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Good to go. So, Rich, welcome back. We're here with Rich Gelfand, CEO of IMAX Corporation, and we're thrilled to have you. Yeah, I mean, obviously, Jessica, there's not a better time for us to go to a conference like that. Our company is in the midst of a dramatic awakening globally, so happy to be here. So, what a year it's been. Since you were here last year, your stock has basically doubled after spending years in a tight trading range. I mean, for years it was like $18, lucky number, but still, nice to be in the 50s. So you've reached a different level of relevance from moviegoing. You just mentioned like a bazillion kids outside the theater, the IMAX theater the other day, very young. So clearly, you know, you're more relevant than ever, and you're packing them in, but having Chris Nolan in your corner helps. But what do you think has really changed in the IMAX opportunity in the last year or so? Yeah, this is going to sound like hyperbole, but I think it's really the beginning rather than the later stages of what's going on. And when we looked at our slate for the year, I was the most bullish person in the company on Odyssey. And our record up until that point had been $225 million for Avatar. keep in mind that's on one percent of the screens in the world and today we're knocking on the door of a half a billion dollars so how many films do a half billion let alone in IMAX only and it's the comment I made when I was telling people at IMAx they didn't understand the impact of this movie was that I don't know where this is going to take us but it's going to take us to places they couldn't imagine so it's really there's a lot going on beneath the surface but even publicly on the surface so yesterday we put out a release with the Walt Disney Company saying that they're re-releasing Star Wars next February the 50th anniversary and it was filmed in 35 millimeter film and they're releasing it in IMAX and more importantly they're releasing it in IMAX film, they're printing it out and doing that. And they're also announced they're doing Starfighter next year, the Ryan Gosling one, which I've been on set for. And I'm very optimistic about that film with IMAx prints. And, you know, we're now in week eight. And like you said, there are lines around the block. We've extended the film run until the end of September. And what I described to you, I mean, this is just one small anecdote, but I think it's funny, is Chuck Schumer called Adam Aaron, the head of AMC Theaters, and said, I've got to see The Odyssey. Can you get us in? So Adam called me and he said,I can't get anybody in. Can you gets anybody in? So it's a phenomenon, but thinking about it more in business terms, I think it's a product breakout. And just one final thought is our next big film release is on June 3, which is around Christmas. And we put the tickets on sale like two weeks ago. And if you stop today, which are three months in advance of the film's release, it would be one of the most highest pre-sales in our 60-year history. So I don't think this is a one-off. I think it's symptomatic of a real change. Absolutely. So if you think about IMAX, as you assess the business, how do you define where IMAx is today and where you see the opportunity from here? Yeah. So where we are today, let's put it in some quantitative terms, is um for this quarter we're over 600 million dollars in box office so far and it just started to be september and our best quarter ever was in the mid 300s so and then when you look at what's coming forward now we have resident evil i know you had um sony on before us and tracking is quite good on that we have diggers which is tom cruise movie coming out i mentioned um doing three coming out we also have very interesting project which is called the misadventures of cliff booth and it's a sequel to netflix that netflix is doing to once upon a time in hollywood and david fincher directing it stars brad pitt and why that's interesting it's the it's only being released in imax exclusively for two weeks so anyone in the world that wants to see that movie in a theater has to go to imax to see it and that's you know on top of odyssey still playing we're having trouble getting it off the screens because the demand is is so high so you know it's a very exciting time And as you look in, you know, some of 2017 is known, and the film slate there looks really good. The Dune play over, because it opens in Christmas, will be very good. And then you've got at the end of the year the next Avengers that we're playing there. And you have Frozen, and you have Thomas Crown Affair with Michael B. Jordan. And we're doing, again, with Netflix, Greta Gerwig's Narnia. But to me, as exciting as all that is, it's the stuff that hasn't come to fruition yet that I was mentioning. But I think when you see alternative content, which we do like sports content and concerts, there's going to be a lot of that that's in the works, that's going on behind the scenes. Merchandising at IMAX rounded to zero before this year. but we did something called an imax popcorn bucket and because it was a test for us we put 2500 on sale and um within 90 minutes they were gone and we kept putting more on sale and couldn't keep up with the demand and i think we sold like 25 000 of those and then we have a film strip from odyssey