RealD Reverses Loss and Stock Soars
RealD reversed a loss in its fiscal third quarter, earning $2.8 million as opposed to losing $38.9 million a year ago. Revenue fell 15 percent to $49 million, the company said Wednesday.
Michael Lewis, RealD's CEO and chairman, acknowledged that the 3D film slate during the quarter was "relatively muted," but said "prudent management of operating expenses" enabled the company to turn a profit.
Some of the films released in RealD 3D during the quarter were Immortals, Happy Feet 2, The Three Musketeers, Hugo and The Adventures of Tintin.
RealD stock has been decimated lately as investors worry about the long-term audience appeal of 3D movies and whether studios will remain willing to subsidize the glasses at U.S. theaters.
Earlier Wednesday, though, GARP Research initiated coverage of RealD with a "buy" recommendation, and the stock rose 11 percent to $9.74 during the regular trading session. It was a nice bump from recent lows, but still 72 percent off a 52-week high. The stock soared an additional 13 percent in after-hours trading.
RealD's next big event is the 3D release of Star Wars: Episode I -- The Phantom Menace on Feb. 10, the same day Journey 2: The Mysterious Island opens in RealD's 3D.