Barnes and Noble shares were up 4.9% to $18.59 Wednesday morning after the company released its earnings for the quarter ending in January 2014. Looks like all that corporate and executive restructuring may be paying off. While revenues were down 10.3% to $2 billion, net income came in at $63.2 million, or 86 cents a share, which handily beats out Wall Street’s expectations of 61 cents a share. That’s compared to the same quarter last year, when Barnes & Noble reported a loss of 14 cents a share.
That said, the Nook segment didn’t have a good run. Revenues were down 50.4% year-over-year to $157 million. Breaking that down further, device and accessories sales were down 58.2% to $100 million while content sales dropped 26.5% to $57 million.
“During the third quarter, the company significantly improved its balance sheet and bottom line, while making real progress on our strategic priorities,” said CEO Michael Huseby, in a statement. “Nook losses narrowed significantly as we achieved our objective of selling through much of our pre-holiday device inventory, while managing promotions to optimize sales.”
It’s worth noting, of course, that Barnes & Noble didn’t release any new tablets for the quarter. The company also touched on the fact that due to its efforts to scale back on the Nook segment, a number of jobs have been eliminated. bnvgghhhBarnes & Noble reportedly laid off much of its Nook engineering staff earlier this month.
Interestingly, however, despite all of the struggles the Nook has seen over the last year or two, the company plans to launch a new Nook Color in early fiscal 2015, which would mean later this year.
New CEO Michael Huseby has said that he still has faith in the Nook’s future and insisted that the problem wasn’t with the device itself, but with management.
“We remain committed to delivering world-class reading experiences to our customers through our reading centric e-Ink and color reading devices,” Huseby said in a statement. “The Company is actively engaged in discussions with several world-class hardware partners related to device development as well as content packaging and distribution.”
Michael Huseby was appointed CEO last month following the resignation of former CEO William Lynch, which occurred shortly after Barnes & Noble revealed it would no longer be manufacturing Nook tablets in-house. In the months since, three other B&N executives have bailed, including director of digital products Jamie Iannone, VP and GM of global e-books Jim Hilt, and VP of digital products hardware engineering Bill Saperstein.
Barnes & Noble’s outlook isn’t great. The company expects comparable store sales, core retail bookstore sales, and college store sales to decline this year.
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