that we put on sale for $40 a film strip and we sold 30,000 of those in like an hour so when you look at our plans for 2027 we're going to lean into merchandising obviously I didn't know this but popcorn pockets our AMC does a hundred million a year in popcorn buckets we did zero before this year and And then you just look at more films being filmed with IMAX cameras and released. There's just a lot of things going on. And it doesn't end in 27. It just starts. We're doing The Beatles with Sony, which is four separate movies, and they're being filmed with Imax cameras. We're dealing with Miami Vice with Joe Kaczynski next year. So it's just really an incredibly exciting time. When did the Beatles movies come out? The Beatles? April of 2028. Wow. Actually, Robbie didn't mention that, but I know that's something we've been working on. It's very exciting. Sam Mendes is directing it, which is a side point that New York Magazine just ran an issue of the top 50 or 100 directors, today most powerful, and I think of the top 20, we work with 19th. So it's not a matter of people don't know us. We've built this business over 60 years and we have the relationships, but it's, as I said before, it's like a new awakening. Studios are recognizing that IMAX is really important to a global blockbuster release. Absolutely. But given this amazing recent performance, how much do you think can be attributed to the huge content cycle that's sort of coming out of, like, finally post-strikes, both strikes and obviously COVID, versus IMAX just simply gaining share globally? Well, it's really both. So we were on a very strong growth curve. And 2019 was our best year ever. 17 and 18 were great. Then COVID came, and obviously we were affected in a significant way. And a lot of companies were talking their book and saying, nobody's ever going to go back to theaters. It's the end of theatrical. But actually, even though the theater industry is having a good year this year, we had our best year ever in 2025 and 2023 and 24 were doing well. And that was because of market share gains, like the premium sector of which we're the primary player has been really doing well. And this year will certainly be a record box office year for us. We're already approaching that. So it has a lot to do with what IMAX does and what we've done. But, you know, there's no doubt it's a good year for content. And where we really do well is if it's not a franchise, but it's someone trying to build a franchise. So for Sinners, Ryan Coogler filmed that with IMAX cameras. And I think he won Best Director. And as you know, it was a breakout hit. The biggest movie Apple ever did was last year at Formula One, which IMAx did close to $100 million in. So I think the move towards proprietary content and first-run content and kind of the broadening of diversity of movies is good for us. So I Think we're getting there on our own, but I think The Hollywood Megatrends are also helping. Right. I mean, others have tried to replicate the success and the premium experience, and we're still seeing others trying, like past and present. But without much success, who do you view, if anyone, as your more tangible competitors? Obviously, theatrical is a competitor in general, right? People could see a movie in a regular theater or they could see it in IMAX. And you were more polite than to call them the copycats. But the copycat's about the only thing they have in common with IMAx is they have an X at the end of their name. Right. So, you know, we spend, you know, a hundred million dollars a year in SG&A. They spend zero. So they take a regular projector and they put it on a big screen. And what a shock. It doesn't look better. And also we monitor everything in the world in real time. So we make sure that the standards are kept, the quality is there, people go and maybe most important directors really lean in to IMAX. So with the Odyssey, it's not only the technical aspects, but Chris Nolan filmed it all with IMAx cameras the first time. He was, you know, very generous in going around and saying that's the way you have to see it. So, you Know, I think the way we're positioned and kind of an end-to-end solution or something that keeps the competition at bay. You know, Of course, you're cognizant, especially from a pricing point of view, but I think that's even a room for growth for us. I think the exhibitors have – and again, the model is a licensing model, so the exhibitor has set the prices. We don't, and I think they've been a little conservative in that department. And the greatest example is Odyssey, where a ticket is similar to a regular ticket around $20, $25, but they're being resold online for up to $1,000. So I'm not advocating that at all, but I think there's some room there. Right, right. It was a crazy black market for Odyssey. But your relationship's strong across the board. You mentioned Chris Nolan and other directors, but your relationship with Netflix seems to be strengthening as well. So they selected IMAX for an exclusive theatrical window for Narnia, and as you mentioned, the further misadventures of Cliff Booth exclusively in my IMAx over Thanksgiving 26 ahead of Narnnia, which is 27. But Netflix has also signaled an interest on focusing on the more big event type of content. Do you think IMA X releases fit into that? How do you see your relationship with