Outerwall Inc., which owns the Redbox DVD rental service and Coinstar coin-counting machines, said Tuesday that its CEO has resigned and a board member will serve as interim CEO while the company seeks a successor.
The company also raised its fourth-quarter earnings guidance but narrowed the range of its revenue outlook. The report sent shares down 19 percent in afternoon trading.
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The moves were the latest sign that the Bellevue, Washington-based company is facing tough competition as technology has spawned convenient alternatives that give consumers quick and easy access to thousands of movies and TV shows. Those options include Netflix's $9-per-month Internet video service, with 37 million U.S. subscribers, and various video-on-demand packages offered by cable- and satellite-TV providers.
Outerwall said its CEO J. Scott Di Valerio has left the company. The company did not give a reason for his departure other than saying it was the "right time for a leadership change" as It seeks to improve profitability.
Nora Denzel, a board member, will serve as interim CEO while the company seeks a permanent successor.
The company expects quarterly earnings per share of $2.40 to $2.52, compared with prior guidance of $1.85 to $2.15. Analysts expect $2.13 per share, according to FactSet. The company now expects revenue of $598 million to $602 million, versus a prior range of $575 million to $605 million. Analysts expect $598.4 million. Outerwall plans to report fourth-quarter and full-year earnings on Feb. 5.
Shares fell $14.78, or 19 percent, to $62.97 in late day trading.