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>In 2017 AMC made 5 billion in revenue and took home 500M in cash. I would say they are doing just fine. That's why I was careful to say "economic profit". On
by savanaly 8y ago
>In 2017 AMC made 5 billion in revenue and took home 500M in cash. I would say they are doing just fine.
That's why I was careful to say "economic profit". On the books numbers are all well and good. But the only indicator I'll take as a sure sign that an industry is profitable in the economic sense is if the number of firms in the market is climbing (i.e. new people are scrambling to get in on whatever benefits they perceive there are to being on the supply side of the market). And movie theaters seem to be more or less in an equilibrium to me.
- hunter23 8y agoIsn't that definition a bit flawed? By this logic, wouldn't Google's search product and their industry be economically unprofitable? The number of search firms is not climbing (in fact its dropping) but Google's search business makes lots of profit (and growing).
- mmt 8y agoYour counter-example describes profit/growth due to monopoly. Perhaps the parent meant a distinct defintion, for a competitive industry.