Rentrak Q1 Profit Falls on Fewer New DVD Rental Titles6 Aug, 2009 By: Erik Gruenwedel
A 30% drop in new DVD and Blu-ray Disc releases contributed to Rentrak Corp. posting first-quarter (ended June 30) fiscal year 2010 net income of $282,000, down 73% from income of $1 million during the previous year’s comparable period.
The Portland, Ore.-based company said pending DVD/Blu-ray releases of summer theatrical hits would positively affect pay-per-transaction (PPT) revenue and operating income beginning in the third quarter.
PPT revenue in the quarter declined to $18.1 million, down 19% from revenue of $22.3 million last year. Operating income fell to $3.1 million.
New CEO Bill Livek said he expected the dearth of new DVD/Blu-ray releases to also negatively affect results in the second quarter, which ends Sept. 30.
“We believe you will see more normalized product releases as summer videos start coming through the pipeline and will cause more positive comparisons in our third fiscal quarter,” Livek said in a call with investors. “It’s difficult to predict our product flow.”
The CEO said kiosk leader Redbox was having an impact on a rental market underscored by consumer reaction to the recession. He said Rentrak would continue to work with kiosks as it does with traditional video rentailers.
“We move in lock step with our studio partners,” Livek said. “If and when they get [kiosks] figured out, we will be there.”
The company’s touted advanced media information division, which includes tracking video-on-demand use among more than 100 million cable set-top box devices, reported an operating loss of about $200,000.
The segment represents 17% of Rentrak revenue and generated $3.6 million, up $600,000 from last year. Costs associated with implementing a New York sales force and related technological improvements contributed to the operating loss.
Overall quarterly revenue is $21.6 million, down 15% from $25.4 million last year.