The Marcus (MCS) Q1 2026 earnings summary

Executive summary

• Revenues rose 3.8% year-over-year to $154.4 million in Q1 FY2026, with both theater and hotel divisions outperforming their respective industries despite five fewer operating days due to a fiscal year change.

• Theaters led growth, driven by a strong film slate, improved attendance, and higher per capita sales, while hotels benefited from renovated assets and new openings, resulting in higher RevPAR and occupancy.

• Operating loss improved to $19.3 million from $20.4 million in Q1 2025, with net loss narrowing to $15.4 million from $16.8 million.

• Adjusted EBITDA turned positive at $2.6 million, up from a loss of $0.3 million in the prior year quarter.

• Momentum is expected to continue into spring and summer with anticipated film releases and travel season.

Financial highlights

• Consolidated revenues reached $154.4 million, up 3.8% year-over-year; on a comparable calendar basis, revenues rose 15.6%.

• Operating loss improved by $1.2 million to $19.3 million; net loss per diluted share improved to $(0.51) from $(0.54) year-over-year.

• Adjusted EBITDA was $2.6 million, up $2.9 million year-over-year; on a comparable basis, adjusted EBITDA grew $8.2 million.

• Cash flow from operations was a use of $15.2 million, a $20.1 million improvement year-over-year.

• Capital expenditures decreased to $6.6 million from $23.0 million year-over-year.

Outlook and guidance

• Expect continued growth in both divisions, supported by a robust film slate and strong group bookings in hotels, with group room revenue bookings running about 5% ahead of last year.

• Capital expenditures for 2026 are projected at $50–$55 million, with a significant increase in free cash flow anticipated.

• Effective income tax rate for fiscal 2026 is expected to be in the 32%-34% range.

• Management expects business travel demand to soften in the near term, with group business stable and leisure travel showing seasonal trends.

• Management remains optimistic about the long-term industry outlook and is prepared to adjust quickly to changing market conditions.