March 25, 2008 / 4:01 PM / 11 years ago

Netflix resumes DVD shipping after online outage

Reed Hastings, CEO of Netflix Inc., a online DVD-rental service, holds several DVD's as he poses at the Netflix offices in Beverly Hills, California December 8, 2005. REUTERS/Fred Prouser

LOS ANGELES (Reuters) - Online DVD rental company Netflix Inc said it resumed shipping DVDs on Tuesday after a technological breakdown knocked out its site for much of Monday.

“We’re shipping everything that should have been shipped yesterday as well as what we’d normally ship today,” said Netflix spokesman Steve Swasey.

Swasey said the company, which has about 7.5 million subscribers, was still determining an appropriate course of action for those customers whose shipments were delayed, such as possibly crediting their accounts.

He said the site was out for about 11 hours on Monday.

Swasey said that most of the company’s 52 distribution hubs were down most of the day. Netflix shares fell 78 cents, or 2.1 percent, to $37.37 on Nasdaq.

The outage occurred on the same day as the company’s shares climbed more than 9 percent to a new all-time high on Monday, after an analyst described the online movie rental service’s financial forecast as “conservative” and raised his price target.

Netflix’s stock traded as high as $39.65 on Monday, a 79 percent increase since January 15, when it began climbing on better-than-expected results, a string of analyst upgrades and the company’s own raised fiscal year and quarterly forecasts.

The Los Gatos, California company’s all-time high on a split-adjusted basis was $38.83, reached on January 22, 2004, a Netflix spokesman said.

Reporting by Sue Zeidler

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