Chicken Soup For The Soul is the parent company behind Redbox, Crackel, and the streaming service by the same name. Now, the company is reportedly having cash flow issues that have resulted in some content creators not getting paid. One of these clients includes PJT Partners who helped it close its deal to buy Redbox now PJT Partners is seeing Redbox and their parent company.
Recently in the second quarter of 2023, the company posted a quarterly loss of $43.7 million, or $1.50 a share, more than double the year-ago loss of $20.8 million, or $1.39 a share (when the total number of shares was half the amount). Revenue more than doubled to $79.9 million because year-ago results didn’t account for revenue from Redbox, which it acquired on August 11, 2022.
Chicken Soup For The Soul is in a tough situation after acquiring Redbox in 2022 for $50 million in stock and an assumption of $325 million in debt. Add on top of that a shaky media environment with cratering ad revenue and quarterly losses, and the company’s future is very much in the air. In August, CEO William J. Rouhana said that the company was holding a strategic review to evaluate its opportunities, which is business speak for putting itself up for sale.
Now PJT Partners says it is owed $3.4 million in fees related to its work to help close the Redbox deal. According to PJT Partners it has not received any payments since April 2023 according to a report from Bloomberg.
Chicken Soup for The Soul last year announced that it was in active discussions for a potential sale back in October of this year but so far nothing has come from these talks.
Like many media companies, they have likely been impacted by a soft ad market that has negatively impacted revenues. For a company that heavily relies on ad-supported streaming, this market has to negatively impact the service. Right now, the company seems confident that they will be able to work through these issues and pay their partners. For now, we will have to wait and see what happens.
Chicken Soup for The Soul has not replied to our request for comment at the time of this posting.