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Barnes and Noble Income Declines in Third Quarter

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Feb 20 – Feb 26, 2012 Edition Barnes and Noble Income Declines in Third Quarter NEW YORK, NY/AUTHORLINK NEWS/February 21, 2012—Barnes & Noble reported Tuesday that its fiscal third-quarter net income declined 14 percent, due to rising costs that offset higher sales of both traditional books and digital books. Also on Tuesday, the company introduced its Nook Tablet device with 8 gigabytes of memory for $199. Its current 16GB device sells for $249. Rival Amazon.com sells its similar 8GB Kindle Fire for $199.Barnes & Noble reduced the price of its Nook Color device, with fewer features than the Tablet, to $169 from $199. Income from its Nook e-readers and digital catalog rose 38 percent to $542 million. The figure includes the actual selling prices for e-books. Traditional book sales increased 4 percent, perhaps due in part to the fact that it did not have to compete with the now defunct Borders. Barnes & Noble has been focusing more on games and toys and less on books, a move that seems to be more profitable. Revenue in stores open at least one year rose 2.8 percent. “In the third quarter, our traffic and sales in stores were the highest we’ve seen in five years,” said Barnes & Noble CEO William Lynch. Net income for the 13 weeks ended Jan. 28 fell to $52 million, compared to a loss of $60.6 million last year. Income 5 percent to $2.44 billion, slightly under the $2.53 billion that analysts had predicted. The company’s cost of sales rose nearly 12 percent and its selling and administrative expenses were up about 14 percent. For the full year, Barnes & Noble reaffirmed that it expects a yearly loss of $1.40 to $1.10 per share on total sales between $7 billion and $7.2 billion. Analysts expect a loss of $1.14 per share on revenue of $7.26 billion.