2020 Ticket Sales to Decrease Due to Pandemic and Lackluster Movie Releases
Analysts expect annual cinema ticket sales to decline by 2.6% to $11.1 billion due to the coronavirus pandemic and relatively fewer movie releases compared to record-breaking sales from last year. A sharp decline in the second quarter is expected as studios have delayed March and April releases, such as “Mulan” and “F9.” AMC Theaters will cap seating capacity to 50% until April 30. Rival Cineworld is also following the same measure.1
Retail Sales Decline, Online Sales Up as a Coronavirus Spreads
In February, retail sales declined by 0.5%, the most significant drop in more than a year, while online sales increased by 0.7% in the same period. The data shows that individual spending was weakening before the coronavirus outbreak. The uptick in online sales pointed towards individuals stocking up supplies as they limit outside activities to fend off the virus. Economists forecast weaker retail demand but more robust e-commerce sales in the months ahead.2
Streaming Services See High Growth Potential, Attracting More Competition to the Mix
Analysts expect sales of subscription-video services revenue to rise by 29% to $24.1 billion in 2020 as individuals choose streaming over other forms of media and entertainment. Growth in the industry has attracted more competition, such as Hulu, Amazon Prime Video, and Disney Plus.3
Labor Market Remains Tight for Grocers and Online Retailers
In March, physical grocers and online retailers were on a hiring spree to meet the massive influx of demand due to the coronavirus outbreak. Kroger hired 2,000 workers and with nearly 10,000 open positions across plants, warehouses, and stores. Amazon announced plans to hire 100,000 warehouse and delivery workers.4 5
Online Gambling Forecast Growth as More Individuals Have More Free Time
U.S. Online Gambling to experience rapid growth in the coming months as usage increases. The rise in online gambling will likely stem from higher demand for online entertainment as millions of Americans stay home due to the coronavirus pandemic. Gambling will likely rise for unaffected like soccer in Turkey or Russia, and those betting on futures for the next seasons of U.S. Major League Baseball and the NFL.6
Restaurants Seek Government Support and Issue Member Guidelines to Weather the Coronavirus Outbreak
The National Restaurant Association forecasts restaurant industry sales to decline by $225 billion over three months due to the coronavirus pandemic. The association seeks $145 billion recovery fund from the Treasury Department, $100 billion in business interruption insurance from the federal government, suspension of taxes, and a reduction to delivery fees from firms, such as Grubhub and DoorDash.7 8
Amazon’s Cashier-Less Store to Take on Grocers
In February, Amazon released its first cashier-less, 10,400 square foot grocery store in Seattle. The store uses technology that keeps track of purchases as shoppers simply gather their groceries and leave. The move is an attempt by the e-commerce giant to take additional market share from physical retailers, such as Walmart, by building stores that offer high customer satisfaction with less labor.9
Largest Transactions Closed
- StubHub, Inc.
- viagogo AG
- Masco Cabinetry LLC
- ACProducts, Inc.
- The Habit Restaurants, Inc.
- Yum! Brands, Inc.
- American Freight of Ohio, Inc.
- Franchise Groups, Inc.
- Defenders, Inc.
- ADT Inc.
- Southern Comfort Conversions, Inc.
- FOX Factory, Inc.
- Sheraton Grand Phoenix Hotel
- The Blackstone Group Inc.
- InterContinental Buckhead Atlanta Hotel/Sofitel Washington DC Lafayette Square
- Brookfield Property Partners L.P.
- Drybar Products LLC
- Helen of Troy Limited
- 12-Hotel Protfolio
- DFH Capital Ltd.; Arbor Lodging Partners
This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.
EBIT - Earnings Before Interest and Taxes