We're good to go. Rich, welcome back. We're here with Rich Gelfond, CEO of IMAX Corporation, and we're thrilled to have you. Yeah, 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. 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. For years it was $18. Lucky number, but still nicer to be in the 50s. You've reached a different level of relevance for moviegoing. Just mentioned a bazillion kids outside the theater, the IMAX theater the other day. Very young. Clearly, 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. When we looked at our slate for the year, I was the most bullish person in the company on "Odyssey." Our record up until that point had been $225 million for "Avatar." Keep in mind, that's on 1% of the screens in the world. Today we're knocking on the door of $500 million. How many films do $500 million, let alone in IMAX only? 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. There's a lot going on beneath the surface, but even publicly on the surface. Yesterday we put out a release with The Walt Disney Company saying that they're re-releasing "Star Wars" next February. The 50th anniversary. It was filmed in 35 mm film, and they're releasing it in IMAX. 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. 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. What I described to you, this is just one small anecdote, but I think it's funny, is Chuck Schumer called Adam Aron, the head of AMC Theatres, and said, "I've got to see the 'Odyssey.' Can you get us in?" Adam called me, and he said, "I can't get anybody in. Can you get anybody in?" It's a phenomenon, but thinking about it more in business terms, I think it's a product breakout. Just one final thought is our next big film release is on Dune: Part Three, which is around Christmas, and we put the tickets on sale two weeks ago. If you stop today, which is three months in advance of the film's release, it would be one of the most highest pre-sales in our 60-year history. I don't think this is a one-off. I think it's symptomatic of a real change. Absolutely. As 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. Where we are today, let's put it in some quantitative terms, is for this quarter, we're over $600 million in box office so far, and it's just started to be September. Our best quarter ever was in the mid-300s. When you look at what's coming forward, we have Resident Evil. I know you had Sony on before us, and tracking is quite good on that. We have Digger, which is a Tom Cruise movie coming out. I mentioned Dune: Part Three coming out. We also have a very interesting project, which is called The Further Mis-Adventures of Cliff Booth, and it's a sequel that Netflix is doing to Once Upon a Time in Hollywood. David Fincher's directing. It stars Brad Pitt. Why that's interesting, it's only being released in IMAX exclusively for two weeks. Anyone in the world that wants to see that movie in a theater has to go to IMAX to see it. That's on top of Odyssey still playing. We're having trouble getting it off the screens because the demand is so high. It's a very exciting time, as you look in summer of 2027 is known, and the film slate there looks really good. The Dune playover, because it opens in Christmas, will be very good. You've got at the end of the year, the next Avengers that we're playing there, and you have Frozen, and you have The Thomas Crown Affair with Michael B. Jordan. We're doing again with Netflix, Greta Gerwig's Narnia. To me, as exciting as all that is, it's the stuff that hasn't come to fruition yet that I was mentioning. 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. We did something called an IMAX popcorn bucket, and because it was a test for us, we put 2,500 on sale, and within 90 minutes they were gone. We kept putting more on sale and couldn't keep up with the demand, and I think we sold 25,000 of those. 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 an hour. When you look at our plans for 2027, we're going to lean into merchandising, obviously. I didn't know this, but popcorn buckets, our AMC does $100 million a year in popcorn buckets. We did zero before this year. You just look at more films being filmed with IMAX cameras and released. There's just a lot of things go. It doesn't end in 2027, 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 doing Miami Vice with Joe Kosinski next year. It's just really an incredibly exciting time. When do The Beatles movies come out? With The Beatles? The Beatles. April of 2028. Wow. Actually, Ravi didn't mention that, but I know that's something we've been working on. It's very exciting. Anyway, given- 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 19. 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 as I said before, it's like a new awakening. Studios are recognizing that IMAX is really important to a global blockbuster release. Absolutely. Given this amazing recent performance, how much do you think can be attributed to the huge content cycle that's coming out of finally post strikes, both strikes, and obviously COVID, versus IMAX just simply gaining share globally? Well, it's really both. We were on a very strong growth curve, and 2019 was our best year ever. 2017 and 2018 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 2024 were doing well, and that was because of market share gains. The premium sector, of which we're the primary player, has been really doing well. 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 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. 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 1, which IMAX did close to $100 million in. So I think the move towards proprietary content and first-run content and kind of broadening of diversity of movies is good for us. So I think we're getting there on our own, but I think the Hollywood mega trends are also helping. Right. Others have tried to replicate the success and the premium experience, and we're still seeing others trying, 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 copycats, about the only thing they have in common with IMAX is they have an X at the end of their name. We spend $100 million a year in SG&A. They spend zero. They take a regular projector, and they put it on a big screen, and what a shock, it doesn't look better. We monitor every theater in the world in real-time. We make sure that the standards are kept, the quality is there, people go, and maybe most important, directors really lean into IMAX. With The Odyssey, it is not only the technical aspects, but Chris Nolan filmed it all with IMAX cameras. The first time he was very generous in going around and saying, "That's the way you have to see it." I think the way we are positioned and a kind of end-to-end solution are something that keeps the competition at bay. Of course, you are 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 exhibitors set the prices, we do n't. I think they have been a little conservative in that department. The greatest example is Odyssey, where a ticket is similar to a regular ticket, around $20, $25, but they are being resold online for up to $1,000. I am not advocating that at all, but I think there is some room there. Right. It was crazy black market for The Odyssey. Your relationship is strong across the board. You mentioned Chris Nolan and other directors, but your relationship with Netflix seems to be strengthening as well. They selected IMAX for an exclusive theatrical window for Narnia, and as you mentioned, The Further Mis-Adventures of Cliff Booth, exclusively in IMAX over Thanksgiving 2026, ahead of Narnia, which is 2027. Netflix has also signaled an interest on focusing on the more big event type of content. Do you think IMAX releases fit into that? How do you see your relationship with Netflix evolving from here? Well, first I will give you a general answer, Jessica, which is we have done some research and the fact that a movie is being released in IMAX helps its streaming run later. We looked at movies not being released in IMAX, and IMAX had a profound effect on the streaming end of the run. I think this test with Netflix is kind of exciting, and I am not just looking at what the box office is to whether it is successful or not, but I am looking at the streaming aftermarket and what happens to that and how it affects the vision of the film. I think there is no question that IMAX creates an event around a film and an event aura. 