In the age of video on demand, advertisements touting that Netflix (Nasdaq: NFLX) has rented over two billion movies, the pervasiveness of peer to peer (p2p) networks, and the general drum-beat of the demise of video rental, today’s earnings report from Blockbuster (NYSE: BBI) is a shocker:
“Blockbuster Inc., swung to a first-quarter profit amid prior-year termination fees as domestic same-store sales grew for the first time in five years, though total revenue fell amid a decrease in company-owned stores.”
The domestic Blockbuster results — which have improved for the first time in the last five years — were driven by a 20% jump in same-store merchandise sales.
Not rentals. Not through-the-mail rentals, even. By in-store merchandise sales.
Which makes sense. Nowadays if you want to buy a DVD and you want to get it now, where do you go? Wal-Mart or Target? Or Blockbuster, where they always seem to have things on sale because they’re selling lightly used rental disks for $5-$8/each? (heck, I’ve bought DVDs at Blockbuster for $1.99, which is cheaper than renting the movie for a week!)
Anyway, fascinating news. Thoughts?