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circling_vultureIt seems the buzzards might be circling a little lower over once-mighty Blockbuster, whose third-quarter results revealed a massive hemorrhaging of both dollars and customers. The nation’s largest video rental company has revealed that its revenues sank 24% this last quarter, a steeper drop than investors were anticipating. Additionally, same-store sales declined at double the expected amount.

Blockbuster CEO Jim Keyes said that investors need to be patient while the company attempts to develop new revenue streams through kiosks, games-by-mail and on-demand rentals. Said Keyes:

“These things are going to take awhile. These things are basically on trial purposes. . . Give us time. Sorry I can’t give you much color.”

Time, however, may not be on Blockbuster’s side as it continues to lose customers to Redbox, Netflix and an ever-more-competitive VOD environment. Wedbush Morgan analyst Edward Woo echoed this sentiment, singling out Netflix as a content provider prospering at Blockbuster’s expense:

“Netflix is growing really well in a bad economy — the same economy Blockbuster is facing. . . You have to wonder how much more patience investors will have.”

Blockbuster, which has spent much of the past year refinancing its debt and raising capital, plans to increase its advertising spending and stock more copies of popular new releases. It also plans to massively expand its Blockbuster Express kiosk network with partner NCR.

Are the wolves at the door, Insiders, or can Blockbuster find its way back into the black? Give us your Blockbuster prognostications in the comments.

[via Reuters]

7 Responses to “Blockbuster Revenue Dropped More than 20% in Q3”

  1. Member [Join Now]
    slidecage

    blockbuster closed at 76 cents after hours.. seems i will never see the 2.24 per share i paid for this a few years back… everyone was taking back then.. Blockbuster to 5 per share within 18 months… D OH

  2. Member [Join Now]
    slidecage

    blockbuster closed at 76 cents after hours.. seems i will never see the 2.24 per share i paid for this a few years back… everyone was taking back then.. Blockbuster to 5 per share within 18 months… D OH

  3. Visitor [Join Now]
    Jo Anne [visitor]

    Time to bury the body before it stinks up the place. Bye bye, B-Buster.

  4. Visitor [Join Now]
    JK [visitor]

    Maybe if BBuster would drop their in-store rentals to 99cents, carry more product in the store, and get rid of all the crap they carry — candy, magazines, etc. they’d see a return to people using their service.

  5. Visitor [Join Now]
    isnin [visitor]

    4 local franchised blockbusters have closed within the past 6 months in S.E. Wisconsin. Spoke to a (BB owned) BB store manager and she said she was sure that more franchised stores would be closing soon. She declined to comment on the effect Redbox was having on sales in her store.

    I used to be a power renter at BB. I would spend $10 to $20 every single Tuesday getting the new releases. Now I MIGHT go into BB if REDBOX was out of the new releases for the week. I spend roughly 90% less on movies and I am fine with waiting longer to rent new releases. I realize spending that much money on renting movies is ridiculous and it was the first thing I cut out of my budget when money was tight.

  6. Member [Join Now]
    amtj03

    I think bb should option the $1 rentals. So if you just wanted to movie for one night then you pay a dollar. Redbox is only good if you can get the movie and want to watch it that day. BB carries most of all the titles and although you pay 5 for a new release you can keep the movie for 2 weeks, that would be 15.12 for redbox. BB needs to think about the tough time consumers are having and offer promotions, like b1g1 or 3 for the price of one. They would get a lot more business. In Chicago, were I live only a few franchises have closed because redbox is often out of the new releases, so they still get a lot of customers. Plus they carry all the games and that were they still make money.