Digital movie rental player Redbox Entertainment cut 150 jobs this week to cut operating costs amid the pandemic, as they revealed in a Securities and Exchange Commission deposit Friday.
The filing says the cost-cutting measure is “in response to the ongoing adverse effects of the COVID-19 pandemic.”
According to the filing, Redbox expects the downsizing to reduce its annual operating costs by approximately $13.1 million. Additionally, the company expects to incur one-time restructuring costs of approximately $3.8 million, most of which will go to severance costs.
The SEC filing also said Redbox is unable to file its annual report for 2021 within the required time “without unreasonable effort or expense.”
Redbox was founded in 2002 by Gregg Kaplan and sold to private equity firm Apollo Global Management in 2016 for $1.6 billion.
The familiar red kiosks of supermarkets and convenience stores allow people to physically rent movies and video games at far lower prices than most on-demand platforms. In Dec. 2020Redbox has launched a free, ad-supported streaming service.
Although the downsizing wasn’t officially announced until Friday, shares were already down on Thursday, losing 8.75% from the previous closing price of $2.63, according to Investor Observer. The stock traded between $2.40 and $2.61 on Friday, closing at $2.31, down significantly from its 52-week high of $17.90 on November 1. Redbox’s market cap was $104.85 million as of Friday’s close.