Strong worldwide brand recognition Weak operating performance Technology risks associated with video delivery Highly competitive home entertainment industry Dependence on decisions made by movie studios Highly leveraged capital structure Standard&Poor's Ratings Services' ratings on Blockbuster Inc. reflect its participation in an extremely competitive home entertainment market, weak operating performance, the technology risks associated with video delivery to the end user, its dependence on decisions made by the movie studios, and a highly leveraged capital structure. The company recently revised guidance below our year-end expectations because of weak top-line performance in the fourth quarter. The company bolstered its inventory levels to support higher in-stock availability and increased its advertising spending during the seasonally important holiday season. However, sales failed
