SAN FRANCISCO (AP) -- Video rental chain Blockbuster Inc. is scheduled to report its second-quarter results after the stock market closes Thursday. The following is a summary of key developments and analyst opinion related to the period.
OVERVIEW: Dallas-based Blockbuster has been facing stiff competition from rivals like DVD-by-mail service Netflix Inc. and DVD-rental kiosk operator Redbox, and its second-quarter results will shed more light on how its efforts to attract and keep customers are faring.
In May, the company announced that it completed the funding of a $250 million loan. The struggling company had raised the possibility that it might not get the amended and extended credit facility funded in a filing with the Securities and Exchange Commission in April, where it said that the risk that it might not complete financing deals raised "substantial doubt" about its ability to continue as a going concern.
Blockbuster had 7,267 stores at the start of the quarter, which is 138 fewer than it had at the start of 2009. Besides operating brick-and-mortar stores, Blockbuster runs its own version of Netflix and has a service that lets users watch videos over their Internet connections. It has also been putting DVD vending machines in its stores.
BY THE NUMBERS: Analysts polled by Thomson Reuters expect, on average, a loss of 12 cents per share on $1.12 billion in revenue. Analyst estimates generally exclude one-time items.
ANALYST TAKE: In a recent client note, Wedbush Morgan analyst Michael Pachter said he thinks the company's falling store traffic might have bottomed out. He also said he expects "some further improvement in the September quarter, as the DVD release schedule is expected to improve."
Pachter, who rates the stock "Outperform" with a $2 price target, expects a loss of 7 cents per share on $1.13 billion in revenue.
WHAT'S AHEAD: In its latest effort to keep up with Netflix, Blockbuster announced a partnership in mid-July with Samsung Electronics America Inc. to include a DVD rental feature on Samsung's upcoming high-definition TVs.
Through the deal, customers will be able to rent new DVDs from Blockbuster by pressing a remote control button. The rentals are expected to cost $1.99 to $3.99 each and will be available for viewing for 24 hours. Samsung's HDTVs will have this on-demand service starting in the fall.
STOCK PERFORMANCE: Blockbuster shares fell 8 percent, finishing the quarter at 68 cents. The stock has traded between 13 cents and $3.05 in the past year.
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