Video and game rental service RedBox is having a banner year, increasing the Q3 earnings of parent company Coinstar 90 percent, the company announced today in its earnings call.
Coinstar’s RedBox kiosks, located in grocery stores and other retail spots, offer inexpensive movie and video game rentals. The dollar-a-day pricing is part of its appeal, but Coinstar announced plans to raise prices on DVD rentals to $1.20 per day.
The company also plans to launch an online subscription streaming service to compete with rival Netflix. The timing is key, as rival Netflix continues to lick its wounds, having shed 800,000 customers in the last quarter alone.
Coinstar’s earnings per share have been between $3.15 and $3.5 per share on revenue of $1.81 to $1.84 for the year. In after-hours trading the shares dropped 11 percent to $47, on investor fears that the price increase would hurt future sales, according to the Wall Street Journal.