The settlement resolves a nearly 10-year-old lawsuit filed by five producers, including Robert Kirkman and David Alpert, over unpaid profits. AMC paid the majority of the $120 million total resolution during the quarter, with the remaining $35 million due no later than January 31. In addition to the legal costs, the company excluded revenue from ALLBLK, a business unit it divested during the quarter, which contributed to the lower top-line figure. Subscription revenue declined 2% year over year to $308 million, driven by an 11% drop in affiliate revenue from basic cable subscriber losses. This decline was partially offset by a 4% increase in streaming revenue, which reached $181 million.
Analysts noted that a significant portion of revenue from AMC’s co-exclusive deal with Netflix for “The Walking Dead,” announced in the previous quarter, is not expected to be reported until later this year. The company’s performance highlights a broader industry shift, with traditional cable affiliate fees continuing to erode while digital streaming segments grow. The divestiture of ALLBLK and the resolution of the legal dispute remove significant overhangs from the company’s balance sheet, allowing for a clearer view of core media operations going forward.
While this report focuses on AMC Global Media’s media and entertainment segment, it is distinct from AMC Entertainment, the cinema chain. AMC Entertainment has separately reported improving operational metrics, with second-quarter revenues rising 14.2% year over year to $1.597 billion and adjusted EBITDA increasing 69.6% to $321.4 million. Cinema analysts project AMC Entertainment’s 2026 revenues to reach $5.56 billion, up 14.6% from 2025, driven by higher demand for premium format screenings such as IMAX and Dolby Cinema. However, the two entities face different market dynamics, with the media arm grappling with legacy contract disputes and the cinema arm benefiting from a resurgence in theatrical attendance.
Investors remain cautious regarding the media segment’s valuation, noting that while the legal settlement eliminates a known liability, the continued decline in traditional cable revenue presents structural challenges. The next key development will be the payment of the final $35 million settlement installment by the January 31 deadline, followed by the recognition of Netflix co-exclusive revenue in subsequent quarters.
