The Good News: Blockbuster Same-Store Sales Rise
Blockbuster (BBI) on Thursday reported an increase in U.S. same-store sales for the fourth quarter of fiscal 2008.
According to the Dallas-based company, domestic same-store sales rose 4.4%, compared with a 0.9% decrease in the fourth quarter of 2007.
Largely driving the increase were retail comparables -- sales of games, game merchandise and consumer electronics -- which grew 36.5%. Domestic same-store rental comparables fell 2.6%.
For all of 2008, Blockbuster's domestic same-store sales rose 6.4%, compared with a decrease of 6.9% in 2007. The 2008 domestic same-store comparables included a 1.2% increase in domestic same-store rental comparables and a 37.4% increase in domestic same-store retail comparables, the company said.Rumors had surfaced that Blockbuster was exploring bankruptcy protection. The company firmly refuted those rumors Wednesday, saying it had hired a law firm to explore options to refinance its debt, not to prepare a filing for bankruptcy protection. Blockbuster has grappled with erosion of market share in the face of rivals including Netflix (NFLX) and Apple, (AAPL), which offers a movie-rental service through iTunes. And, rather than wait to watch entire TV series on DVD, consumers now can watch episodes for free on a number of TV stations' Web sites. Blockbuster shares closed Thursday's trading session down 4.3% to 45 cents. Netflix closed up 0.5% to $37.90, Apple close down 2.6% to $88.84, and Hastings Entertainment (HAST) closed up 3.5% to $2.08.
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