Redbox rocks: Revenue soars; Sees big growth ahead
Redbox DVD kiosks are gaining significant traction with revenue jumping 73 percent in the fourth quarter and accounting for the bulk of Coinstar's 2009 revenue.
Coinstar, which owns Redbox, has parlayed its distribution with grocery stores and other outlets into a boon for the Redbox kiosks. CoinStar, which made its name by presenting its green coin counting kiosk, could arguably be renamed Redbox.
To wit:
- Coinstar reported fourth quarter revenue of $328 million, up 43.9 percent from a year ago. Of that sum, DVD revenue (Redbox) was $231.8 million, up 73.2 percent from a year ago.
- For 2009, Coinstar reported revenue of $1.1 billion, up 50.3 percent from a year ago. Redbox accounted for $773.5 million of that sum, up 99.1 percent from a year ago.
- There are 8,700 Redbox DVD kiosks deployed in the field.
Those moving parts added up to fourth quarter net income of $5.5 million, or 18 cents a share, That tally includes a charge of 14 cents a share. Wall Street was expecting earnings of 32 cents a share. For the year, Coinstar reported net income of $55.8 million, or $1.83 a share.
Coinstar did note that its DVD product costs moved higher in 2009.
Meanwhile, Coinstar is projecting further gains ahead for Redbox. For 2010, Coinstar is projecting revenue of $1.46 billion to $1.56 billion with earnings of $1.50 to $1.65 a share. That outlook, which is in line with expectations to a tad better, includes "the impact on revenue and costs related to challenges in securing DVD content, as well as the number and timing of planned kiosk installations."