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 would run out and say, "There is a market that is evolving." Warner 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. I think Netflix knows that that is what IMAX does. I think both Greta's movie, The Chronicles of Narnia, and The Cliff Booth movie will have that same kind of impact. Yes, I think both will do well at the box office. More significantly for Netflix, I think it creates an aura around the project and says, "This is something important." As you know, Netflix, after we did the deal, broadened their audience, and they are releasing Narnia in regular theaters as well. I think certainly they could speak for themselves, but from the outside, it looks like they are testing the waters and see how that works for them, both theatrically but more importantly in the streaming world, and fingers crossed, but I think it is a promising experiment. 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 under-penetrated? In terms of penetration, every couple of years, we release our addressable market. Right now we have 1,800 theaters open, and our addressable market is about 4,500. We have a very long runway to go. We also have about 500 theaters in backlog, which means they are signed and over the next couple of years, they will be installed on a global basis. I think particularly Asia- Pacific, we can double our presence there. 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 are up to 10, and I think we have another 10 set to install this year. The Middle East, 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. In Germany, I think we have 10 theaters, and in Ecuador we have 10, and in the U.K. we have 60. Obviously, I think France is an area that can grow. 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 your mix? 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%. Just to 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. We'll release it not only in India, but we'll release it in other countries where there's a lot of Indian expats. A couple examples, anime has really taken the world by storm. I have to admit, we didn't see it coming, how strong it was. 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. I missed your Sony presentation. He probably talked about it a lot. but I assume they talked about it He did. a lot. 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 on 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. I'll come back to your question, but it's 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. We don't own the theaters or hard assets, and we don't make money on concessions. 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. Again, back to the word global. So people look at IMAX and they go, "Oh, well, February is not a good month." So we're not excited. But February is typically Chinese New Year. So in 2025, we played a film called Ne Zha II, and the film did $1.2 billion globally, and I think we did around $160 million. But again, I think one reason our company's had an awakening, but so has our stock, and I think people have come to the incredible conclusion that a dollar earned offshore is equivalent to a dollar earned in the U.S., and about 2/3 of our revenues are outside the United States. I think that diversification is a powerful thing. Again, in terms of global, some of our biggest hits in any year are global. I think that's one reason the analysts have struggled a little bit, because they've heard of Star Wars, they've heard of Marvel, but they've never heard of Ne Zha. 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. Given what you just said, how do you think about capital allocation across regions to continue to drive this opportunity? 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. Obviously, our third quarter is going to be extremely good. I gave you the outline. The revenue side, so we're going to generate a lot of cash, and our cash generation has gone very well. 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. 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. 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 capital. 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. I think, given where we're going from a cash flow point of view, those are primarily the two areas which would be stock backs if it warrants, and expanding the network faster. 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. I think diversification is great for us because what we offer is the IMAX experience. 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. 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." 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 Sinners did so well. Yes, Odyssey is an amazing movie, but Universal and Chris Nolan market it as Universal in IMAX. I think as you try and stand out with a variety of different content, the IMAX of it all becomes more important. Again, I think Formula 1 is a great example because people said, wow, seeing. 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 superhero movies that say, wow, I've got to see it in IMAX. To some extent, we've seen the last few years, some of that has run its course. I think IMAX becomes even more of the attraction. It's a good thing. Right. You mentioned merchandise before, which I don't think most of us thought about with IMAX. It seems like a new potential revenue stream. Can you talk a little bit about where you can take this and maybe what is the response to the popcorn buckets tell you about the fandom of it all for IMAX? Yeah. It tells you that we badly mis-estimated it earlier on, and we should have done it sooner. Since we don't own IP in the movies, that's owned by the studios, I think we need more bespoke merchandise. The one I would focus on even more than the buckets is we sold these film strips, and I think the selling price was around $40, and the cost of goods provides a really healthy margin for that. 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. 