National CineMedia (NASDAQ:NCMI) reported first-quarter 2026 results that management said were in line with expectations, as the cinema advertising company faced typical seasonal weakness, advertising competition from the Winter Olympics and a one-week fiscal calendar shift.
Chief Executive Officer Tom Lesinski said on the company’s earnings call that National CineMedia entered the year with momentum from the holiday period in both theater attendance and advertiser demand. On a reported basis, the company generated total revenue of $34 million and adjusted OIBDA of negative $10.5 million, both within the guidance ranges provided previously.
“Our first quarter played out largely as we anticipated,” Lesinski said, adding that revenue would have increased modestly year over year after adjusting for the calendar timing difference.
Attendance rose as box office improved
Lesinski said the domestic box office grew approximately 25% year over year in the first quarter, while attendance across National CineMedia’s network reached 83 million, up 15% from the prior-year period. He said the difference between broader box office growth and the company’s attendance growth primarily reflected the fiscal calendar shift and the Winter Olympics, neither of which affected the first quarter of last year.
On a comparable basis, including Spotlight in the prior-year period and adjusting for the calendar shift, attendance would have been up approximately 18%, according to Lesinski.
The quarter was supported by carryover strength from fourth-quarter releases, including new “Avatar” and “SpongeBob” films, and improved in the final two weekends with “Project Hail Mary” and early contributions from “The Super Mario Galaxy Movie,” Lesinski said.
Management said it expects the 2026 film slate to support a more consistent year for theatrical exhibition, particularly in the back half of the year. Lesinski cited expected releases including “Toy Story 5,” “The Devil Wears Prada 2,” “The Mandalorian and Grogu” and “Moana” as films that could draw a range of audience segments.
Advertising revenue was roughly flat
Total advertising revenue was $31.9 million in the first quarter, compared with $32.3 million in the prior-year period. Chief Financial Officer Ronnie Ng said that, adjusted for the calendar shift and pro forma for Spotlight, total advertising revenue was approximately flat year over year.
National advertising revenue totaled $27.5 million, approximately flat versus the prior year. Ng said strength came from insurance, automotive and pharmaceutical advertisers. On an adjusted basis, national revenue would have declined approximately 2%, primarily due to certain deals within the Spotlight network not returning during the quarter.
Ng said National CineMedia’s legacy network grew national revenue by 2% on a comparable basis, with utilization rising more than 20%, offset by lower CPMs. He said pricing was positive in January and February, but March saw declines because some advertiser budgets had already been allocated to the Winter Olympics.
Demand for the company’s Platinum inventory remained strong, according to Ng. On a calendar-adjusted basis, Platinum revenue was up 83% versus the prior year, and revenue per attendee increased more than 54%.
Local advertising revenue was $4.4 million, down on a reported basis from the prior year. However, Ng said local advertising revenue would have been up 12% on a comparable basis after adjusting for the calendar shift and Spotlight. He pointed to strength in travel and wireless, offset by lower activity in government, education and healthcare.
Company expands lobby and programmatic initiatives
Lesinski highlighted National CineMedia’s April announcement of a partnership to deploy large digital displays in high-impact lobby placements across 77% of AMC Theatres nationwide, focused on high-traffic locations. He said theater lobbies are high-dwell-time environments that can help brands reach moviegoers before and after films.
In response to an analyst question, Lesinski said the lobby initiative is expected to be “largely incremental and separate” from on-screen advertising, with much of the inventory likely sold programmatically through digital out-of-home platforms. He said the displays will primarily feature video formats and could include interactive elements such as QR codes.
Programmatic activity also grew in terms of order volume. Lesinski said National CineMedia saw approximately twice as many programmatic orders in the first quarter as in the prior-year period, although revenue was softer because a small number of larger advertisers did not return as they focused budgets on the Winter Olympics. He said second-quarter programmatic revenue was pacing ahead of the prior year.
The company also continued developing NCMx, its proprietary data platform. Lesinski said National CineMedia announced a partnership with VideoAmp that allows advertisers and agencies to plan cinema alongside linear TV, connected TV and digital video in a single view. The company also extended NCMx coverage to Spotlight inventory.
Cost savings and capital allocation in focus
National CineMedia implemented an operational transformation in the first quarter intended to streamline the organization and accelerate the use of artificial intelligence where management sees leverage. Lesinski said the initiative is expected to generate approximately $11 million in annualized cost savings on a run-rate basis.
Ng said operating expenses were $60.9 million in the first quarter, compared with $58.8 million in the prior-year period. The increase was primarily tied to higher attendance-related exhibitor fees and approximately $3.6 million in one-time costs related to the operational transformation. Adjusted operating expenses were $44.5 million.
The company has already actioned $3 million of the targeted annualized savings, Ng said, with the remainder expected to be completed by mid-summer. National CineMedia expects to realize up to $6 million of savings in full-year 2026, with the full run-rate benefit reflected beginning in 2027.
First-quarter operating loss was $26.9 million. Unlevered free cash flow was $18.1 million, compared with $5.5 million in the prior-year period, supported by working capital normalization from the fourth quarter. At quarter end, the company had $51.6 million in cash equivalents, restricted cash and marketable securities, and total debt of $12 million.
National CineMedia announced a quarterly dividend of $0.03 per share, totaling $2.8 million, payable June 4, 2026, to stockholders of record as of May 22, 2026. The company also repurchased approximately 210,000 shares in the first quarter for about $820,000 at an average price of $3.93 per share.
Ng said the company’s capital allocation priorities are evolving toward internal investment opportunities, including rebuilding the local business, enhancing programmatic and self-serve capabilities, and strengthening inventory across the network.
Second-quarter guidance reflects stronger slate
For the second quarter, National CineMedia expects revenue between $57 million and $63 million and adjusted OIBDA between $1 million and $5 million. Ng said the outlook reflects expectations for higher attendance, increased theater exhibition fees, improved monetization from the unified Platinum network and stronger local performance.
During the question-and-answer session, Lesinski said the company has not yet seen a significant impact from macroeconomic factors such as tariffs or oil prices. Ng said both national and local advertising were pacing ahead of last year, while noting that management continues to monitor broader conditions.
Analysts also asked about political advertising ahead of the midterms. Lesinski said the opportunity varies by exhibitor and market, but added that there has been greater openness than in the past. He said National CineMedia is seeking out agencies that control political budgets and views tasteful political cinema advertising as a potential opportunity.
Lesinski closed the call by saying the company remains focused on growing attendance monetization, deepening advertiser value and building a more efficient operating foundation.
About National CineMedia (NASDAQ:NCMI)
National CineMedia, Inc is a leading U.S. out-of-home media company specializing in cinema advertising. The firm operates a proprietary network that delivers high-impact advertising content to moviegoers across a broad footprint of theaters, offering brands a targeted and immersive way to engage audiences in a captive, distraction-free environment.
Founded in 2003 and headquartered in Centennial, Colorado, National CineMedia began as a joint venture among several major exhibition chains.
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