Barnes And Noble Company Splits

Barnes and Noble Company is forming 2 separate companies out of its retail stores and the Nook arm of the business. The board of directors voted to create both publicly-owned companies to gain traction in its race against online giant, Amazon. The separation will happen by the end of Barnes and Noble’s first quarter of the 2015 fiscal year.

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Barnes And Noble Company
English: TCU’s Barnes and Noble Bookstore. (Photo credit: Wikipedia)

Amazon’s Kindle and Apple’s iPad dominate the Barnes and Noble Nook in the e-reader market. Barnes and Noble CEO Michael Huseby stated the company should be better positioned to increase the value of the bookseller’s stock by creating a retail arm and a Nook media arm because the 2 entities would be funded and run separately. He also said that the 2 businesses would continue in a successful relationship.

Will the Nook fare well? It’s hard to predict. Nook revenues dropped by 22 percent over the same time last fiscal year. Over the entire fiscal year, Nook revenues dropped a full 35 percent from $780.4 million in 2013 to $505.9 million in 2014

Originally, Microsoft had helped to fund the Nook with $605 million, probably with an eye to purchase the business as a spin off from Barnes and Noble. As things stand now, the Nook is not nearly as viable as Amazon’s Kindle product line or those offered by Samsung, Apple and Microsoft.

Barnes and Noble in general is on an upward swing, posting revenues of $1.3 billion in the fourth quarter, a figure up by 3.5 percent. The actual net income, however, was down by $36.7 million, equal to a loss of 72 cents a share on stock.

For the entire fiscal year, the bookseller had $6.4 billion in earnings in 2014. This figure is lower by 6.7 percent when compared to 2013. Net loss was $47.3 million, better than the loss of $157.8 in 2013. The stock price was a minus $1.12 per share. In 2013, the stock lost $3.02 per share.

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    July 2014