The once-struggling subscription movie service MoviePass has hit another milestone of 1.5 million subscribers, the company announced Tuesday.
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The news comes less than a month after the startup announced it hit the one million marker, which was already a 6,500% lift from its measly 20,000 subscriber base in August 2017.
The reason for the continued spike is “not only a result of the $9.95 price point, but because MoviePass is becoming a sort of viral word of mouth sensation,” said Ted Farnsworth, chairman and chief executive of Helios and Matheson Analytics Inc. (Nasdaq: HMNY), and a majority stake owner in the company.
“Nearly 50% of all MoviePass subscribers go to the theaters with a non-subscriber, so the conversion among friends is very high. In addition, this surge is the result of a package deal with Fandor through Costco: a year of streaming service and unlimited theater attendance for $89.95 – which people jumped on. With this kind of hypergrowth, we believe MoviePass will be self-sustaining, from a positive cash flow perspective, in the next 60 days – and we could not be happier,” Farnsworth added.
MoviePass CEO Mitch Lowe told FOX Business that he thinks the bump is being driven by the consumers’ love of going to the movies and by the cheaper cost – which was originally as high as $50 per month – reigniting the desire to go back into theaters.
“We’re giving people a reason to go back to the movie theaters and they’re going in droves,” Lowe says. “The tremendous momentum we've seen in the last month demonstrates that consumer appetite remain strong with no sign of slowing down.”
However, the despite the massive growth in recent months, the company did have some hiccups in early September after first slashing their prices. The company released a statement telling its new customers that “the response has been overwhelming” and “we’ve tripled the size of our team” in order to meet the new demand. Still, complaints from new customers were rolling in, since many said they haven’t received their MoviePass-issued debit card, which allows them to access movies.
MoviePass says it has grown its staff yet again to handle the growing demand, and HMNY said it projects that MoviePass will acquire at least 2.5 million customers over the next twelve months, and retain at least 2.1 million of those at the end of that period.