Netflix evolving from here? Well, first I'll give you a general answer, Jessica, which is we've done some research, and the fact that a movie is being released in IMAX helps its streaming run later. So we looked at movies not being released on IMAQ, and IMA X had a profound effect on the streaming end of the run. So I think this test with Netflix is kind of exciting, and I'm not just looking at what the box office is to whether it's successful or not, but I'm looking at the streaming aftermarket and what happens to that and how it affects the vision of the film. And I think there's no question that IMAX creates an event around a film and an event aura. And one of the best examples is Sinners. It was a movie about vampires in the Jim Crow South. Now, if you had gotten the elevator pitch to that and you ran a studio, I don't think you'd run out and say, there's a market that's evolving. But Warner's did an amazing job, and Ryan Coogler did an Amazing Job in promoting the IMAX of it all, and it broke out in an auteur filmmaker sort of way. And I think Netflix knows that that's what IMAX does. So I think both Greta's movie, The Adventures of Narnia, and the Cliff Booth movie will have that same kind of impact. So, yes, I think Both will do well at the box office. But more significantly for Netflix, I figure it creates an aura around the project and says, you know, this is something important. And as you know, Netflix, after we did the deal, broadened their audience and they're releasing Narnia in regular theaters as well. So I think certainly they could speak for themselves, but from the outside, it looks like they're testing the waters and see how that works for them, both theatrically, but more importantly, in the streaming world. And, you know, fingers crossed, but I think it's a promising experiment. Right, right. IMAX generates a substantial portion of its revenue from markets outside North America. How much runway is left for growth in international markets, and where are you still underpenetrated? So in terms of penetration, every couple years we release our addressable market. And right now we have 1,800 theaters open, and our addressable market is about 4,500. So we have a very long runway to go. We also have about 500 theaters in backlog, which means they're signed, and over the next couple years they'll be installed on a global basis. I think particularly Asia Pacific, we can double our presence there, and like Japan has been on fire, I think other territories that are promising are Australia, where we had two theaters two years ago, and I think we're up to 10, and I think we have another 10 set to install this year in the Middle East. I mean, at the moment, obviously, the war is causing a lot of disruptions there, but we have a big backlog there, and our theaters have done very well. Western Europe, surprisingly, is a good opportunity. So in Germany, I think, we have like 10 theaters, and in Ecuador, we have 10, and, in the UK, we are 60. So obviously, I think France is an area that can grow. And surprisingly, North America, even though we have 400 theaters there, we've had recent good success there. Right. How significant is local language as an evolving percentage of UMECs? I think it's very significant. We set a record the last couple of years with the percentage of our box office in local language. It was roughly 20, 25 percent. And just to let her explain what that means, that means that we'll take a film. Let's say it's an Indian film and it's made in India for Indian audiences. And we'll release it not only in India, but we'll released it in other countries where there's a lot of Indian expats. and a couple examples anime has really taken the world by storm and I have to admit we didn't see it coming how strong it was so some of the anime we do in Japan when we show it in other countries like China it does a bigger box office in China than it does in Japan and I missed your Sony presentation but I assume they talked about it a lot, but I think we've played a role in seeding other markets for anime. Studio Ghibli, which is kind of the original creator of anime, we did a re-release and they were really opposed to doing it any way other than traditionally because it was the inventor of that format and it really felt it didn't want to take a risk, but it did phenomenally well in re-release, and we're doing other things with Studio Ghibli as well. So that's an example where we took a local language, well-known product, and globalized it. And I'll come back to your question, but its an important one. Most people don't realize that we're global. So when you think of exhibitors, they're asset heavy models. A lot of their revenue depends on concessions. Our model is a licensing model. So we don't own the theaters or hard assets and we don' t make money on concession. You know, God bless our partner. They can make as much as they want. But our revenue comes from theater performance and film performance. And it's tied to that. And again, back to the word global. So people look at IMAX and they go, oh, well, February is not a good month. So, you know, we're not excited, but February is typically Chinese New Year. So in 2025, we played a film called Nezha 2, and the film did $1.2 billion globally, and I think we did around $160 million. But again, I think one reason, you Know, our companies had an