S&P Global Ratings upgraded AMC Entertainment Holdings Inc. (NYSE:AMC) to 'B-' from 'CCC+' on Tuesday, saying the company has shown better operating performance and a clearer route to sustained positive free cash flow. The ratings agency kept its outlook on AMC at stable.
Along with the corporate-level upgrade, S&P adjusted several issue-level ratings across AMC's debt instruments. The firm's $2 billion first-lien term loan was raised to 'B+' from 'B'. Muvico LLC secured notes and the 7.5% AMC secured notes were moved up to 'B-' from 'CCC+'. The Odeon first-lien term loan was upgraded to 'B' from 'B-'. S&P also revised the rating on $112 million of exchangeable notes to 'CCC' from 'CCC-'.
The agency referenced AMC's second-quarter 2026 performance, noting the exhibitor reported record revenue and adjusted EBITDA. Revenue rose 14.2% year-on-year, while adjusted EBITDA was roughly 37% higher compared with the same period in 2025.
S&P highlighted the company's recent debt reduction measures. AMC used proceeds from share offerings to retire $125 million of subordinated notes, and noteholders converted about $156 million of exchangeable notes into common stock. Those moves, together with stronger EBITDA, resulted in a lower interest rate on approximately 75% of AMC's debt, delivering estimated annual interest savings of about $51 million.
The rating agency raised its estimate for the domestic box office in 2026 to approach $10 billion, above its prior projection of $9.3 billion and well ahead of the $8.6 billion recorded in 2025. S&P attributed improved theatrical trends through July 27, 2026 to strong showings from several titles, including "Toy Story 5", "The Super Mario Galaxy Movie", and "Odyssey", and said these releases helped drive an approximate 10.3% improvement year-to-date as of that date.
On company guidance, S&P expects AMC's revenue to increase about 13% in 2026 and to grow by roughly 4%-5% in 2027. Despite those top-line gains, the agency noted AMC still carries a significant debt load, with total debt near $3.8 billion, annual interest expense in excess of $450 million, and rent obligations around $850 million.
At the end of the second quarter, AMC reported $778 million in cash on hand, and its nearest major maturity does not occur until 2029. S&P expects the company will record a modest free cash flow deficit in 2026 before moving into sustained positive free cash flow in 2027.
Contextual note: The rating action reflects a mix of improving operational results and continued leverage and fixed-cost burdens. The stable outlook indicates S&P does not anticipate immediate further changes, contingent on the company meeting revenue and cash flow expectations outlined above.