Blockbuster Posts $37M Second Quarter Loss13 Aug, 2009 By: Erik Gruenwedel
Citing ongoing “trends and market dynamics” and continued “softness” in top line performance, Blockbuster Inc. Aug. 13 reported a second-quarter (ended July 5) loss of $36.9 million, compared to a loss of $38.9 million during the previous-year period.
The Dallas-based No. 1 DVD rental chain said the previously reported refinancing and funding of its amended and extended credit facility resulted in more than 25% fewer units available at retail and an approximately 20% lower advertising spend. The company reduced new release spending 28% and other release spending 40% in the quarter due to funding concerns.
Additionally revenue reflected a $61.3 million negative impact from foreign currency exchange and a decrease in the company-operated store base worldwide.
Quarterly revenue dropped nearly 22% to $1.02 billion, compared to $1.3 billion in the same quarter last year.
"Although market dynamics remain challenging, we expect improvements during the second half of the year will be driven by a favorable title slate and increased unit availability,” said Blockbuster chairman and CEO Jim Keyes in a statement.