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Barnes & Noble's NOOK Sales Decrease 23.9% in 2018

This article is more than 5 years old.

Barnes & Noble released its FY 2018 financial results last week. Nine months after the start of CEO Demos Parneros' tenure, sales are still decreasing, but more less rapidly.

Sales in 2018 decreased 5.96% over 2017 (from $3.89 billion to $3.66 billion), while 2017 sales had decreased 6.47% over 2016 (from $4.16 billion to $3.89 billion). NOOK has, unsurprisingly, fared poorly as the e-book market evolves. NOOK sales decreased 23.9% over 2017 (from $146 million to $111 million), having decreased 23.5% in 2017 over 2016 (from $191 million to $146 million).

Retail sales decreased both years too (5.5% in 2018 and 6.1% in 2017), but the NOOK figures are striking. B&N CFO Allen W. Lindstrom noted in an earnings conference call that, "NOOK turned its first ever full-year profit, generating $3.5 million of EBITDA. Sales declines were offset by continued cost rationalization."

When asked about 2019 for NOOK later in the call, Lindstrom, notes that, for the company, it will "be tough to repeat some of the improvements you've seen, just given the top-line pressures, but we're going to work--continue to work hard on rationalizing costs between our digital segments, which include both NOOK and e-commerce."

So, the question remains: When will NOOK plateau?

Of course, NOOK does not make up the majority of B&N's sales. But an unhealthy market isn't great news for the publishing industry, which hasn't really figured out a great way to harness the powers of digital.

Continued sales decreases, however, are only going to continue to fuel those proclaiming that Barnes & Noble is "killing itself," which is probably why the conference call participants made sure to emphasize their belief that "turnaround plans take time."