Blockbuster swings to a loss on costs
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Blockbuster Inc. said it swung to a second-quarter loss as the video-rental company spent heavily on its online business to compete with rival Netflix Inc.
The company reported a loss after paying dividends on preferred shares of $38.1 million, or 20 cents a share, for the three months ended July 1, compared with a profit of $65.6 million, or 31 cents, a year earlier.
Its loss from continuing operations was $34.2 million, or 19 cents a share, compared with a profit of $65.1 million, or 30 cents, a year earlier. Analysts polled by Thomson Financial expected a loss of 33 cents.
Shares of the Dallas-based company rose 10 cents, or 2.4%, to $4.27 on Thursday.
Base rental revenue dropped to $779.7 million from $817.4 million, while merchandise sales declined to $285.2 million from $299.8 million.
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