Moviepass is literally running out of money

Lawrence Kim
July 28, 2018

Helios & Matheson - the parent company of MoviePass -said Friday that its ongoing cash troubles had finally hit a breaking point, causing a temporary "service interruption," that sent its stock plummeting as much as 66%.

The company hasn't said whether MoviePass has resumed operation.

In the filing, Helios and Matheson clearly state that a missed payment to its payment processor was the reason for yesterday's service interruption yet on Twitter, MoviePass said the issue was not with their card processor partner.

As of Friday morning, many MoviePass subscribers still can not use the full functionality of the app. Such a service interruption occurred on July 26, 2018.

Customers who tried to access the MoviePass app Friday saw a message saying there were "technical issues with our card-based check-in process", where tickets are issued from a kiosk using a credit card for identification.

But in a tweet late Thursday, MoviePass said that it recommended that users wait for a resolution or use e-ticketing, which it said had not been affected. For us, it's an inconvenience.

All this comes following MoviePass' 1-to-250 reverse stock split earlier this week.

Helios and Matheson, MoviePass' parent company, borrowed the money to try to keep operating from Hudson Bay Capital Management, according to the filing.

"The $5.0 million cash proceeds received from the Demand Note will be used by the Company to pay the Company's merchant and fulfillment processors", Helios and Matheson noted in the filing.

It's market cap is still below the minimum $50 million.

Investors ran from H&M shares on Friday morning, pushing the stock down 61 percent, to $2.69.

The company was not immediately available to comment to Business Insider.

Other reports by Click Lancashire

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