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. Our fan base is crazy in a good way. I think we could turn that into collectibles. When you think of movies, although we haven't thought about it at all, I'm sure Sony will kill me, but 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. I'm really excited about that opportunity. And it's incredible. The brand extensions, the merchandise, it's actually very exciting. So anyway, moving on. Given the strength of your brand 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. First of all, I will start with the opportunities. For us, they are in two primary areas. One is in cost reduction, which applies to any company. 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. We have done things that would seem simple. For example, our box office, remember we are in 92 countries with 120 pieces of content. It seems like, gee, this should be a fairly easy business. You release a movie. When you start doing the math, again, it's around 2,000 theaters times 120 pieces of content. There are a lot of things to track and a lot of information to analyze, and AI really helps us do that and, more importantly, draw lessons from it. We are doing that. The other thing is that a more basic level, what we do is we really enhance images. If you take it to lay terms, we blow up things. Not blow up like dynamite, but blow them up, and make sure they still look good, and AI can really facilitate that. We are experimenting with ways. Again, that' s not costing anyone jobs. That's something only we do, and it will help us do it better. I think it is inevitable that the studios and the filmmakers use AI in certain situations. We are not going to lead the pack in figuring that out. Clearly, if the studios and filmmakers decide it's in their interest, then we will use it to our benefit as well. Right. 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 is underappreciated is that we are a platform, and the platform earns money in many different places. We spent most of the time here, and it is probably my fault, I spent too much of the time talking about box office and films. With every theater in the world comes a maintenance contract, and it is almost like maintenance and computer services. 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. We do that because we are not going to release theaters around the world unless they are up to our quality standards, and they are only up to our quality standards if we do four visits a year. As I said, we monitor them in real- time. 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 we do not have one new movie. Another area where we generate significant revenue is when we open new theaters. 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. A very significant percentage of our business comes from selling new theaters. When we sell new theaters, we do get a smaller royalty, but we also get an upfront payment and an ongoing cash flow payment, and that is a significant number. 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. I think people sometimes don't see the various places. Then I guess coming back to box office 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 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 broadening out of revenue streams, whether it's merchandising, brand extensions, 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. 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 done college football. We did the Olympics. Opening. 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. We did it with NBCUniversal, and they were very happy about it. I think that in concerts, actually, coming in the next week or two, we have Oasis, where the pre-sales are pretty good, and we have BLACKPINK coming and we have a number of other things. The margins are similar. If you want to dream ahead, and this is more speculative than other things I have talked about, but you could probably package those events with merchandise because of the fan base, and we have been charging consistent with an IMAX ticket price. But if you package it, rock and roll fans and T-shirts and all that. We are just really experimenting with those kinds of contents, and they have been pretty good. We bring back old movies. We brought back "INTERSTELLAR," and I don't remember exactly, but I think we did $5 million in a weekend when things were slow. I do think there is a lot of potential, but we are just starting to understand it now. Amazing. This is an industry question, but obviously we are seeing a lot of consolidation. I mean, eventually Warner Bros. will be consolidated whether it is Paramount's guidance or not. I mean, hopefully it 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 wound up not, said they were developing their M&A muscle. When you see all of these things, all of these moving pieces, how do you see the industry evolving over the next three to five years? Is this good or bad for IMAX? Well, first I'll answer the end of your question, then I'll back up to the beginning of it. 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. 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. They came to us, and they released it in IMAX and film prints. Again, we did $100 million. Again, this was not a franchise that anyone had heard of. I know that Amazon and MGM were extremely happy about it. When you go through the one. So F1 was the biggest streaming property Apple ever had, and that was a streamer, not a studio. Hail Mary was a streamer. The ones we've talked about with Netflix are streamers. Warner 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. We have a terrific relationship with them. We've done the Mission movies, Maverick and Top Gun. 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. Those guys are going to capture market share. I think we will be perfectly fine. In terms of the industry itself, I think it will 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. Let's take a major filmmaker. Just don't want to be sort of agnostic, so let's use someone with the ears, Steven Spielberg. If Steven wants to make a movie and there is not enough studios, he is going to be able to attract capital. I think when you look at this, if you focus on the entities, you are really missing the point. The focus should really be on the capital, and the capital will be there for good projects. Right. To wrap up, you have talked a lot about your vision for IMAX and some of the big drivers, a lot of the diversification, a lot of the growth drivers, margin improvement. Is there anything that you would add to what we have discussed about the next several years? What else can drive your growth, or what else would you emphasize? I think we don't know yet and I am not being coy. We just don' t. 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. When you think of the vehicle market, I think our partner thinks, because there will be driverless cars, that cars are going to increasingly be sold based on entertainment systems. We have our hand in the water right now on that. I don't know where it is going to be, but we are there in case it does happen. On the Vision Pro with Apple, there is 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. I think when you have such strong brand recognition, this merch stuff is crazy. 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 business? No. I think what we built is a brand and a platform, and I think they could take us in a lot of places. Right. Amazing. You have just gone from strength to strength. So we really appreciate you taking the time to be with us. Thank you. Thank you, Jessica. Appreciate it. Thank you.