M&A and theater improvements) first, with shareholder returns determined by leverage, liquidity, and alternative investment opportunities.

• Q: Mike Hickey (Stonex) asked if successful low-budget creator-led films can become a meaningful new source of theatrical supply and help fill release calendar gaps. /

  A: Management confirmed that creator-led films have already delivered multiple surprise hits, bring built-in younger audiences, and can absolutely help fill off-peak calendar gaps. They noted Hollywood is already increasingly pursuing this IP, and expect this category to become a meaningful ongoing growth opportunity for Cinemark.

• Q: Robert Fishman (Moffat Nathanson) asked if macro pressures like higher gas prices are changing consumer concession and attendance behavior. /

  A: Management stated that moviegoing and concession spending has historically been far more dependent on the strength of the film slate than general economic cycles. They added they have not seen any measurable impact from recent macro pressures on consumer behavior to date.