Redbox parent company Coinstar released its third-quarter investor update today, and the news was stellar. 3Q revenue from Coinstar’s Redbox and much-smaller DVDXpress brands jumped to $198.1 million, a 90% increase over the $104.2 million earned in the same period in 2008.
Redbox’s sales growth surpassed marketing and administration costs, as operating income doubled to $34.5 million and same-store sales increased by 26%. And there’s plenty of room to grow, according to Coinstar CEO Paul Davis, who said that “We think there’s a lot of white space” in the kiosk market.
Davis estimated that Redbox’s current share of the U.S. DVD rental market is about 15%, and said that digital delivery is still in its infancy and will not pose a threat in the near future. Overall, Coinstar estimates that its 2009 DVD rental revenue will reach about $770 million. This means the company is anticipating about $230 million in Q4 DVD revenue, which would be a 72% increase over the same period in 2008. The sanguinity of these projections demonstrates the company’s continued confidence in its business model and title aquisition capabilities.
As great as this news is for Redbox and its parent company, the true measure of the kiosk vendor’s strength will come in the fourth-quarter numbers, which will cover a period when Redbox is denied street date titles by three major studios.
Are you encouraged by this report, Insiders? Can Redbox keep the good times coming in the crucial final quarter of the year?
[via Video Business]