Chicken Soup for the Soul Entertainment, the parent company of DVD rental operator Redbox, has filed for Chapter 11 bankruptcy protection after accumulating nearly $1 billion in debt and reporting losses over recent quarters. The bankruptcy filing, submitted in Delaware bankruptcy court, shows that the company owes millions to over 500 creditors, including big names in the entertainment world and major retailers.
Despite acquiring Redbox in 2022 with hopes of creating an entertainment conglomerate, losses continued to pile up for Chicken Soup for the Soul. The company reported $414 million in assets and $970 million in debts as of March of this year, and its shares have fallen more than 90% over the last year.
With about 27,000 kiosks across the U.S., down from 36,000 at the time of the Redbox acquisition, Redbox is best known for its red-colored, self-serve machines that rent or sell DVDs outside of pharmacies or grocery stores. Chicken Soup for the Soul also operates ad-supported streaming services like Redbox Live TV and Crackle.
The company declined to comment on the bankruptcy filing, noting that its lenders were unwilling to cooperate with refinancing efforts. Despite hopes of reaching consumers across different mediums and boosting revenue, Chicken Soup for the Soul’s financial struggles ultimately led to the Chapter 11 filing.
This marks a significant setback for a once-promising entertainment company as it now faces the challenges of restructuring and rebuilding its financial stability in the wake of mounting debts and losses.
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