Barnes & Noble is predicting a fraught chapter ahead, slashing its profit forecast and sending its shares down 12.5 percent. Its stock price is cheaper than the cost of a children’s paperback.
The company on Thursday reported disappointing holiday sales and forecast lower-than-expected profit for 2019. The problems began early in the holiday season, when sales dipped and customers failed to buy some of the big blockbuster books, the company said.
Shares dropped to $5.11 on Thursday, or less than the average $6.99 price for a children’s mass-market paperback. Its stock has plunged by 28 percent since the year’s start, when it traded at $7.11
The dismal holiday quarter and lower-than-expected outlook may raise questions about Barnes & Noble’s strategy as it continues to battle rival Amazon.com, as well as resurgent local booksellers. The company said its online sales fell as well, even as online sales are generally growing for most retailers. At the same time, Barnes & Noble remodeled 91 stores, but the payoffs of that investment aren’t yet clear, its executives said.
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But it’s not only books that are suffering at Barnes & Noble. The store, known for a place where readers can grab a cup of coffee while browsing the shelves, also saw “slowness” at its cafes. On top of that, sales for seasonal gifts and the tchotchkes it sells as “impulse” purchases were slow.
Link to the rest at CBS