Blockbuster 3Q Loss Widens, Plans Cuts
Dallas, Blockbuster Inc.'s third-quarter loss widened as it lost a half million online customers and absorbed costs for layoffs and store closings.
Blockbuster reported a quarterly loss of $37.8 million compared with a loss of $27.5 million a year earlier. Revenue fell 5% to $1.24 billion, below analysts' forecast of $1.28 billion.
Blockbuster has spent heavily in the last couple years to build up its online business and was narrowing the gap in customers with industry pioneer Netflix Inc. But over the summer, the number of Blockbuster online subscribers fell to 3.1 million from 3.6 million.
Blockbuster aims to cut annual overhead costs by about $45 million. The company cut 400 jobs in September and closed more than 500 stores in the third quarter—about 7,800 stores remain worldwide. Blockbuster also trimmed advertising spending in the third quarter to $27.5 million from $33 million a year ago.
For the first nine months of the year, Blockbuster lost $125 million after preferred stock dividends on $2.44 billion in revenue, compared with a profit of $33.4 million on revenue of $2.51 billion last year.