Blockbuster Video grows on the wings of DVD

Earlier this week, Blockbuster Video held a conference call to discuss its quarterly earnings, during which a few interesting bits of information came up. Due to strong DVD rentals, the company was actually able to increase its retail sales by 26% for the year’s first quarter. Blockbuster is also still expanding, having added 95 new outlets to their system with plans to add a total of 450 new stores over the course of this year. Although this growth is significantly smaller than last year, during which the company had opened 600 new locations, it is mostly designed to solidify the return on investment, especially for those newly opened stores. In addition to that, Blockbuster is bringing the average size of its new stores down by a third, creating mostly outlets with 4,000 to 4,500 square feet, as opposed to 6,000 to 6,500 square feet in previous years.

DVD has been very good to Blockbuster and accumulated, DVD rentals now account for almost 8% of the company’s total business. Blockbuster chairman and CEO John Antioco expects this number to exceed 10% by the end of this year.

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