awakening, but so is our stock. And I think people have come to the incredible conclusion that a dollar earned offshore is equivalent to a dollar in the U.S. And about two thirds of our revenues are outside the United States. And, you know, I think that diversification is a powerful thing. And again, in terms of global, some of our biggest hits in any year are global. And I think that's one reason the analysts have struggled a little bit because, you know, they've heard of Star Wars, they heard of Marvel, but they've never heard of Nejah. But we have. Last year, we released 120 pieces of content, and that includes local language films, event films, concert films, sports films, and I think you're going to see a lot more of that. Right. So given what you just said, how do you think about capital allocation across regions to kind of continue to drive this opportunity? So we've, over the years, bought back stock on an opportunistic basis. As a matter of fact, we bought some stock back in the second quarter this year at about $35 a share. It's now between $50 and $55. And, you know, obviously our third quarter is going to be extremely good. I gave you the outline. So the revenue side, so we're going to generate a lot of cash. and our cash generation has gone very well. So I think that's a buffer if the stock market encounters any turbulence. We've also been using our cash to help expand our network. So the exhibition sector, which are our partners, they're not as flush as we are or maybe the studios are. so we've been using our cash in the form of joint ventures so our old model used to be they would put up all the money and we would license our technology then we went more to a joint venture model where we take a bigger percentage of the box office but we put up more of the capital and they put up less of the capitol and this year we've Been transitioning to putting up more of the capital. And also since they've been doing very well, the paybacks have even been better than we modeled in doing that. So I think, you know, given where we're going from a cash flow point of view, those are primarily the two areas, which would be, you knows, stock backs, if it warrants, and expanding the network faster. So for many years, franchises and superhero films dominated the box office. But this year, we've seen a wide range of genres have success. How do you view the dynamics and the impact for your business? Like, how diversified? Yeah, so I think diversification is great for us because what we offer is the IMAX experience. And IMAx, I've been running for over 30 years. and 30 years ago we commissioned a study as to what we want to be when we grow up and what came out of it was rather than people focusing on the movie we want people to say when they wake up in the morning what's playing at the IMAX theater and I want to see it in IMAx and I'm not saying we're there yet but I think the last several years have shown that that momentum is clearly happening and that's why i think you know sinners did so well and yes odyssey is an amazing movie but universal and chris nolan marketed as universal in imax and i think as you try and stand out with a variety of different content you know the imax of it all becomes more important again i think formula one is a great example because people said wow seeing car and you know as much as i still believe in superhero movies and i think they'll work i don't think there's anything so unique about zero superhero movies that say you know wow i've got to see in an imax and to some extent we've seen the last few years some of that has run its course so i think you know IMAX becomes even more of the attraction so it's a good thing right and you mentioned merchandise before which I don't think most of us thought about with IMAx um so it seems like a new potential revenue stream um you know can you talk a little bit about like where you can take this and maybe you know what what is the response to the popcorn buckets tell you about the fandom of it all for iMac. Yeah, it tells you that we badly mis-underestimated it earlier on, and we should have done it sooner. But since we don't own IP in the movies, that's owned by the studios, I think we need more bespoke merchandise. So the one I would focus on even more than the buckets is we sold these film strips, and the I think the selling price was around $40, and the cost of goods provides a really healthy margin for that. So I think where we're going to take it is lean into what about IMAX makes this movie special and then try and find a crossroads between what makes it special and what we can produce. And obviously the popcorn bucket, I wish we had a slide of it, Because besides being a bucket that looks like the camera, you can look in the viewfinder and you can see a film strip of the Odyssey and you press a button and it lights up. And our fan base is, you know, crazy in a good way. So I think we could turn that into collectibles. And, you Know, when you think of movies, although we haven't thought about it all, and I'm sure Sony will kill me. But at the Beatles movie, where there are four separate movies, you could think how to do four kinds of merchandising, and you could think of how to tie them together. So I'm really excited about that opportunity. That's incredible. The brand extensions, the merchandise, it's actually very exciting. So anyway, moving