Blockbuster curbs losses in quarter

Movie-rental chain Blockbuster Inc. said Thursday that it narrowed its third-quarter loss and increased its same-store rental revenue in the United States despite a weak lineup of new DVD releases. Its shares soared nearly 10%.

Chairman and Chief Executive John Antioco said a better lineup of DVD releases and a new policy letting customers return videos ordered online either through the mail or at stores made the company “bullish on prospects for revenue in 2007.”

Blockbuster said it lost $24.7 million, or 15 cents a share, in the July-September period compared with a loss of $491.4 million, or $2.67, a year earlier, when the company incurred huge noncash write-downs.

The Dallas-based company said that excluding one-time costs, it would have lost $11.5 million, or 8 cents a share, in the latest quarter. Analysts polled by Thomson Financial expected a loss of 11 cents a share.

Revenue fell 3% to $1.33 billion from $1.37 billion last year, largely because Blockbuster operated about 80 fewer U.S. stores than it did a year earlier.

Overall sales were hurt by store closings and by what Antioco termed a “terrible” lineup of DVD releases.

However, same-store movie rental revenue at U.S. stores rose 3.2%, compared with a 1.4% decline worldwide.

Shares of Blockbuster rose 39 cents, or 9.8%, to $4.39.