Barnes & Noble did something they
haven't done for a while in their just-reported fiscal first quarter: They
actually exceeded analysts' pessimistic earnings expectations, with a reduced
net loss of 78 cents per share (or $41 million), versus the predicted 96 cents
a share. And they showed positive EBIDTA for the quarter--just $4 million, but
much better than a $24 million loss a year ago. Also, actual bookstore book
sales continued to improve, despite a forecast last quarter that those comps
would decline in fiscal 2013.
But that's about it for the good news. The
bad news is that the supposed "rapidly growing Nook business" has
seriously stalled on a topline basis due to declining device dollars, and even
the increases in digital content sales are getting smaller--consistent with our
analysis recently that ebooks are growing more slowly than they had been. That
means the Nook business, where losses were supposed to start coming down, is
losing even more money than before. And overall company sales of $1.453 billion
were below expectations, up 2.5 percent from $1.418 billion a year.
Nook losses were $6 million (or 12 percent)
higher at $57 million for the quarter, blamed on "continued investments in
the Nook business" and ever-lower prices on existing devices. They
continue to have supply chain issues on the device that people want, as well,
citing "production scaling issues" for the Nook Simple Touch
with GlowLight producing "unmet demand" yet again. On the
earnings call Tuesday ceo William Lynch said Glowlight was "consistently
out of stock...for the entire quarter" and was "never able to fully
capture buzz and enthusiasm." It's only in the last two weeks that device
production has smoothed out without any interruptions, and Lynch believes sales
of the device would have been "materially higher" if not for the
production issues.
Founding publisher of Thomas Allen
Publishers Patrick
Crean has joined HarperCollins Canada to oversee his own
imprint, Patrick Crean
Editions, which will publish between eight and 12 titles per
year with a focus on Canadian literary fiction and non-fiction. "In these
perilous times in publishing, editorial is under such siege by corporatism to
produce, to make a profit," Crean told Quill
& Quire. "Of course, HarperCollins is that, but they really and
truly seem to be devoted to the editorial function and understand it, and
that’s what drew me there." HarperCollins Canada publisher and
editor-in-chief Iris Tupholme said the launch titles on Crean's list may appear
as early as May 2013: "We're not in any rush to put together a list before
it’s ready, but if Patrick has titles ready to publish then we'll go full steam
ahead."
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