on, given the strength of your brands and premium offering with leading technology, how do you view the opportunities and the risks related to AI? You knew there was going to be an AI question. So, yeah. So, first of all, I'll start with the opportunities. And for us, they're in two primary areas. One is in cost reduction, which applies to any company. And we have had a concerted effort over the last several years. And certainly the majority of our company is involved in using AI for things like finance and typical corporate functions. And we've done things that would seem simple. But for example, our box office, remember we're in 92 countries with 120 piece of content so it seems like gee this should be a fairly easy business you release a movie but when you start doing the math I mean again it's around 2,000 theaters times 120 piece of content there's a lot of things to track and a lot information to analyze and AI really helps us do that and more importantly draw lessons from it so we're doing that and the other thing is at a more basic level what we do is we really enhance images so if you take it to lay terms we blow up things and not blow up like dynamite but blow them up so and make sure they still look good and AI can really facilitate that. So we're experimenting with ways. And again, that's not costing anyone jobs. You know, that is something only we do, and it will help us do it better. You know I think it's inevitable that the studios and the filmmakers use AI in certain situations. You know, we're not going to lead the pack in figuring that out, but clearly, you know, if the studios and filmmakers decide it's in their interest, then we'll use it to our benefit as well. As you look at the film slate for the next year, you mentioned a few things earlier on. Is there anything else you would like to add to what gets you excited? Is there Anything that you think is underappreciated? i think what's underappreciated is that we're a platform and the platform earns money in many different places so we spent most of the time here and it's probably my fault i spent too much of the time you know talking about box office and films but with every theater in the world comes a maintenance contract. And it's almost like maintenance and computer services. So if you are in the IMAX network and you sign on, you pay us a very nice margin amount every year to maintain your system. And we do that because we're not going to release theaters around the world unless they're up to our quality standards. And they're only up to Our quality standards if we do four visits a year as I said we monitor them in real time so on January 1st when we turn the key on we have a lot of recurring cash flow even if we don't open one new theater or even if don't have one new movie another area where we generate significant revenue is when we open new theaters so we have different models one of the models I talked to you a little bit about is the joint venture model on that model we make the bulk of our revenues as a percentage of box office but a very significant percentage of our business comes from selling new theaters and when we sell new theaters we do get a smaller royalty but we also get an up an upfront payment and an ongoing cash flow payment, and that's a significant number. So in our second quarter this year, our box office was a little bit less than we guided to, but these ancillary revenues from other important parts of our platform far exceeded what anyone thought they were going to be. So we beat on the EBITDA and the EPS line. And I think people sometimes don't see the various places. And then I guess coming back to box offices is gross margin. So when we do over $250 million a quarter, our gross margin is higher. Our overall margin is higher because we've covered our fixed costs so our margin goes up dramatically as the numbers go up so that's another place i think you're kind of summarizing the answer is not to be myopic and look just at box office but to look at the different revenue streams well on the on the broadening out of like revenue streams whether it's merchandising brand extensions you know selling theaters, opening new theaters, maintenance, as you said, all of those things. You also talked a little bit about different kinds of content. Does that come with any kind of different margin? Is the cost profile different? What excites you? You mentioned sports, concerts, other things. Yeah, those are probably the top two I would mention. So sports, one year we did the NBA finals in Taiwan, But there's no reason we can't do the NBA Finals in China, which is obviously a bigger market for that. We've done hockey, NHL hockey. We've gone college football. We did the Olympics, the opening ceremony in Paris, and it looked amazing. I mean, the numbers were fine. But visually, when we show that to other professional leagues, if you remember, it was in the rain, and it was very artistic, and IMAX, it just looked incredible. And we did it with NBCUniversal, and they were very happy about it. So I think that in concerts, actually, in coming in the next week or two, we have Oasis, where the pre-sales are pretty good, and we have Blackpink coming, and, you know, we Have a number of other things. You know, the margins are similar. If you want to dream ahead, and this is more speculative than other things I've talked