A Kernel Of Hope: As Movie Theater Business Rebounds, So Do Popcorn Sales

There are certain truths on which we agree. The sun rises in the east. The earth is not flat. And you eat popcorn at the multiplex.

What happens, then, when movie theaters close? For the people who make popcorn, COVID delivered an extra large bucket of trouble. Some barely survived the pandemic, but now popcorn suppliers are crawling back as movie attendance rebounds.

“Those were some dark days for us,” said Sam Krug, the general manager for Preferred Popcorn, a Nebraska-based supplier which sold several hundreds of millions of pounds of popcorn kernels before the pandemic shut theaters three years ago. “And it happened incredibly fast.”

Krug was speaking at the recent convention of movie theater owners in Las Vegas, called CinemaCon. The annual gathering of exhibitors includes previews of upcoming movies and a massive trade floor, where vendors sell posh reclining seats, high-tech sound systems and enough candy, soft drinks and snacks to turn a visitor’s stomach into a cement block.

$7 bucket = $6 profit

Concessions can drive more than a third of a movie theater’s income, and the margins on offerings like popcorn are nearly usurious. If you spend $7 on a medium serving of popcorn, an exhibitor can pocket more than $6 in profits. And new popcorn hybrids have greater expansion rates than before, meaning it takes fewer unpopped kernels to fill a serving. (Oddly enough, when popcorn was introduced as a movie snack a century ago, theater owners considered it a nuisance.)

Krug says about a third of the family-owned Preferred Popcorn’s sales are to theaters. But other venues that sell popcorn — sports stadiums, theme parks, state and county fairs — also shuttered during the pandemic.

“Our sales dropped about 90% in 48 hours,” he said. Nebraska popcorn growers account for a third of all American popcorn exports, with customers in 70 countries. (The majority of corn crops in states like Nebraska and Iowa are now dedicated to ethanol, not edible corn or livestock feed.)

“So we had to get really creative to move popcorn, because it's a perishable product. We looked to different markets all over the world — places we'd never heard of before — and we were able to keep the doors open,” Krug said, adding that he found buyers in the Middle East and South America, including sales to individual street vendors.

Still, overall sales collapsed by half in 2020.

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Ticket sales bounce back

While theater attendance is not yet back to — and may never equal — pre-pandemic levels, ticket sales have bounced back. The summer movie season more or less starts on Memorial Day weekend, with an array of big-budget, mass-appeal releases hitting theaters in the coming weeks.

Still, year-to-date grosses in North America stand at $3.14 billion, compared to $2.44 billion at the same date a year ago. Still, that’s a fraction of 2019’s year-to-date revenues of $4.22 billion, and 2018’s $4.65 billion.

“So it's taken a long time, and this is the first time that we felt it really start to be normal,” Krug said. “It's been a long journey, and we are truly thankful to be back. We're starting to see the cinemas explode again, people getting back to where they were before. And it's so encouraging.”