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Chicken Soup for the Soul Entertainment Inc. reported improving revenue as the number of theatrical releases pick up at its Redbox kiosks, but growing net losses.
The Redbox and Crackle owner reported net revenue of $110 million for the three months ended March 31, compared with net revenue of $29 million a year ago. The company reported a net loss of $58.6 million, compared with a net loss of $14.1 million a year ago and $56.3 million last quarter.
Among the business highlights, the company signed FAST deals with AMC Networks, Fremantle, Revry, and Love Stories TV to bring channels such as The Walking Dead, Portlandia, Supermarket Sweep and The Jamie Oliver Channel to its FAST content on Redbox Free Live TV.
Additionally, the company signed a deal with Amazon Publisher Services to integrate new advertising technologies, including shoppable ads, into its Redbox, Crackle, and Chicken Soup for the Soul apps.
“Our first quarter came in line with our guidance,” said William J. Rouhana, Jr., chairman and chief executive officer of Chicken Soup for the Soul Entertainment. “As we saw in March, we’re anticipating that when new release movies begin to appear in our kiosks and our TVOD service consistently, consumers would return to rent. Starting in the second half of May and over the next several months, we will have, on average, two or more new release titles a week – many of which will be major releases. As a result, we expect to see a meaningful increase in rentals at our Redbox kiosks.”
Overall, Rouhana highlighted a streaming landscape that he says benefits FAST services and companies such as Redbox.
“The media landscape continues to shift and pull in a way that pushes more people to free ad supported streaming. I’m sure you’ve all seen the news coming out of media earnings, with studios now simultaneously removing content and increasing prices on their subscription services, forcing consumers to pay more for less. It’s paying for the privilege of watching ads in most of these cases,” Rouhana said.
The executive said the company had now reached “a steady state” of film releases, starting Tuesday with Ant-Man and the Wasp: Quantumania, then Creed III and Shazam! Fury of the Gods, followed later in May by Dungeons and Dragons: Honor Among Thieves.
He highlighted 11 theatrical releases coming in June and eight in July, including Scream VI and Are You There God? It’s Me Margaret.
The company continues to evaluate new cost cutting methods, including evaluating assets that the company may choose to sell or partner with other companies on to raise additional cash.
Chicken Soup for the Soul Entertainment has already cut costs, deferred executive bonuses to tie them to expectations for free cash flow and licensed $8 million of content. The company plans to cut down on its content spending in 2023, targeting $19 million in content costs in 2023.
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