about, but you could probably package those events with merchandise because of the fan base. And we've been charging consistent with an IMAX ticket price. But if you package it, you know, rock and roll fans and T-shirts and all that. So, you Know, we're just really experimenting with those kinds of contents and they've been, you know, pretty good that things we bring back old movies. So we brought back Interstellar and I don't remember exactly, but I think we did five million in a weekend when things were slow. So I do think there's a lot of potential, but we're just starting to understand it now. Amazing. So this is an industry question, but obviously we're seeing a lot of consolidation. I mean, eventually Warner Brothers will be consolidated, whether it's Paramount Skydance or not. I mean it hopefully will happen at some point. NBCU is separating out from Comcast, so Universal will be separated. Netflix, when they were trying to get Warner and, you know, wound up not, said they were developing their M&A muscle. How do you, like, you see all of these things, you know, all of the things that are going on in the world, all these moving pieces, how do you see the industry evolving over the next three to five years? And is this good or bad for IMAX? Well, first I'll answer the end of your question and then I'll back up to the beginning of it. You know, I hope I've conveyed in a clear way that our primary relationships are with filmmakers. So wherever the filmmakers end up, they're going to end up somewhere. They're the ones that we're really talking to about the content. And one mini example, which I kind of forgot, so thank you for having me remember it, is the movie Hail Mary this year, which was Lord and Miller and ended up at Amazon MGM. And they came to us and they released it in imax and film prints and again we did a hundred million dollars again this was not a franchise that anyone had heard of and i know i know that amazon and mgm were extremely happy about it and when you go through the one so f1 was the biggest streaming property of apple ever had And that was a streamer, not a studio. Hail Mary was a steamer. The ones we've talked about with Netflix are streamers. Warners is a fantastic partner, and we have a number of movies coming with them, including Dune with them and Legendary. But those relationships with the filmmakers are not going anywhere. As a matter of fact, we've talked many times to David Ellison and Paramount where if that does happen, they're going to certainly ramp up their IMAX production. And we have a terrific relationship with them. We've done the Mission movies, Maverick and Top Gun. And, you know, I think if there aren't enough studios and streamers, there'll be organically different ways that content is released. So whether it's the smaller studios like Lionsgate and Josh Grode, you Know, those guys are going to capture market share. So I think we'll be, you know, perfectly fine. In terms of the industry itself, I think it'll survive, but in a different form. Kind of what I was just saying, I Think the key content providers are going to want places to release their content. And, you Know, let's take your major filmmaker. Let's just don't want to be sort of agnostic. So let's use someone with the ears, Steven Spielberg. You know, if Steven wants to make a movie and there's not enough studios, he's going to be able to attract capital. So I think when you look at this, if you focus on the entities, you're really missing the point. The focus should really be on the capital, and the capital will be there for good projects. So to wrap up, you know, you've talked a lot about your vision for IMAX and some of the big drivers, a lot of the diversification, a lot of growth drivers, margin improvement. I mean, is there anything that you would add to what we've discussed about, like, the next several years? Like, what else can drive your growth or what else would you emphasize? I think we don't know yet. And, you Know, I'm not being coy. We just don't. So we just signed a deal with an audiovisual manufacturer, an important one in China, and they and we are designing an entertainment system to go in vehicles in China. And when you think of the vehicle market, I think our partner thinks, because they'll be driverless cars, that cars are going to increasingly be sold based on entertainment systems. So we have our hand in the water right now on that. I don't know where it's going to be, but we're there in case it does happen. On the Vision Pro with Apple, you know, there's an IMAX function on that. When Star Wars was shot by Disney and Lucasfilm, they took the Vision Pro and they invented a way using that to film with the IMAx aspect ratio. Now, if you had asked me, was any of these on my list of where we were going to go i would say no but i think when you have such strong brand recognition i mean this merch stuff is is crazy we were i was interviewed by the new york times for a story on popcorn buckets and i had fun with it with the reporter because i kind of said when i was growing up did i think i would talk about the popcorn bucket this is no but I think what we built is a brand and a platform and I think they could take us in a lot of places. Amazing. You've just gone from strength to strength so we really appreciate you taking the time to be with us. Thank you Jessica. Appreciate it.