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Fourth quarter revenue at Blockbuster grew $20 million to $1.51 billion from $1.49 billion a year earlier, with revenue for the company’s online rental subscription service growing by $30 million quarter-over-quarter.
Fourth quarter revenue at Blockbuster Inc. grew $20 million to $1.51 billion from $1.49 billion a year earlier, with revenue for the company’s online rental subscription service growing by $30 million quarter-over-quarter, movie rental company Blockbuster reported today.
Blockbuster reports that it added 700,000 online rental subscribers to its Blockbuster Total Access program during the fourth quarter, including 500,000 paying subscribers. Blockbuster Total Access gives online customers the option of returning DVDs through the mail or exchanging them at Blockbuster stores for free in-store movie rentals.
“We expect to have a total of 3 million Blockbuster Total Access subscribers by the end of the first quarter, which would mean that we will have nearly doubled our subscriber base in the five months since we launched our new integrated offering,” says John Antioco, chairman and CEO. “This growth will require some investment in the first half of the year, but we believe this investment is the right strategy to deliver value to our shareholders and should result in more online customers, more in-store customers, a larger share of the overall domestic rental market and increasing revenues."
Blockbuster, No. 70 in the Internet Retailer Top 500 Guide, also reported that selling, general and administrative expenses increased in Q4 over the year-earlier Q4 by $17.9 million, largely due to the expenses of marketing the Blockbuster Total Access service.
For the full year, revenue decreased 3.5% to $5.52 billion from $5.72 billion, which the company says is the result of store closing and a 2.1% decline in same-store sales. The company reported a $105.5 million increase in revenue from the online rental service.
Net income in 2006 totaled $54.7 million compared with a net loss of $588.1 million in 2005.