Chicken Soup for the Soul Entertainment considers sale
Chicken Soup for the Soul Entertainment's stock is down 96% over the past year, plunging to $0.53 Tuesday following a disastrous earnings report this week.
Why it matters: After its splashy acquisition of Redbox last year, the company is evaluating its options, including a potential sale.
Details: CEO William J. Rouhana Jr. said in the company's Q2 earnings report that it's forming a strategic review committee of its board of directors to evaluate its options.
- A decision will likely be reached "in a couple of months — maybe sooner" and could mean a sale or strategic partnerships, Rouhana told Media Play News.
Flashback: Back in January, Rouhana was upbeat about the Redbox acquisition when he met with Axios during Solomon Partners' Media and Entertainment Summit, noting the growth in electric vehicle chargers complementing his business.
- "The demand for the screens in those physical locations is quite high," he said. "People view it as valuable real estate."
- It's continued to sign more content deals for Redbox including one with TikTok in July. The company makes money by selling ads that run alongside the videos.
By the numbers: The company reported a net loss of $43.7 million in Q2, more than double its quarterly losses from a year ago.
- Its net revenue also has more than doubled. It reported $79.9 million, up from $37.6 million a year ago.
Of note: Rouhana noted on this week's earnings call that the writers and actors strikes are beneficial to the company since they make its library "more valuable."
- "[A]s that strike continues through the second half of the year, the demand for library content continues to increase. We have a large catalog. We can monetize that in the event of a prolonged slowdown," he said.