Time to close the book on Barnes & Noble
The chain is now minus its CEO, and its future is a mystery that doesn't likely include a happy ending.
This optimism about the New York-based company, which is being stoked as Chairman and top shareholder Leonard Riggio leads a reorganization, however, may be short-lived.
Barnes & Noble has been a mess for years. The company's latest earnings report was especially dismal. Not only did it lose $118.6 million -- more than double what it lost a year earlier -- but sales of the Nook e-reader plunged a depressing 34%. Lynch had made the Nook a focal point of the company's growth strategy, so his departure -- effective immediately -- was hardly a shock.
CFO Michael Huseby will be president of the company and CEO of Nook Media. Barnes & Noble isn’t looking for a new CEO, and Huseby will report to Riggio.
What will happen next is anybody's guess.
Riggio has been trying for months to separate the Nook business from the physical bookstores. Though Nook has gotten some good reviews, it has failed to make any significant headway against market leader Amazon.com (AMZN). In the latest sign of the business' bleak future, Barnes & Noble recently announced plans to find manufacturing partners.
Microsoft (MSFT), the corporate company of Killer Companies, and Pearson (PSO) have taken minority positions in Barnes & Noble's e-book business. There have been rumors that the software giant, which has invested $300 million in Nook, was considering buying the whole business, but nothing has come of them.
Some analysts suggest that the spit will be accelerated now that Riggio has assumed tighter control of the company. That may be wishful thinking. Riggio, who acquired the first Barnes & Noble store in 1971, initially proposed buying the company's 675 Barnes & Noble bookstores and 686 college bookstores in February. Analysts expected the business to fetch $1 billion, but a deal has yet to materialize.
Barnes & Noble certainly has proven to be resilient. The chain has survived fierce competition from Amazon, which forced rival Border's out of business in 2011. Even under the best of scenarios, however, the company's future is at best uncertain.
Though the stock is trading about 4% under analysts' average 52-week price target of $19.50, investors have no reason to buy Barnes & Noble now. The shares offer too many risks for too little reward.
Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.
I like the stores. Clean, courteous clerks, good selection, and the coffee bar cafe tops it off.
I do see as a business man that it seems like a lot of high ceiling space to heat and cool. Notice kids (my daughter included) on their computers at desks but necessarily buying books for food. I always tell my daughter to at least buy a coffee and pastry to support the business.
Will be sad to see the internet drive them out of business. But I like Amazon too.
So much for the double sided curse of the internet. Get what you want at a cheap price, but no more nice stores to walk through loaded with products.
I don't know why people don't purchase off of BN.com. The prices on there are the same if not lower than Amazon. Doesn't anyone comparison shop anymore? The Nook is a much better reader than Kindle too, but people will buy a Kindle because of the name not because it's necessarily better.
Browsers and Grazers, don't pay the bills..
Sounds like they may have too many "laptop hobos" also.
Other businesses should certainly take heed.
soon there will be no stores for people to work at everything will be done in China
sales will happen on Chinese internets and made in China and shipped on Chinese boats and delivered to your house from trucks driven by software run on Chinese computers.
Can you say goodbye to all jobs in the USA
Quess Wall Street will go up 50 percent on this news
How sad. Soon there will no place to go get a cup of coffee on a cold day and enjoy shopping for a new book or browsing our favorite cd's and magazines. What has Amazon done for anyone except put our local brick and mortar stores out of business? Amazon does not provide local employment, contribute to the local tax base, or provide work for these stores supporting service industries. These are jobs that are essential for the fabric of our local communities and we keep losing more and more of them.
When our shopping centers are stuck with vacant book and cd stores and the jobs gone with them, we may wonder who really benefited from ecommerce stores like Amazon.
Worldly Dude, yep that's a lot of the problem...These people are basically "moochers"...
Really nothing different then a "panhandler" on the streets...
Or some lazy basturd, that says they "will work for food." One of the newer scams..
Best way to treat them is the way you did, ask them what they have spent and how long they plan on sucking up the "free ambience".
Any chance that a Fat Guy was one of them, playing with a "mini car collection" layed out on the table with a cheap laptop posting "snide remarks" on MSN.
I do that in Vet's Clubs, when a guy has been sucking on a draft for an hour, they are the guys that never shut up and usually weren't War Vets...I finally tell them I will buy them another beer, if they will just stop the constant yapping...And I can mull over my Whiskey in some peace and quiet.
Another problem facing the niche stores were big box, such as Walmart,Target,etc..
Carrying new Books on sale prices within weeks, same as some Videos or Games.
The Publishers got greedy and anxious and lost some of their outlets.
B&N along with Borders, was built on a concept of just that..."Build and they will come."
My wife thought it would be a good investment, I did not.
Little forward looking to the fact of ferocious internet competition.
And what always used to be dusty little new and used book stores, interest was waning.
Along with Library usage at a questionable levels in several locations.
Another sad chapter in pricing of pennies, leveling others to the dirt.
The "book" is closer to closing on the US economy than it is on BN JACK!!!!
I adore Barnes & Noble, and what could and SHOULD be done would be to have any book, e-book, digital music and/or movie orders purchased from Amazon within the store, result in a payment of some sort to B&N. Often I am in there buying a book when they have only PART of a series. I will order the missing book from my smart phone while purchasing the remaining hard copies from within the store. I would actually pay a minimal cover charge to go in to a good bookstore.
The Nook thing doesn't interest me in the slightest. How hard would it be for them to make an arrangement to carry the reader that folks actually USE?
Book stores cannot be allowed to die. I will continue to support them as opposed to buying my books from Costco or Sam's Club.
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The solid report comes a month after the retailer closed all of its Canadian operations.
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