South Korea’s largest multiplex operator, CJ CGV, is scaling back operations as it grapples with sluggish earnings, with plans to shut four theaters this month following a round of voluntary retirements in February.
The company, which has struggled to recover from the COVID-19 pandemic amid the rise of streaming services, saw its share price fall below 5,000 won ($3.80) this month, a sharp decline from its 2016 peak of 140,000 won.
According to industry sources, CJ CGV will close theaters in Seoul’s Songpa district and Incheon’s Yeonsu district on March 23, followed by locations in Changwon and Gwangju on March 31. The closures will reduce the company’s domestic theater count to 192.
The move follows a voluntary retirement program last month, in which around 80 employees with at least seven years of service left the company—the first such workforce reduction since 2021.
Industry analysts view the downsizing as a response to declining movie attendance. According to the Korean Film Council (KOFIC), total cinema admissions in South Korea fell 1.6% in 2024 to 123.1 million, just 56% of the pre-pandemic average from 2017 to 2019.
Despite a 27% increase in consolidated revenue to 1.95 trillion won in 2024, CJ CGV posted an operating loss of 76 billion won on a standalone basis. The company’s reported operating profit of 75.9 billion won was largely due to its mid-2024 acquisition of CJ Olive Networks.
“The domestic movie market remains challenging, and we can’t simply expect conditions to improve,” a CJ CGV spokesperson said. “We are restructuring to enhance efficiency.”
Shares of CJ CGV closed at 4,875 won on March 19, up 5 won from the previous session. The stock has been in steady decline since the pandemic and recently dropped below the 5,000-won mark for the first time.
CJ CGV’s struggles reflect a broader downturn in the cinema industry. Rival Megabox posted a 13.4 billion won operating loss in 2024, marking its fifth consecutive annual deficit. Lotte Cinema, operated by Lotte Cultureworks, eked out a 300 million won operating profit, but this was driven by growth in Vietnam, while its domestic business remained sluggish.
Streaming services continue to erode theaters’ market share. In 2024, South Korea’s film and video industry was worth 3.33 trillion won. Theaters accounted for just 35.9%, while over-the-top (OTT) platforms claimed 61.6%. In 2019, cinemas held a 52.5% share versus 42.7% for streaming.
Observers say the industry is trapped in a vicious cycle: fewer theatergoers mean fewer big-budget productions, which in turn leads to fewer hit movies.
Despite declining foot traffic, theater operators cannot easily shut down locations due to long-term lease agreements, which typically span 15 to 20 years, industry sources say.
To counter the downturn, CJ CGV is looking beyond films. The company has partnered with the Korea Baseball Organization (KBO) to broadcast live baseball games in theaters, starting with the March 22 season opener. Games will be shown every Sunday, including regular season, All-Star, and postseason matches. The company has previously drawn audiences by screening concert films from K-pop artists such as BTS, IU, and Lim Young-woong.
CJ CGV is also investing in premium theater formats, including its four-screen ScreenX technology. On March 17, the company signed a memorandum of understanding (MOU) with Samsung Electronics and Harman to integrate artificial intelligence (AI) innovations into future cinemas.
With the South Korean market under pressure, CJ CGV is expanding its presence in emerging markets, including Vietnam and Indonesia.
“Post-pandemic, the way people consume content has changed significantly,” the spokesperson said. “We aim to grow by focusing on technology-driven theater upgrades and a diverse content lineup.”
