Blockbuster Reports 2Q Loss
Dallas, Blockbuster Inc.’s total revenues decreased 1.6% to $1.40 billion for the second quarter of 2005, down from $1.42 billion a year ago. Net loss for the quarter totaled $57.2 million, or 31? a share, compared with net income of $48.6 million, or 27? per share, for the second quarter of 2004.
“Our second quarter results reflect both the success of our new initiatives as well as the impact of the declining store-based video-rental industry,” said John Antioco, chairman and CEO, Blockbuster. “Our ‘No Late Fees’ program is working and our on-line business continues to perform extremely well. These two initiatives helped increase our total rental revenues 9% quarter over quarter, excluding extended viewing-fee revenues. Although we invested heavily to achieve our revenue results, which combined with industry trends impacted our bottom line, we believe we are affecting a permanent improvement in our business that will enable us to address the decline in our core rental business, develop new revenue streams and drive future growth.”
In other news, Blockbuster Online is changing the price of its three-movies-out rental plan from $14.99 to $17.99, reflecting enhanced value and service levels for consumers. Launched in August 2004, the service has a subscriber base of more than 1 million members.
Besides receiving their movies faster, Blockbuster Online customers have a growing library of more than 40,000 titles to select from and should now experience increased product availability. Additionally, Blockbuster Online now gives customers two free in-store rentals per month for as long as they subscribe to the service.