Blockbuster’s auditor has questioned the viability of MovieLink, which the company acquired in August.
PricewaterhouseCoopers said it has “substantial doubt about the company’s ability to continue as a going concern,” according to a letter disclosed in a regulatory filing. The auditor cited recurring losses from operations, negative cash flows from operating activities, and MovieLink’s accumulated deficit. According to accompanying financials, MovieLink had an accumulated deficit of $145 million as of June 30, 2007.
MovieLink offers movies that can be downloaded from the Internet. It was previously owned by a group that included some of the largest Hollywood studios.