Redbox revenue grows 39%, operating income more than triples
First-quarter revenue for the movie-rental company surged 39% to $502.9 million, and its operating income increased 222% to $76.4 million, Redbox's parent company Coinstar Inc. said in financial results released Thursday.
Coinstar said April 12 that its first-quarter performance would be better than projected thanks in large part to growth at Redbox, but it didn't specify just how well the subsidiary, which operates 36,800 DVD kiosks, would do. (The kiosks also carry Blu-ray discs and video games.)
The improved performance comes after a price increase in late 2011 to $1.20 per night from $1 per night for DVDs. Coinstar previously said that customers reacted less negatively to the price increase than anticipated and that demand was particularly high for titles such as "Moneyball," "Puss In Boots," "50/50," "In Time," "Abduction" and "Mr. Popper's Penguins."
The results demonstrate that despite the ongoing decline in DVD sales and the closure of many DVD-rental stores, including thousands of Blockbuster locations, people still want to watch movies on discs. They just prefer to pay a low fee per night to rent DVDs at convenient locations such as grocery stores and drugstores, where Redbox kiosks are located.
-- Ben Fritz
Photo: Anja Murphy returns videos to a Redbox kiosk in an Albertsons supermarket in Santa Monica. Credit: Lawrence K. Ho / Los Angeles Times