Blockbuster Gains As Rival Goes Bankrupt
(Blockbuster article updated with stock price movement.)
This is the second time in less than three years Movie Gallery has been forced to run from creditors.
The prospect of a thousand stores being eliminated from Movie Gallery's portfolio, which includes Hollywood Video stores, could be a consolation for investors who have been watching Blockbuster suffer.As a result, Blockbuster is climbing 7% to 46 cents in morning trading. In January, Blockbuster said its fourth-quarter earnings came in lower than expected due to weak holiday sales. Blockbuster now expects a loss between $183 million and $193 million. Movie rental stores like Blockbuster and Movie Gallery have, of course, faced increased competition from streaming and mail-service provider Netflix (NFLX)and kiosks from Coinstar (CSTR). -- Reported by Jeanine Poggi in New York.
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