Business Report: Shakeup At SeaWorld Amid COVID-19 Closure
BottomLine Marketing co-founder and SDSU marketing lecturer Miro Copic discusses some of the week’s top business stories with KPBS News.
Q: SeaWorld has been closed for nearly a month and it's unclear when theme parks will reopen. When it does, the company will have yet another new CEO. Why is there so much turnover in SeaWorld's leadership ranks?
A: SeaWorld's fourth CEO in five years just resigned this week. Serge Rivera, after five months, said he had disagreements with the board. The previous CEO, Gus Antorcha, left after seven months with the same comment. One of the challenges that SeaWorld is going to have is bringing in somebody that's new. And the reason why is because they're still in turnaround mode after the whole Blackfish situation.
One of the challenges SeaWorld is going to have coming out of this is really bringing in visitors. But San Diego, for example, is a good example because we bring a lot of local visitors. So you're going to see when the park is going to be able to open sometime later in the summer there's going to be a lot of focus on bringing in local tourists rather than really pushing for outside tourists because they need to maintain that traffic.
Q: The movie industry is largely on hold amid COVID-19, including theaters. Why are analysts starting to worry about one major chain, AMC?
A: The analysts are showing that maybe AMC Theatres has about three or four months of cash left, maybe to the end of June or the middle of July. And the theaters aren't really expected to open until July or August. So that means no cash is coming in. They've already laid off 600 of their corporate staff. They stopped paying rent on all of their various buildings and theaters that they own or leased.
They're still trying to drive revenue through renting movies through their website. But the issue is you have a recent movie that's renting for $6.99 that came out in theaters a few weeks ago. The problem is at $6.99, that's the cost of a streaming subscription for most consumers. Disney and Disney Plus with Hulu just surpassed 50 million households this past week. Consumers are trading this off. And when you have unemployment going from potentially 3.5% to over 12% in the month of April, consumers are conserving cash. And so even new revenue streams that could have been lucrative for AMC are drying up. So they are looking at a bankruptcy where they're gonna have to reorganize their debt and to be able to go forward unless things change relatively quickly.