Barnes & Noble Nook Narrows Q2 Loss22 Nov, 2016 By: Erik Gruenwedel
Barnes & Noble Nov. 22 said its Nook Digital Business unit reported a second-quarter (ended Oct. 29) operating loss of $8.1 million, which marked a significant improvement from an operating loss of $29.8 million during the previous-year period. Revenue declined nearly 20% to $35 million, from $43.4 million.
Nook Digital Business includes Nook Video (electronic sellthrough, packaged media and transactional VOD), in addition to the Nook tablet.
Early last year Barnes & Noble said it would sell Nook, but then decided to retain it with the retail book business.
Through two fiscal quarters, Nook revenue is down almost 23% to $76 million, while gross margin remains strong at 59.1% — more than double the retail gross margin of 28.8%.
Meanwhile, retail sales, which include Barnes & Noble stores and BN.com, declined 3.5% to $830.7 million. Comparable store sales declined 3.2% on lower store traffic, which was partly offset by the book release of Harry Potter and the Cursed Child.
With books a traditional winter holiday gift item, Barnes & Noble CEO Len Riggio, in an amusing twist, attributed sluggish Q2 results in part to the presidential election. Apparently voters still read books.
“With the election behind us, we hope and expect sales will improve over the holidays,” Riggio said in a statement.