Redbox DVD kiosk liquidation is coming as the parent company of the DVD rental business is shutting down.
This is due to Chicken Soup for The Soul Entertainment (OTCMKTS:CSSEQ) filing for bankruptcy. The company initially filed for Chapter 11 protection but has now switched its bankruptcy filing to Chapter 7.
With this, there’s no future left for the Redbox DVD kiosk, which means that liquidation is on the horizon. However, it’s still unclear how long it will be before the DVD rental locations stop operating.
It could take some time for Chicken Soup for The Soul Entertainment to complete its liquidation of the Redbox DVD business. The company has more than 24,000 kiosks spread across retailers around the U.S. It’s also worth mentioning that it only has 1,000 employees who currently aren’t being paid by the company.
Redbox DVD Liquidation: What’s Behind the Failure
Claims of mismanagement shine some light on the issues faced by Chicken Soup for The Soul Entertainment. Another issue for it was the Covid-19 pandemic. Lockdowns were harmful to its business. The company also notes that the use of its DVD kiosks didn’t bounce back like it expected once the pandemic was over.
CSSEQ stock is up 6.4% as of Friday afternoon.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
